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Beats Audio buys back controlling stake from HTC; HTC to maintain mobile exclusivity

News by Dan Seifert on Sunday July 22, 2012.

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Last year, HTC surprised the mobile industry when it announced a $300 million deal that would give it controlling stake in the Beats Audio company and allow HTC to exclusively feature Beats Audio technology in its smartphones and tablets. Many questioned whether supposedly improved audio in mobile devices was worth $300 million, and it appears that HTC eventually realized this as well, as the company has sold back to Beats half of the shares it purchased last year.

The original deal saw HTC bundling Beats headphones with its smartphones, but that practice ceased earlier this year, as HTC said that customers were not basing their smartphone purchase decisions on included headphones. It was also likely very costly to bundle Beats headphones with a smartphone, as the headphones generally retail for $100 or more on their own.

HTC has sold back 25 percent of the company to Beats, giving beats 75 percent of the company and leaving HTC with 25 percent. The buyback cost Beats $150 million, and still gives HTC exclusivity to use Beats Audio technology in its mobile devices. The two companies also still plan to work together on future products and marketing campaigns.

source: HTC, via: The Verge

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Dan Seifert
Dan is MobileBurn.com's Editor-in-Chief. Based in Poughkeepsie in New York, Dan can be found on Twitter as @DCSeifert.

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