What Does the Apple/Beats Deal Mean? 6 Xxplosive Business Takeaways

Last night, news broke that Apple is in talks to buy Beats Music, Dr. Dre and Jimmy Iovine's headphone/music streaming company, for a reported sum of $3.2 billion, i.e. like at least five iPhones. Dr. Dre and Tyrese Gibson were in the studio celebrating, and they posted this video online of Dre calling himself hip-hop's first billionaire (billionaires: faded off that Heineken just like you and me):

Naturally, the business community is weighing in big time on this because if there's one thing that tantalizes those people even more than a Detox leak rumor tantalizes a hip-hop message board, it's mergers and acquisitions news. Mergers and acquisitions are the shit. With communities of thought leaders, venture capitalists, analysts, principals, investor expert men, fancy suit guys, money people, bank heads, and stock looker-atters weighing in on the issue, it seemed appropriate to make a call to Noisey's business bureau and offer our own, street-savvy take on what this means for the world of #business and also the world of #music. Here are some of the conclusions we can draw:

It's a widely known fact that all businessmanguys like rap music. They may spend their days earnestly discussing things like the market cap of Google and pretending that startups like Path are viable businesses worth tens of millions of dollars, but if there's one thing they love, it's unwinding after a long day of looping people in via email with some old school rap tunes. Whether they're vibing to the laid-back jams of A Tribe Called Quest and Jurassic 5 or blowing off some steam by blasting some N.W.A., executives and thought leaders alike enjoy showing that they are cultured by listening to rap music that sounds like it is at least 20 years old—and using slang to match. Beats becoming part of the Silicon Valley world is the perfect excuse for lots of VCs and VPs to show how hip they are by rattling off rap phrases and real hip-hop references. You can be sure we're going to hear about Dre and Snoop drinking Gin and (Apple) Juice and that the word “yo” is going to be peppered into like five times as many board meetings.

The less tied the hip-hop slang is to Dr. Dre himself, the better. Expect lots of discussion of all the bling-bling this deal is going to net, at least one headline explaining that Dr. Dre has 99 problems but Apple ain't one, and, somehow, a reference to Flava Flav. Business people love Flava Flav because they are convinced that all rappers wear clocks around their necks. There is a 90 percent chance someone in Cupertino is making a chain with an iPhone on it right now to give to Dr. Dre because they think that will the coolest thing ever. Rapper style is about to get #disrupted.

Everyone's always giving Dr. Dre a hard time about his long-awaited album Detox never coming out, but you have to cut the guy some slack: He's been hand-crafting each pair of Beats By Dre headphones for the last few years to make sure every customer gets a truly artisanal listening experience. Now that Apple's in the mix, Beats can finally afford to work with a factory and get some of that sweet Foxconn sweatshop labor. Not only does this mean that Jon Connor can go on a study abroad program to China and learn to fix iPhone screens so he has a fallback career after rap, it also means Dr. Dre can finally rest his otherwise soon-to-be-arthritic hands and get back to work evaluating the verses people ghostwrite for him.

If it seems like a lot of rappers have ventured into the startup space in the past, just wait for the interest now that an artist's tech business has landed a multibillion dollar buyout. Having a fragrance or vanity liquor brand or a clothing line is nice and everything, but everyone knows apps are where the money's at. Imagine WhatsApp but French Montana-themed. Imagine the Uber of blunts, built by Method Man. That shit would have a valuation of like $420 million. With the music industry dying, the only way to make money off of music is for it to be an app. People will be starting rap careers just so they can build buzz for their apps. Rap will rebrand as rapp. Apps will rebrand as rapps. Everything will come together to disrupt music, and the rap and app spaces will converge. Instead of software-as-a-service (SaaS), soon we'll have Soulja-Boy-as-a-service (SbaaS). Instead of Snapchat, we'll have Rapchat. Rappers will get venture capital for their mixtapes. The dream of all Silicon Valley programmer bros is that we will idolize them as much as we idolize rappers. This will never happen, but we will definitely download any app Soulja Boy releases instead of downloading Path. All the innovation in America is happening in the cloud. What better place for a rapper to be?

According to Forbes estimates, Dr. Dre's net worth from this deal will rise to around $800 million. Last fall, Forbes pegged the net worth of Paul McCartney, pop music's most valuable persona, at around $650 million. It may not be because The Chronic has sold as many copies as The White Album, but this still means that Dr. Dre is now the richest person in popular music, which is pretty cool. This is a victory for hip-hop, a big gate-crashing move and an impressive change. There are now only like three degrees of separation between Eazy E and Steve Jobs, who no doubt are in heaven sharing a 40 this very moment. Obie Trice is like two phone calls away from Tim Cook. The Beatles, meanwhile, can't say shit. I don't even have any jokes about this. It's just cool.

Ice Cube's kids are all getting iPads for Christmas this year. Same with Eminem. Eminem definitely does not know how to use an iPad. Shit, do you think Dr. Dre will be able to get iPads loaded with Flappy Bird because he's Dr. Dre? Apple's got to have a copy of Flappy Bird lying around the office somewhere that it can install on iPads if it wants to. Rappers on Aftermath are going to be bragging about all their black market apps for perpetuity now. Jon Connor will probably just abandon rapping and switch to a fallback career as a professional Fruit Ninja player. And he doesn't have to click on all those free iPad pop-up ads anymore.

Sorry, you'll still have to pay $15.99 for Detox when it comes out.

Kyle Kramer thinks you should read this article on his headphones. He's on Twitter - @KyleKramer

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