EU Greenlights Apple’s Beats Acquisition

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EU approves Apple's plan to buy Beats Music and Beats electronicsApple made a big leap forward in its planned US$3 billion purchase of Beats Electronics and Beats Music when the European Commission announced on Monday that is has approved the deal. The Commission doesn't see a combined Apple and Beats as a serious threat to the headphone market, and said there are plenty of competitors who make substantially different products.

"The Commission concluded that the combination of the two businesses did not raise competition concerns because the combined market share of Apple and Beats Electronics is low," the EC said in a statement.

Apple announced in May that it plans to purchase Beats in a $3 billion deal that includes cofounders Jimmy Iovine and Dr. Dre. Beats is known for its headphones and also has a relatively new streaming music service.

The EU doesn't see a combined Apple and Beats as a concern for maintaining competition in the headphone market, saying "a large number of global competitors such as Bose, Sennheiser and Sony would remain."

The Commission doesn't see Apple's control over Beats' streaming music service as a serious issue, either. On that point, the Commission said,

The Commission concluded that Apple faces several competitors in the EEA such as Spotify and Deezer, making it implausible that the acquisition of a smaller streaming service that is not active in the EEA would lead to anticompetitive effects.

Speaker and headphone maker Bose, however, isn't taking the same friendly approach and is suing Beats for patent infringement. Bose filed a complaint with the U.S. International Trade Commission last week and also filed an infringement case in U.S. Federal Court claiming the Beats Studio and Beats Studio Wireless headphones infringe on its noise canceling technology.

U.S. regulators will likely follow the European Commission's lead and approve the buyout, too. There hasn't been any official word yet from U.S. officials, but that will likely come soon because Apple expects it will be able to complete the deal before the end of the year.

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With the EC's approval out of the way Apple is a step closer to closing its Beats purchase. Next stop: U.S. approval.

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