Hacker News Board Hacker News, browsed like a classic message board
Live data from Hacker News

Apple set to get Beats in $3.2B deal

usatoday.com

Post reply on HN
Print view View original

51–60 of 79 posts

Re: Apple set to get Beats in $3.2B deal

#51

Post by InclinedPlane »

unfunco wrote: post #45
InclinedPlane wrote: post #25

Earlier quoted context omitted.

Perception of quality is one of Apple's strongest selling points.

Without sounding rude, what's the actual difference? Or for that matter, how do we define quality? If you're talking about planned obsolescence then Apple could be excused for being in the technology market; which changes rapidly. I use Apple products (except for a phone, which is a Nexus 4) and I nearly always feel that their products are of a higher quality, this might be because of materials (rarely plastic) or it…

Some measures of quality are objective. In headphones, for example, one can measure the degree of distortion of the headphones in reproducing sounds. In smartphones one can measure the quality of the camera, the screen, the durability of the device, and so on.

Many of Apple's products do represent quality construction, but they extract a premium beyond even that and they often put out products which are objectively no better than the competition but which the public nevertheless swoons over and eagerly buys at a premium.

Indeed, the excess perception of quality in Apple products is such a well known phenomenon that it has a name: the Apple Reality Distortion Field. I've seen many comments in this thread alone demonstrating the truthfulness of that phenomenon.

Re: Apple set to get Beats in $3.2B deal

#52

Post by InclinedPlane »

nsxwolf wrote: post #37
InclinedPlane wrote: post #23

Earlier quoted context omitted.

I'd hardly describe it as genius. Apple saw an opportunity: a headphone maker with such a strong brand they can demand a 100-200% markup on their products and still maintain strong sales. Apple is also in exactly that same market, deciding to pickup Beats isn't genius it's obvious.

To be fair, I didn't see you or anyone else predicting a Beats acquisition by Apple. So how obvious is it really?

So you're saying that acquiring an incredibly well-known high-margin manufacturer in the same market is in some way a completely surprising and non-intuitive decision?

Re: Apple set to get Beats in $3.2B deal

#53

Post by InclinedPlane »

adamlett wrote: post #38
InclinedPlane wrote: post #23

Earlier quoted context omitted.

I'd hardly describe it as genius. Apple saw an opportunity: a headphone maker with such a strong brand they can demand a 100-200% markup on their products and still maintain strong sales. Apple is also in exactly that same market, deciding to pickup Beats isn't genius it's obvious.

Obvious? Maybe if the didn't have to pay anything for the company, it would be. But why is it obvious that this acquisition makes sense at that particular price? I'm not saying that it doesn't make sense, only that you have to at the very least consider how much the company is worth to Apple, before you declare it a no-brainer acquisition. Would it still make sense at $4B? $6B? How much would be too much before this…

Beats has a marketshare of something like 2/3 to 3/4 for headphones over $100 and annual revenue of about $1.4 billion in 2013 (1/6 of Facebook's revenue). If anything, $3.2 billion was a steal.

Re: Apple set to get Beats in $3.2B deal

#54

Post by 001sky »

return0 wrote: post #48
001sky wrote: post #35

Earlier quoted context omitted.

Plenty of "mediocre" brands are great businesses. The thesis is that Beats has marketing expertise--can sell cheap things for high prices--in a market where apple lacks it. Apple must know something about beats that nobody else does, otherwise there is no way it's genius. Again, this is false. Its not about "know something" its about "do something". A market-expansion play into high-growth (new) demographic is all ab…

I do not consider myself an apple fan, but i also don't feel my iphone is 'mediocre'. You certainly pay a premium, but it's not like you're paying overpriced fabrics made in bangladesh. I 'm not sure how big a deal beats is outside the US, as well. I also don't agree that 1) they needed to buy any marketing genius (Apple is a marketing genius itself) 2) they are looking to sell overpriced products or 3) that they wan…

Not sure about any of these points being very robust. (3) is simply false, at 200-400 price points you are selling at "premium pricepoints"...thus quality at a profit, is no problem; and wrt (2) since (3), no need to assume (2); and with respect to (1), Beats by DR DRE has street cred in urban markets (people using monthly/android phones) that apple lacks (white suburban rich etc)...if apple can "leverage it more profitably" by simply increasing underlying quality...the make/buy decision does not seem overly complex here.

Re: Apple set to get Beats in $3.2B deal

#55

Post by Akkuma »

sharkweek wrote: post #8
iambateman wrote: post #2

Beats headphones are crap, sure. And their streaming service isn't as mature as Spotify. But three billion dollars isn't about headphones or online music streaming or Dr Dre's drunken celebration. It's about growth. Apple has a chokehold on the iPod market. They've rocked the market with the iPod, iPhone, iPad and those products will be cash cows for a long time. But where is their next growth going to come from? A w…

I was given a pair of Beats Studios almost two years ago, so maybe that makes it easier to say this but, speaking as a non-audiophile, they're... good? I read a lot about how terrible they are, but in my experience, they're comfortable, their noise cancellation is great at work, and I have never noticed degraded audio quality (once again, as a non-audiophile). Could someone point me to a defacto better pair of headph…

If you don't mind spending a bit more I've had one of the older versions of this: https://mrspeakers.com/product/mad-dog-leather-alpha-pads-co...

I had Sennheiser HD595 prior and these are even more amazing. I've listened to a pair of Beats and they pretty much were only bass drowning out everything else. You can also check out www.innerfidelity.com as they have reviews that are not only subjective, but objective.

