All Tech Considered
9:23 am
Sat May 31, 2014

With Beats, Apple Buys A Quick Start On Smart Headphones

Originally published on Mon June 2, 2014 2:39 pm

Apple's purchase of headphone maker Beats By Dre for $3 billion is a big payday for Beats founders Jimmy Iovine and Dr. Dre. But what's in it for Apple?

Beats By Dre headphones are flashy, cool, a fashion statement. One critic called them the Air Jordans of headwear. Most reviewers, however, say Beats headphones aren't actually that good.

"Every time I've listened to them, I think, 'Oh, right, I really don't like these,' " says Whitson Gordon, editor-in-chief of Lifehacker.com.

Gordon has reviewed Beats headphones for Lifehacker, and he says they make everything sound like live music — in a bad way.

"It's almost like when you go to a concert and you're standing too close to the speakers, and you're just hearing this booming noise, and sometimes you can't even tell what song they're playing," he says. "You can't hear the mids and the highs. That's what listening to Beats is like, for me."

So why would Apple spend $3 billion for this technology, if not for the audio fidelity?

Because Apple's not really concerned with making the best-sounding headphones, says Tyll Hertsens, editor-in-chief of the audio review website InnerFidelity.com.

"Apple has a great deal of interest in putting sensors of various types in headphones and making headphones smart," Hertsens says.

Such headphones could monitor a lot about the wearer, he says.

"Temperature, pulse, perspiration, sensors for athletic tracking applications, position sensing so they can tell when your head is moving, the ability to give you cues to where things are," Hertsens says.

Earlier this year, the U.S. Patent and Trademark office gave Apple a patent for a sports monitoring system for headphones. The patent says the devices would also be able to tell when the user is speaking, or know if the headphones are on ears or off.

It's much easier for Apple to integrate that new technology with a company like Beats — which already has a big headphone infrastructure — than for the company to build it up from scratch, says Dan Frakes, senior editor of MacWorld.

"They just sort of accelerated the process from the logistical standpoint," Frakes says, "because now they've got the resources to design and produce something."

Big companies like Intel and LG already have smart headphone prototypes that they've been showing off at tech shows.

Small companies and startups are in the game as well. One European company, Bragi, just finished a successful Kickstarter campaign to fund smart wireless earbuds called The Dash. The headphones are already in preorder.

Jim Ninesling, who runs Bragi's U.S. operations, says ultimately, smart headphones won't just monitor things like heart rate — they'll actually be able to tell what the wearer is doing.

"You don't have to tell it that you're biking; it knows," Ninesling says. "You don't have to tell it that you're swimming; it knows by your body movements."

Bragi's Kickstarter campaign raised over $3 million. Ninesling says people know that smart headphones and other wearable technology — like bracelets that monitor sleep patterns — are going to be big.

The speculation is that the wearables industry will exceed $30 billion, Ninesling says. "I've heard estimates as high as $50 billion in sales revenues by 2018."

If Apple wants to, it shouldn't be that hard to grab a big chunk of that pie. Besides its dominant market share, Apple has a loyal — even rabid — customer base. If Apple and Beats By Dre decide headphones that measure heart rates and running speeds are cool, chances are lots of people will probably believe them.

Copyright 2014 NPR. To see more, visit http://www.npr.org/.

Transcript

SCOTT SIMON, HOST:

This is WEEKEND EDITION from NPR News. I'm Scott Simon. Apple confirmed this week that it plans to buy Beats By Dre for $3 billion, one of the largest acquisitions in its history. But Beats Electronics is not known for making the greatest headphones, so what's in it for Apple? Well, they get a music mogul, Jimmy Iovine, and a popular streaming service. And is NPR Sam Sanders reports, Apple also wants to get into the smart headphones business.

SAM SANDERS, BYLINE: First there was Apple with those little white earbuds.

(SOUNDBITE OF SONG, "ARE YOU GONNA BE MY GIRL")

JET: (Singing) So 1, 2, 3, take my hand and come with me because you look so fine that I really wanna make you mine.

SANDERS: Then came Beats By Dre.

(SOUNDBITE OF SONG, "IT'S ALIVE")

KENDRICK LAMAR: (Singing) I rap with a Pyrex in the projects. I'm crack in a pot, I'm a prospect. I'm a pirate...

SANDERS: Beats By Dre changed the headphone game almost overnight. They're flashy, cool, a fashion statement - as one critic said, the Air Jordans of headwear. But most reviewers say Beats headphones aren't actually that good.

WHITSON GORDON: Every time I've listened to them, I think, oh, right, I really don't like these.

SANDERS: Whitson Gordon is the editor-in-chief of lifehacker. He's reviewed Beats headphones for the site, and he says they make everything sound like live music - in a bad way.

GORDON: Yeah, it's almost like when you go to a concert and you're standing too close to the speakers. And you're just hearing this booming noise, and sometimes you can't even tell what song they're playing. And you can't hear the mids and the highs - that's what listening to Beats is like for me.

SANDERS: So, if not for the audio fidelity, why would Apple spend $3 billion for this technology?

TYLL HERTSENS: Apple has a great deal of interest in putting sensors of various types in headphones and making headphones smart.

SANDERS: That's Tyll Hertsens of the audio review website, innerfidelity.com. He says Apple's not really concerned with making the best sounding headphones, they're trying to make smart headphones - headphones that can monitor a lot about you.

HERTSENS: Temperature, pulse, perspiration, sensors for athletic tracking applications, position sensing so they can tell when your head is moving.

SANDERS: Earlier this year, the U.S. Patent and Trademark Office gave Apple a patent for a sports monitoring system for headphones. The patent says the devices would also be able to tell when the user is speaking, or know if the headphones are in your ears are not.

Dan Frakes of MacWorld says it's much easier for Apple to integrate that new technology with a company like Beats - which already has a big headphone infrastructure - than for Apple to build that up from scratch.

DAN FRAKES: They just sort of accelerated the process from the logistical standpoint because now they've got the resources to design and produce something.

SANDERS: Big companies like Intel and LG already have smart headphone prototypes that they've been showing off at tech shows.

And small companies and startups the game as well. One European company named, Bragi, just finished a successful Kickstarter campaign to fund what they call, The Dash. The headphones are already in preorder. Jim Ninesling runs Bragi's U.S. operation. Ninesling says ultimately smart headphones won't just monitor things like heart rate - they'll actually be able to tell what you're doing.

JIM NINESLING: You don't have to tell it that you're biking - it knows. You don't have to tell it you're swimming, it knows by your body movements.

SANDERS: Bragi's Kickstarter campaign raised over $3 million. Ninesling says people know that smart headphones and other quote, "wearable technology" like those bracelets that monitor your sleep patterns, are going to be big.

NINESLING: A lot of different people that are speculating that the wearables industry will exceed 30 billion - I've heard estimates as high as 50 billion in sales revenues by 2018.

SANDERS: If Apple wants to, it shouldn't be that hard for the company to grab a big chunk of that pie. Besides their dominant market share, Apple has a loyal - even rabid - customer base. So if Apple and Beats By Dre decide headphones that tell you how fast your heart beats or how good a runner you are are cool, chances are lots of people will probably believe them. Sam Sanders, NPR News. Transcript provided by NPR, Copyright NPR.