Apple’s Beats Electronics Acquisition & Their Play for Wearables

The industry has been ablaze with news of Apples newest impending acquisition, Beats Electronics, speculating as to the reasoning behind the buy.  Many have struggled to understand their latest chess move into the high-end headphone sector, but taking a step back it becomes apparent it is all a part of a bigger picture, their strategic reach into two hot consumer industries, both streaming music and wearable devices.  The wearable electronics market is the latest new frontier for innovation in the mobile market, and it’s no surprise Apple is aiming to increase their footprint.  What better way than acquiring such a powerful brand which owned over 64% of the high end headphone market share in 2013 while also armed with a popular music streaming platform Beats Music?

Not only has Beats become a dominant brand, but offers the style and scalability consistent with Apples bottom line.  It’s a cash cow, not only from the high price-tag for the headphones, but also the popularity of its concurrent streaming platform which charges a monthly usage fee, giving Apple the opportunity to increase their revenue streams and move further into the music streaming business as music downloads remain on the decline.  In addition, the buy is no doubt an easy way for Apple to position themselves favorably in the market without having to start from scratch in the growing world of wearable tech.  Many anticipate Apple will be souping up the sleek headphones with technology that interacts with users in new ways.  For instance, the headphones could stream music based on your mood, or deliver directions directly in your ear.  The possibilities for application are tremendous.

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In addition, smart headphones could deliver a new way to control other smart devices in our environments as we delve deeper into a truly internet-of-things era.  Integrating iBeacon technology into the headphones would allow applications to know where you are in relation to the world around you, triggering location based actions based on you movement.  For instance, your approach into a room of your home could work with smart home devices used for lighting, and air control, automatically switching on lights and temperature controls.  An iBeacon enabled world will deliver truly contextually relevant experiences for every aspect of our living.  And that is just what Apple is aiming for; to become an integral part of everything we do.

Also, in February 2014 Apple was granted a patent for a health monitoring earphone system to monitoring things like temperature, heart rate, and perspiration.  With this in mind, the recent acquisition of Beats seems right on target for making this technology a reality, while significantly reducing time for development and therefore time to market.  Wearable health monitoring devices and fitness trackers have become a hot industry.  One that has yet to be fully tapped.  It won’t be surprising to watch Apple deliver something truly remarkable to the market, ahead of the pack.