(Image Source: Chip Chick)

 

 

BY KYLIE MCGIVERN

 

You're watching multisource business news analysis from Newsy.

 

In the latest attempt to break away from the smartphone pack, HTC has announced a new partner -- with some street cred.

 

WJZ explains.

 

“An up-and-coming headphones manufacturer is getting a big chunk of cash, from an unlikely source you might say. HTC -- which is known for making cell phones -- is buying a majority stake in Beats headphones -- the company championed by famed music producer and rapper Dr. Dre that will net Beats about $300 million dollars in new capital.”

 

The goal is to beef up the built-in speakers in smartphones, creating what HTC calls “superior mobile audio experiences.”

 

A statement from the company says...

 

“...this represents a critical step in our continued mission to clean up the destruction of audio caused by the digital revolution; and reengineer how sound is delivered so that the consumer feels the music the way that the artist intended.”

 

But some are questioning if betting on Beats is best. A blogger for CNN says -- smartphone speakers just aren’t that important.

 

“...rarely do people crank tunes from their phones' speakers...That probably has less to do with phones' subpar audio performance and more with the impracticality of listening to music in that way.”

 

A blogger for ZDNet says the move makes no sense for HTC -- calling the buy a “$300 million case of Apple envy.”

 

“Apple has already moved away from the music infatuation... HTC’s goal to become a lifestyle brand may be valid in some parallel universe, but there’s an opportunity cost related to blowing a wad of cash on appealing to audiophiles.”

 

But a blogger for Wired disagrees -- saying HTC might just be tapping into a deep niche.

 

“I see way more people on the streets than I would expect wearing the overpriced Monster-manufactured headphones... My best guess is that we’ll see Beats-branded handsets with upmarket headphones, kind of like Sony Ericsson’s Walkman-branded phones, only cool.”

 

HTC’s first product with Beats technology is due later this year. 

 

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Transcript by Newsy.

Business News: HTC Buys Beats

The Beat Goes On for HTC

August 14, 2011
(2:04)
Smartphone company HTC is investing $300 million in digital sound company, Beats Electronics.
   
TRANSCRIPT

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