Beats could boot out HTC as it looks to expand business

Beats by Dr. Dre has been associated with HTC since 2011 and now it looks like the headphone maker wants out of this relationship. It has been reported that

Nishtha Kanal|Aug 19, 2013, 13:04:27 IST

Beats by Dr. Dre has been associated with HTC since 2011, but now it looks like the headphone maker wants out of this relationship. It has been reported that Beats is looking to buy out HTC’s share in the company to make room for a new investor.

The Taiwanese company and Beats signed a $300 million deal in 2011 that gave HTC a 50.1 percent stake in the latter company. The handset maker aimed to incorporate Beats’ technology into the phones it was manufacturing. The target group of this deal was more or less the young, hip crowd of the US who would have willingly lapped up Dr. Dre’s line of music accessories.

Bidding adieu to HTC?

HTC has been facing a fair share of problems with its finances and dwindling sales of handsets in the last couple of years. Unfortunately, the company’s team-up with Beats has not done much to either boost its sales or improve its youth connect, as planned.

The Wall Street Journal has now reported that the move to buy-out is coming thanks to the fact that the founders of Beats Electronics are looking to broaden the company’s catalogue. The company is owned by music mogul Jimmy Iovine and hip-hop star Andre Young, better known as Dr. Dre. Beats wants to move beyond only selling headphones to speakers, audio systems in cars and consumer electronics, and is even planning online music streaming service.

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The Taiwanese company had probably seen the problematic phase coming and had sold off half its share in Beats last year, leaving it with merely 25 percent share. The move was an expensive one for HTC as it burnt a hole of $4.8 million in its pocket. Beats, on the other hand, is already looking at improving its future prospects as its moving towards expanding its line of products as well as launching Beats Music, its online streaming service. Not much is known of the service yet, except that the company seems to be roping in Nine Inch Nails’ Trent Reznor for it. Meanwhile, we’re left to wonder who the investor wanting a stake in Beats could be.

By Nishtha Kanal

Intrigued by all things social, Nishtha will invariably tweet about you. When not tweeting or writing about the next viral video, you will hear her proclaiming her love to Metallica, James Hetfield, Opeth, Akerfeldt and all bands that go 'growl'. She also obsesses about ACP Pradyuman and South Park and you will always find her moving around with a book. Her focus is on all the happening stuff in the tech domain, and she won't hesitate to take a shot at some of the oddball devices that make their way to our labs.