Beats Electronics (@beatsbydre) Acquires Music Service Mog
Music subscription service Mog has been acquired by Beats Electronics. Terms of the deal, which first made the news back in March, were not disclosed.
Mog founder and CEO David Hyman will stay on as CEO and report to Beats president and COO Luke Wood. Beats Electronics was founded in 2008 by CEO Jimmy Iovene and producer/recording artist Dr. Dre. Many of the company’s products, such as its popular over-the-ear headphones, are sold under the Beats By Dr. Dre name.
The deal gives Mog an inside track to millions of music lovers and smartphone owners. Beats By Dre, a popular brand in its own right, received a $300 million investment from smartphone manufacturer HTC in August 2011. Beats Audio, the Beats By Dre high-quality audio technology, is now available in some HTC devices. “We’ve since expanded the Beats mission to every other link in the music experience chain – speakers, mobile phones, personal computers and automobile sound systems,” Wood said in a statement announcing the deal. “With Mog, we are adding the best music service to the Beats portfolio for the first truly end-to-end music experience. With their talent and technology, the possibilities around future innovation are endless.”
Although terms of the deal have not been released, it appears Mog’s investors — who include Sony Music and Universal Music Group — may have taken a loss. The Los Angeles Times put the amount of the deal at $10 million. Sources told GigaOm back in March the discussed price was as low as $14 million but possibly higher. Both figures are well below the $24.9 million of investments in Mog listed at its CrunchBase profile.
Mog has not released subscriber figures but industry sources have told Billboard.biz the service ranks well behind subscription leaders Rhapsody, Spotify and Muve Music. The last public figure Mog gave was 160,000 average monthly users, a number that includes both paying subscribers and users of its free on-demand service. It launched in December 2009 as a paid subscription service and introduced free on-demand listening in September 2011.