Beats by Dr. Dre was founded in 2008 by Dr. Dre and Interscope-Geffen-A&M Records chairman Jimmy Iovine as an attempt to ensure the quality of the music they recorded and produced wasn't being compromised by sub-par audio equipment. Since the company launch, Monster Cable has had the exclusive license to sell Beats by Dr. Dre products. However that will change at the end of this year.
According to BusinessWeek, Noel Lee, the chief executive of Monster Cable Products, has spent CES 2012 preparing his company for a Beats-free future as a result of bad feelings between Monster and Beats. Meanwhile, Beats, whose technology can already be found in phones, laptops, and cars (and soon TVs), is ready to move on with majority stakeholder HTC.
So what happened? The story goes that neither company was particularly happy with their share of revenue, nor could they agree on who should get the most credit for the Beats line. BW reports that Lee believes Monster played a huge role in the birth of Beats by Dre. Aside from the fact that his company helped design the headphones and manufactures them, Lee says that the whole headphones idea was his in the first place. "They wanted to do speakers and I said, 'The new speaker is the headphone,'" he's quoted as saying.
However, with Beats accounting for a whopping 53-percent of the $1 billion headphone industry and audio products, mostly Beats-branded, making up 60-percent of Monster’s revenues and profits, Monster can't really afford to leave the audio/headphones business behind. As such, the company is aiming to start its own line of headphones, this time targeting the kinds of people who aren't already buying Beats or other similarly expensive headphones, namely athletes, women and business professionals.