Smartphone manufacturer HTC is making a strategic tie-up with Beats Electronics, buying a 51% stake for $309 million.
Beats Audio (founded by music producers Jimmy Iovine and Dr. Dre) is the highly popular headphone and a digital audio technology company that has been seen recently in many HP laptops and even the new HP TouchPad.
HTC and Beats have been working together to create superior mobile audio experiences for consumers, which will result in a line of HTC devices integrated with Beats sound innovations, available this fall.
“With the magic of mobile devices, it is easier than ever to discover and buy new music,” HTC CEO Peter Chou said in an interview with AllThingsD on Wednesday. “However, without great sound experience, it is a shame.”
The partnership is the latest move by HTC to strengthen its brand, particularly in the U.S. Although the company has seen fast-growing sales and gained ground against big-name cellphone makers, it remains less well known than rivals such as Samsung and Motorola. Chou said the Beats deal should “help create an emotional connection to HTC’s brand.”
HTC has been on an acquisition streak this year, having most recently acquired graphics chip maker S3 Graphics for $300 million and cloud-computing company Dashwire for up to $18.5 million. In both cases, analysts stated that the buys were made to own the companies’ patent portfolio, a move that hopefully bodes well for HTC, which is trying to better position its products in a booming smartphone market.