HTC selling Beats shares back to Dr Dre

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Joe capitalises on a life-long love of blinking lights and upbeat MIDI soundtracks covering the latest developments in smartphones and tablet computers. When not ruining his eyesight staring at small screens, Joe ruins his eyesight playing video games and watching movies. Twitter: @Joseph_Hanlon

Just a year after inking a deal to acquire 50.1 per cent of Beats Audio, HTC is selling the shares back to Beats, offloading 25 per cent of its stake.

The Sensation XL with its bundled Beats headphones.
(Credit: HTC)

HTC has stated that the reason for its sale is to "provide Beats with operational flexibility for global expansion", according to CNET. In the last 12 months, HTC has incorporated Beats Audio software into the majority of its latest smartphone releases, and has bundled headphones with handsets since the end of 2011, including the Sensation XE and Sensation XL.

There is no word yet on how this shifting of shares will impact Beats branding and integration within HTC products going forward, though it is unlikely that we'll see high-quality Beats headphones in the box with new phones. In April, an HTC product executive alluded to how unsuccessful this experiment has been for the company, telling CNET, "an accessory like the headphone doesn't factor in when someone is buying a smartphone".

This news follows a difficult time for HTC financially, with some market analysts estimating that the company may have lost as much as a quarter of its smartphone market share between the beginning of 2011 and the first quarter of this year. Beats is doing better, with a strong share of the premium headphone segment, and a recent acquisition of US-based streaming-music service MOG — a service which launched recently in Australia in partnership with Telstra.

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Maverick_John posted a comment   

HTC actually need to improve all areas of the phones core experience before trying to achieve the market share they want.
I had the HTC one X and returned it, Battery life was atrocious Sense was worse than previous iterations and the phone had a deadly fault, the wifi breaking out.
I got the One XL and similar problems arose, i got around 4 hours of on screen battery life vs the 2 hours the One X gave me, but faulty hardware and a crippling OS made the experience lackluster, I also ended up returning that.
The Desire HD was the best handset they released and they have not returned to their former glory.
Aspects HTC need to focus on, battery, battery, battery. I can not emphasise how important that is. Especially with a unibody chassis that makes it ever more crucial.
Sense OS, Don't utilise a powerful OS such as Android and cripple it with failed multitasking and a worse experience of Sense.
I'm in a situation where i feel like im about to abandon their work and jump bandwagon to another corporation, but im going to try the One XXL, i hope with the increased specs that it will actually perform much more better and i hope all the hardware faults have been ironed out.
Point in Case, Fix your phones first, don't blame the headphones for problematic devices.
And to the 1st poster, Beats are actually decent headphones, Maybe a little over priced but you actually get a good listening experience from it.


JohnnyW posted a comment   

Actually, an accessory like headphone DOES sway someone when buying a smartphone (or anything for that matter, I would argue).

What doesnt sway a smartphone consumer.. is RUBBISH WATERED DOWN CRAP versions of what are otherwise decent headphones.

The ones they included with the ONE X were no better than the free coca cola headphones I got at the Easter show in a $10 show-bag. And i am not exaggerating.

Further to this brand rape, the actual quality of the sound on the ONE X, proved to be terrible compared to other smartphones such as the iPhone and Galaxy.. and neither of these say they have great sound, or make that their main focal selling point.

TBH I have sampled many Beats audio headphones, and even the $500 version are nothing to write home about. Sample a nice set of BW, BOSE, and you'll see what quality sound is.

The Beats brand is nothing more than marketing a gangsta for sales. Pitty the headphones and other "systems" are garbage.

Finally, the HTC one X has a "special" Beats audio chip.. yeah - right. All it really is? It adjusts the EQ to basically punp the bass and leave the rest flat.

I cant place enough emphasis on how terrible it really is. I dont have a particular brand I prefer, but there are so many good ones out there - these are obvious in how terrible they are and the marketing being better than the product.


TrevorW posted a reply   

thanks for an interesting insight. I have been considering One X, or S3.


BartoszW posted a reply   

I completely agree!

When I purchased a phone - I look at its functionality and specifications. If you spend a large amount of cash, you want quality.

If they made a deal with Bose or Sennheiser this would of been a different story.

Beats has a terrible reputation within people who actually give a damn about sound quality.

Marketers take note: cater to niche audiences over mass pop consumption and you will gain consumer respect.

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