Dr. Dre, 'American Idol' Mentor Jimmy Iovine Venture Beats Electronics Eyes Acquisition of Online Music Service MOG
NEW YORK - Beats Electronics, the company that makes high-end headphones, is in the final stages of negotiations to acquire online music service MOG, the New York Times reported.
Financial details weren't available.
Beats was formed by hip hop star Dr. Dre and music industry veteran and American Idol mentor Jimmy Iovine. Last year, Taiwanese cell phone company HTC paid $300 million for a majority stake in the company. Iovine has in the past said that he would like to offer a phone-based music subscription service with high-quality audio, according to the Times. MOG could fit into that plan as it streams music at a high kilobits rate a second, according to the paper.
A combination “would close the loop in terms of a vertically integrated offering,” Ross Rubin, an analyst at research firm NPD Group, told the Times. “The playback device, the service and the listening device could all be optimized for Beats.”
With smart marketing and design that has made headphones a fashion statement, the company, best known for its Beats by Dr. Dre line, has been a success. The firm's headphones sell for up to $500, and its revenue last year reached nearly $500 million, the Times said. MOG, founded in 2005, has a subscription service that costs $5-$10 per month.
Representatives for Beats and MOG declined to comment, the Times said.