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Dr. Dre's Beats To HTC: It's Not Working Out

HTC is said to be thinking about selling its stake in Beats audio, and Dr. Dre may be about to buy, taking total control.

Dr. Dre's Beats To HTC: It's Not Working Out

Whether you're a fan of Beats Electronics, or think it sells overpriced audio gear for computers, it is a pretty impressive success story: It's on course to make $1.4 billion in revenue this year. But HTC, which bought a 50.1% stake in Beats in mid 2011 for $300 million, would seem to disagree. According to the Wall Street Journal the company is considering selling its entire share of the firm.

Beats is now said to be in talks with an investor so it can buy back the remaining HTC share of the business—having bought half of HTC's stake last year. This would place control of Beats Electronics in the hands of its creators, Jimmy Iovine and Dr. Dre.

HTC's intention was to co-opt the Beats advanced audio technology into its smartphones and other devices to differentiate them in the marketplace, but HTC's smartphone market share hasn't made any big gains in recent years. A fresh report suggests HTC was considering dropping Windows as a smartphone platform after its share dropped below 5% of that market and it slipped from the position as fifth best seller of Android phones—even though its One phone is highly regarded. Nokia, an HTC competitor, is also trying a hardware approach to differentiate its handsets, but has chosen camera tech rather than audio.

[Image via Flickr user: Luke Ma]