However, with HTC’s internal struggle and incapability to fund Beats Electronics ventures into other audio areas, the headphone maker, lead by Dr Dre and Jimmy Iovine, may be preparing to buy out HTC’s stake in the business, afterwards cutting business exclusivity ties with the company.
Beats Electronics is currently in talks with an investor who may be able to secure enough funding and take a minor share in the business. The two music moguls have kept a strong hold of Beats, making sure the company is firmly in their hands.
In 2011, HTC bought 51% of Beats Electronics, but sold back 25% to the company owners for about $150 million. Since then the relationship has been jagged, with rumors circulating about the Beats’ owners wanting to take back full ownership for a while now.
HTC has been able to have exclusive rights to phone audio from Beats and it has been used in almost every single high-end HTC device. As with Nokia and Windows Phone, it may have been less lucrative for Beats Electronics, they could have made lots more revenue if they could partner with Samsung or Apple.
Moving into the music streaming market and pushing their audio projects is the way Beats Electronics seem profit and sustainability. Even though their headphone line is doing well, they still need to push the brand into other areas to keep relevant.
With a fresh fund in the bank, the company will be able to successfully push their brand in the different markets. We wonder how HTC will see this move to buy the stake out and if HTC will continue to partner with Beats Electronics after getting their part-ownership taken away.
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