Beats Electronics buys MOG. Now what?

An acquisition of streaming music service MOG by headphones firm Beats Electronics has been rumoured for some time. Now it’s official.

“Our whole reason for starting Beats was to try to bring emotion back into that experience. We believe music services is a vital part of that ecosystem,” Beats CEO Luke Wood tells USA Today, which broke the news. “Time will tell exactly how we integrate our products and services,” adds MOG boss David Hyman.

In several ways, Beats and MOG are a good match. For example, MOG was one of the first streaming services to make audio quality a key feature. It’s also been early into devices like televisions and cars – “They understand that the consumer wants ubiquity,” says Wood. Beats is buying a platform and team rather than a big base of paying subscribers though: recent reports have pegged MOG’s userbase at 500k, although that figure includes free users.

What’s most interesting is the wider ownership structure of MOG now it’s been bought. Beats is majority-owned by device-maker HTC, which paid $300m for a 51% share in the company in AUgust 2011. HTC could give MOG a well-funded global push including preloading the service on its smartphones and tablets – the deal that Beyond Oblivion was so keen to do last year, but ultimately failed. Worth remembering, too, is the fact that Universal Music Group has a minority stake in Beats.

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