The Apple Inc. Beats Deal Is Bad News For These Two Companies [Apple Inc., Pandora Media Inc]

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May 29, 2014 12:05pm NASDAQ:QQQ

pandoraspotifyApple Inc.(NASDAQ:AAPL) confirmed it will buy Beats for $3 billion in the company’s largest acquisition to date. The move is an effort by Apple to expand its reach into streaming-music as iTunes downloads slow. Apple’s own streaming service, iTunes radio, has yet to make much of a

dent in the market.

Beats brings its own streaming service, as well as co-founders Dr. Dre and Jimmy Iovine. Yahoo Finance Tech Reporter Aaron Pressman says the subscription service is a key piece of this deal. “iTunes is a mess,” says Pressman. “iTunes Radio – it has a lot of users – but financially, it’s done nothing; it hasn’t driven any music sales at all.”

Pressman believes Apple needs Beats to be relevant again. “Beats is something that’s coming out of a much cooler, more in-tune-with-young-people place,” he says. “Once you get Apple’s power behind that, that’s a good way to get them stepped-up into the music business as it is now, today, where kids are listening to streaming music more.”

Bad news for Pandora and Spotify

You can see the full “Daily Ticker” segment below:

Related: Pandora Media Inc(NYSE:P),

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