With the Rezound, will HTC's $300 million Beats Audio gamble pay off?

With the Rezound, will HTC's $300 million Beats Audio gamble pay off?

Summary: HTC has invested over $300 million in its Beats Audio efforts. But will the project ever bear fruit?


When HTC announced that was buying a majority stake in Beats Electronics for $300 million back in August, most were, understandably, confused. It seemed a dubious partnership, fueled not by any real vision, but rather by HTC's desire to become an Apple-esque technology/lifestyle brand. And what better way to accomplish that than via Beats Audio, which had become successful for improving the relationships people had with music, their most personal of lifestyle choices?

But from a marketing perspective, the move made a whole lot of sense. Beats Audio has never been about just headphones and technology. The Beats Audio brand is infused with a certain amount of coolness and price-induced exclusivity. It's hip, it's music-focused, and though Dr. Dre himself isn't very young anymore, the prime consumers of Beats Audio devices are young people with (hopefully) a lot of cash to burn.

Likewise, Beats Audio headphones are very distinctive, and emerged in full force at a time where nearly everyone had white earbuds plugged into their ears. So it was, from the beginning, a fashion statement, a literal and metaphorical self-statement that "I am different. I appreciate music on a higher level."

That last bit resonates strongly with Jimmy Iovine, the music executive, producer, and founder of Beats Audio. Iovine laid out a bit of the Beats Audio philosophy during the unveiling of the HTC Rezound on Thursday. The Beats Audio project, Iovine said, emerged out of frustration with "the destruction and degradation of sound caused by the digital revolution."

Indeed, the digital revolution did more than just degrade the sound quality of music: It unseated a whole industry, placing free music on countless hard drives and catching music executives with their pants at their ankles. They had no idea what was going on. And they needed technology companies to help them out, which companies like Apple did in a big, big way.

Enter Jimmy Iovine. Iovine realized that the best way to improve the music industry's stakes was to reverse that relationship: Technology companies had to need the music industry.

That's the the rationale behind Beats Audio, which Iovine says brings the music industry into the technology world. That relationship has gone a lot further with deals with companies like HP and HTC, which have more closely combined the worlds of technology, music, and mobile.

And that's a good thing for music. While some music producers have argued that the audio profiles of Beats Audio headphones are far from accurate, the devices certainly do a better job than the run-of-the-mill earbuds phones and MP3 players tend to be packaged with.

And for that Iovine and HTC deserve some credit: Alerting consumers to the sad reality of their personal sound technology makes them more likely to improve it. That, in the end, can only result in people enjoying their listening experience more and subsequently investing more money in it. And that, undoubtedly, will be music to record executives' ears.

That's good news for HTC as well. In HTC, mobile and music have found an interesting marriage. As devices like the Rhyme have shown, becoming a lifestyle brand is clearly the company's goal. While attaching itself to the Beats brand is a risky investment, its very likely that the momentum will be in HTC's favor, especially if the Rezound does as well in North America as the Sensation XE and XL have done abroad.

Topic: HTC

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  • RE: With the Rezound, will HTC's $300 million Beats Audio gamble pay off?

    Didn't help Palm or HP much did it?
  • RE: With the Rezound, will HTC's $300 million Beats Audio gamble pay off?

    When one thinks of music I'm not sure HTC is the company that comes to mind. And when one thinks of Beats Audio and audio headphones, I'm not sure an Android smart phone comes to mind either. Most think of iPods and iPhones with iPod integrations and other audio players. It's just a strange partnership in my opinion.

    HTC is trying hard to become this Apple-like cool lifestyle company but it just feels forced.
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    or music. While some music producers?
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  • It's unusual for me to want to listen to music without headphones

    or at the very least going through the car stereo. I suppose if it was good enough I might just use the phone's speaker for music playback but it's hard to imagine a thin phone with decent sound. We'll see though.
  • RE: With the Rezound, will HTC's $300 million Beats Audio gamble pay off?

  • Never heard...

    I'd never heard of Beats Audio, until the Sensation XE was announced... So that has certainly helped BA.

    Also, the headphone delivered with htc devices haven't improved much over the years (I have 3 htc devices, an old WinMo htc TouchPro, htc 7 Mozart and htc Sensation. All come with similar headphones and they are a pretty lousy fit - although a hundred times better than the ones delivered with my iPhone 3GS.

    But my biggest problem is the darned cables. I only listen to podcasts and audio books, so fidelity isn't that important. I just want headphones I can put out, plug in and listen. With the htc, Apple, Senheiser and Panasonic headphones I've tried, that never works, I have to spend the first couple of minutes untangling the cables, before I can use the darned things.

    I'm seriously looking at getting BT headphones, just so I don't have to waste time untangling (I'll probably end up wasting time finding the charger, or getting a flat battery in the middle of a session, though...).
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