Beats Wants to End Partnership With HTC
Beats Electronics, the maker of popular Beats by Dr. Dre headphones, is looking to end its partnership with Taiwanese smartphone maker HTC, The Wall Street Journal reports citing people familiar with the matter.
HTC acquired a 51% stake in Beats for... $309 million back in 2011, but it sold half of it back to Beats in 2012. Now, Beats wants to buy HTC out completely and bring in a new investor who could pave the way for company's further growth.
According to NPD's stats, Beats had captured 59 percent of the U.S. premium headphones market by June 2013, with its 2012 revenue reaching $1 billion. HTC, on the other hand, has experienced several dismal quarters in a row and as such probably isn't the perfect partner for the ambitious Beats.
According to WSJ's sources, the two companies also clashed on strategy, and Beats approached HTC about selling its remaining stake earlier this year.
HTC's top handsets sport the Beats logo and claim superior sound thanks to Beats technology — a partnership that could vanish if the two companies part ways. If Beats wants to expand its business outside of the headphones market, losing that endorsement might be a small price to pay.
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