91 Billion Reasons Apple Inc's Beats Music Deal Makes Sense

Three Fools take to the Internet to discuss the reasons behind Apple’s $3 billion purchase of Beats Music.

Jun 2, 2014 at 4:05PM
Beatsmusic Vert Color

Apple is making a bigger bet on music. Credit: Beats Music

What did Apple (NASDAQ:AAPL) get when it purchased Beats Music for $3 billion in total consideration? Host Ellen Bowman puts this question to Fool analysts Nathan Alderman and Tim Beyers in this episode of 1-Up on Wall Street, The Motley Fool's Web show in which we talk about the big-money names behind your favorite movies, toys, video games, comics, and more.

The party line is that music is an essential element of Apple's business and that Beats is a brand leader with celebrity fans and a deep talent bench. All of which is true, of course. Yet Tim says Apple is purchasing Beats for the same reason it's moving into smart-home software: to protect iPhone sales by making the device more attractive.

There's plenty to protect. In fiscal 2013, Apple's $91 billion in iPhone sales accounted for 53% of revenue -- up from 50% the year prior and 42% in fiscal 2011. Smartphones have never been more important to the company than they are right now. As the owner of Beats, Apple could encourage shoppers to buy via bundled headphone deals or free streaming with a new iPhone purchase.

Nathan agrees, adding that Beats Music co-founders Dr. Dre and Jimmy Iovine could also help Apple to bridge the creative and cultural gap that exists between Hollywood and Silicon Valley, making it easier for the company to sign exclusive iTunes licensing deals. Entertainment-related sales could soar as a result.

Now it's your turn to weigh in. Click the video to watch as Ellen puts Nathan and Tim on the spot, and then leave a comment below tell us what you think of Apple's purchase of Beats Music. You can also follow us on Twitter for more segments and regular geek news updates!

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Ellen Bowman, Nathan Alderman, and Tim Beyers owned shares of Apple at the time of publication. The Motley Fool recommends Apple. The Motley Fool owns shares of Apple. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.

A Financial Plan on an Index Card

Keeping it simple.

Aug 7, 2015 at 11:26AM

Two years ago, University of Chicago professor Harold Pollack wrote his entire financial plan on an index card.

It blew up. People loved the idea. Financial advice is often intentionally complicated. Obscurity lets advisors charge higher fees. But the most important parts are painfully simple. Here's how Pollack put it:

The card came out of chat I had regarding what I view as the financial industry's basic dilemma: The best investment advice fits on an index card. A commenter asked for the actual index card. Although I was originally speaking in metaphor, I grabbed a pen and one of my daughter's note cards, scribbled this out in maybe three minutes, snapped a picture with my iPhone, and the rest was history.

More advisors and investors caught onto the idea and started writing their own financial plans on a single index card.

I love the exercise, because it makes you think about what's important and forces you to be succinct.

So, here's my index-card financial plan:


Everything else is details. 

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