Re: Apple set to get Beats in $3.2B deal

#56

Post by Akkuma »

IBM wrote: post #36
sharkweek wrote: post #8

Earlier quoted context omitted.

I was given a pair of Beats Studios almost two years ago, so maybe that makes it easier to say this but, speaking as a non-audiophile, they're... good? I read a lot about how terrible they are, but in my experience, they're comfortable, their noise cancellation is great at work, and I have never noticed degraded audio quality (once again, as a non-audiophile). Could someone point me to a defacto better pair of headph…

You're not missing anything, don't worry. I was a former audiophile spending way too much money like everyone else at Head-fi.org Then I realized the collective delusion everyone was living in when I forced myself to double-blind test headphones and various audio formats. Audiophiles are a tiny minority and you can find all of them poo-pooing this deal on Twitter (a lot of them overlap with Apple's customers), but re…

I had the opportunity to test 4-5 headphones without paying a single penny. I also got to try out a pair that was a slightly better model than my old ones I had on hand and found the differences too minimal to think it was worth upgrading to. It was pretty obvious that there were differences between all the headphones. In other words, I disagree with the "You're not missing anything" statement.

I don't know what your definition of spending too much money is, but you can still appreciate good sounding headphones without going crazy and spending an insane amount or constantly getting different gear. I had my last set of headphones for at least 5 years or so until I blew the driver and all the bass was screwed up.

Re: Apple set to get Beats in $3.2B deal

#57

Post by nsxwolf »

InclinedPlane wrote: post #52
nsxwolf wrote: post #37

Earlier quoted context omitted.

To be fair, I didn't see you or anyone else predicting a Beats acquisition by Apple. So how obvious is it really?

So you're saying that acquiring an incredibly well-known high-margin manufacturer in the same market is in some way a completely surprising and non-intuitive decision?

No, not at all - but I don't think that is the same thing as "obvious" the way that word is usually used.

Re: Apple set to get Beats in $3.2B deal

#58

Post by epo »

InclinedPlane wrote: post #53
adamlett wrote: post #38

Earlier quoted context omitted.

Obvious? Maybe if the didn't have to pay anything for the company, it would be. But why is it obvious that this acquisition makes sense at that particular price? I'm not saying that it doesn't make sense, only that you have to at the very least consider how much the company is worth to Apple, before you declare it a no-brainer acquisition. Would it still make sense at $4B? $6B? How much would be too much before this…

Beats has a marketshare of something like 2/3 to 3/4 for headphones over $100 and annual revenue of about $1.4 billion in 2013 (1/6 of Facebook's revenue). If anything, $3.2 billion was a steal.

Citation required for such a handwavy assertion. Beats is a fashion brand and those are notoriously ephemeral. If Beats want to sell they may know the game is up, but then so would Apple.

Re: Apple set to get Beats in $3.2B deal

#59

Post by epo »

ithought wrote: post #11
iambateman wrote: post #2

Beats headphones are crap, sure. And their streaming service isn't as mature as Spotify. But three billion dollars isn't about headphones or online music streaming or Dr Dre's drunken celebration. It's about growth. Apple has a chokehold on the iPod market. They've rocked the market with the iPod, iPhone, iPad and those products will be cash cows for a long time. But where is their next growth going to come from? A w…

It's interesting that Dre didn't create his music (*sampled), didn't write his lyrics and didn't come up with the idea for the headphones yet is celebrated as a genius. It was Monster's idea and then Jimmy Iovine propelled it to where it went. Dre is a quiet, private person, who rarely tours or produces new music. The idea that he is a billionaire now from putting his name on exorbitantly expensive headphones and mar…

Cue all the people irately claiming that sampling is artistic.

Anyway, somehow who gets to be a billionaire just "by putting his name" on consumer items has got something going for him, even if it just luck.

Re: Apple set to get Beats in $3.2B deal

#60

Post by adamlett »

InclinedPlane wrote: post #51
unfunco wrote: post #45

Earlier quoted context omitted.

Without sounding rude, what's the actual difference? Or for that matter, how do we define quality? If you're talking about planned obsolescence then Apple could be excused for being in the technology market; which changes rapidly. I use Apple products (except for a phone, which is a Nexus 4) and I nearly always feel that their products are of a higher quality, this might be because of materials (rarely plastic) or it…

Some measures of quality are objective. In headphones, for example, one can measure the degree of distortion of the headphones in reproducing sounds. In smartphones one can measure the quality of the camera, the screen, the durability of the device, and so on. Many of Apple's products do represent quality construction, but they extract a premium beyond even that and they often put out products which are objectively n…

> Some measures of quality are objective.

Almost by definition, anything that is "measure" of something, is objective. But just because something can be measured, doesn't mean that it is important. It's a well described phenomenon that we tend to focus on only that which can reliably be measured, and tend to ignore that which cannot. At what point does sound quality become "good enough" that it takes a backseat to other parameters of quality? I've personally long maintained that in some important respects, the standard iPhone headphones are better than more expensive, objectively better sounding headphones that I've also used, simply because they get small, seemingly insignificant details right, like where on the chord is the microphone placed, and how long is the chord, and how do they feel in my ear. I'm constantly surprised at how little consideration is usually given to details line these in even very high end headphones.

The point I am trying to make is this: Subjective perception of quality is far more important than objective measures of quality. The best product is the one that does the job well enough and is the most delightful to use.

Post reply on HN