• The European Commission Approves Apple's $3 Billion Beats Acquisition

    The European Union recently ruled that Apple is allowed to acquire Beats for $3 billion, as the deal wouldn’t be detrimental to consumers in the eyes of the organization. A recently issued press release confirmed that the deal was approved based on the European Merger Regulation legislation. The purpose of this legislation is carefully examine deals and “prevent harmful effects on competition.”

    Although both Apple and Beats sell headphones in Europe, the commission deemed that their combined market share is low enough to not close competitors. The commission went on to note that the headphones from the two tech giants “differ markedly in functionality and design.” It’s competitors in the headphone market including Bose, Sennheiser and Sony would have to deal with tougher competition with once the deal goes through but the merger won’t force any of them to go out of business or put them anywhere close to it.

    It should be noted that the Apple-Beats deal wasn’t just about headphones though. The Cupertino California company also ended up acquiring Beats Music, the on-demand streaming music service, in the merger. The service has yet to launch in Europe and although Apple does run iTunes and iTunes Radio, neither were seen as being directly similar to Beats Music, although consumers like you and I may beg to differ. The following was said regarding the matter:

    The Commission concluded that Apple faces several competitors in the (European Economic Area) such as Spotify and Deezer, making it implausible that the acquisition of a smaller streaming service that is not active in the EEA would lead to anticompetitive effects. The Commission also concluded that the transaction would not give Apple the ability and incentive to shut out competing streaming services from access to iOS, Apple's operating system for mobile devices.
    Although the Beats acquisition by Apple has been approved in Europe, the deal is still pending its US regulatory approval. That being said, it isn’t expected to receive much pus back. The Cupertino California company has said it will keep the Beats Music app available for other platforms such as Android and Windows Phone, as part of the merger agreement. The move would actually make the Beats Music app the first Apple associated app that will be available for competing platforms.

    As of right now, Apple is expected to close the deal out by the fourth fiscal quarter, which ends in September. This is all of course pending regulatory approval.

    Source: Europa via CNET
    This article was originally published in forum thread: The European Commission Approves Apple's $3 Billion Beats Acquisition started by Akshay Masand View original post
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