HTC will be investing $300 million in Beats Electronics, to incorporate the firm’s digital sound technology into upcoming phones it was revealed this evening.
The Taiwanese phone maker had told press earlier on Wednesday it would be making an announcement Thursday morning in Los Angeles, though the company would not say what about.
In a press release Wednesday evening, however, HTC confirmed it would be announcing a “strategic partnership and investment” with Beats Electronics.
“Beats has found a unique way to harness popular culture in a manner that is unlike any other brand today,” said Peter Chou, CEO of HTC Corp. “It’s an exciting brand that has been built around providing something very special, and we believe our strategic partnership will provide customers with unbeatable sound on HTC phones. We obsess over every detail of a consumer’s mobile experience, and audio is a critical part of that experience.”
Luke Wood, President and COO of Beats Electronics told RCR his firm was out to “fix the fractured digital ecosystem” around audio, noting “there’s no bigger platform than the cellphone.”
Jason Mackenzie, President of Global Sales and Marketing for HTC told RCR the partnership was forged to “do something special in mobile,” leveraging Beats’ “very strong and growing brand.”
HTC believes the partnership will set its phones apart from the stiff competition they face from rivals like Samsung, Motorola and others. “It’s a very personal device,” Mackenzie told RCR adding that people were increasingly relying on their phones for quality content.
The integration of Beats into HTC handsets will involve both a hardware and software component, RCR was told, with Beats headsets playing a part. The first handsets rocking the Beats Technology are due out this fall, the company said.
Beats already has a partnership with PC maker HP, which has incorporated the digital audio technology into its TouchPad tablet, though the HTC partnership extends only to cell phones at this time. “We’ll evolve as time goes on,” Mackenzie told us.
“The HTC and Beats by Dr. Dre partnership is an opportunity for two world-class companies to redefine the smartphone industry and define the future,” said Jimmy Iovine, chairman of Beats by Dr. Dre and chairman and CEO of Interscope Geffen A&M Records.
Despite the large investment, Beats Electronics will continue to operate autonomously — with Iovine as chairman and Luke Wood as president and chief operating officer — and continue to work on its current business partnerships, including Monster Cable Products Inc., HP and Chrysler Group LLC. The deal with HTC, however, gives the Taiwanese firm exclusivity when it comes to cell phones using Beats technology, so rivals would not be able to follow suit, although they could look to firms like Dolby Digital instead.
