Kanye West apparently has the inside scoop as to why Apple acquired Beats Electronics for $3 billion — to compete with Jay Z.
According to the Yeezus rapper, Apple bought the maker of the popular Beats headphones to compete with Samsung, which recently tapped Jay-Z to promote its phones.
“There would have been no Beats deal without the Samsung deal,” West said, via AppleInsider. “It showed the No. 1 company the importance of connecting with culture. The reason I said I didn’t like Samsung particularly is because throughout my entire life, because of how my parents raised me, I have to work with the No. 1. […] Samsung is not quite Apple, but it showed that Jimmy and Dre would be able to connect with the No. 1 influencers.”
As BGR notes, Kanye West has some pretty strange logic. After all, the Samsung endorsement with Jay Z cost about $20 million, small peanuts compared to the $3 billion Apple-Beats Electronics deal.
Industry experts also disagree with Kanye West on the reason Apple purchased the company. Instead of aiming for hip-hop credibility by Beats co-founder Dr. Dre on board, Apple is instead making an astute acquisition of a quickly rising company, said Peter Csathy, former president of Musicmatch, an early digital music purveyor acquired by Yahoo in 2004 for $160 million.
“Beats has a unique brand—it speaks to a nice young demographic, which is really interesting to marketers,” Csathy said. “When I think about Beats, I think about it as a lifestyle, I think of it as a media company, not just a hardware and music-focused company.”
The Beats Electronics purchase was great news for Dr. Dre, who reportedly became a billionaire from the company’s sale.
“The first billionaire in hip hop right here from the motherf***in’ West Coast,” Dre announces in a video shot by R&B artist Tyrese Gibson before the details were finalized. Tyrese posted the video on his Facebook page, but soon deleted it.
It’s not clear if the deal has truly made Dr. Dre a billionaire. Forbes estimated that the sale would double his holdings, and while that would easily make him the richest man in hip-hop, it would only leave Dr. Dre with about $800 million. That’s more than than Kanye West and Jay Z, combined.