Beats Electronics looking to step away from HTC

August 19, 2013
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The HTC and Beats Electronics LLC partnership may soon be coming to an end. The details have yet to be officially announced by either company, however a recent report coming from The Wall Street Journal is talking about how Beats are looking to not only make the split from HTC, but also take on a new investor to push forward with some growth. Simply put, it looks like Beats is making moves to take back the 25 percent stake currently being held by HTC.

The details here are pointing towards Beats taking a new investor that will be able to acquire a minority stake in ownership and also provide some debt financing. While a firm timeline is not yet known, it looks like this could all happen within a few weeks time. Representatives from both Beats and HTC have declined to comment on the possible upcoming deals.

While it remains to be seen what, if any effect this will have on HTC, it does looks like it could be good news for Beats. Having this separation would allow them to continue with current plans that have them moving from headphones. Upcoming Beats products look to include speakers as well as in-car audio systems and other consumer electronics.

Looking back Beats sold the first pair of headphones back in 2008 with a price tag of $350. Looking at the bigger picture and it was said that Beats had a revenue of roughly $200 million in 2010 and have since grown that to nearly $1 billion in the last year. Aside from the 25 percent stake owned by HTC, Dr. Dre controls about 75 percent of the company.

While some may think of Beats headphones as overpriced and trendy, they seem to have planted themselves firmly in the market. According to an NPD Group report from this past June, the company has about 59 percent of the US premium headphones market. That group includes both earbuds and headphones and carry price tags of $99 or more.


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