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Jimmy Iovine And Eddie Cue On Apple/Beats Deal

Eddie Cue and Jimmy Iovine (photo: Larry Magid)

Eddie Cue and Jimmy Iovine (photo: Larry Magid)

(Rancho Palos Verdes, CA) Edie Cue, Apple’s senior vice president of Internet Software and Services and Beats co-founder Jimmy Iovine took the stage at’s Code Conference Wednesday night to shed light on the Apple acquisition of Beats, announced a few hours earlier.

Beats makes a popular line of headphones and operates a streaming music service called Beats Music. With the deal, both Iovine and his partner, rapper Dr. Dre (Andre Romelle Young), become Apple employees.

When asked by Code co-host Walt Mossberg why Apple acquired Beats Music rather than start its own service, Cue said “We don’t do everything… We saw an opportunity with Beats that’s unique. We thought that could really accelerate us.”

Iovine was upbeat about Apple. “We’re creating something that has to have a feel. Apple has a lot of information about music and what people listen to and what they like.” He also quipped “We wanted to move into a better neighborhood so I made a deal with Apple.” Iovine said that Apple “Moves like a small company but it’s gigantic.”

It’s quite the neighborhood. The deal, worth $3 billion, represents a big pay day for Iovine and Dre.

Cue and Iovine have been working together for a decade on a variety of music projects and when asked why they did the deal now, Iovine responded, ”How does someone date for 10 years and just get married. It happens.

When asked if Apple was buying Beats for the cool factor, Cue said “I don’t think you buy cool. You make the best products in the world and customers love them.”

Cue also said that the Beats music service would remain on the Android platform. “It’s on Android now, and we want to keep it that way.”

On his partnership with Dr. Dre, Iovine said that ”We shared something and it wasn’t music. It was the dream of music.”

With Beats, Apple gets both a streaming music service and a headphone business. Cue told the  group of tech luminaries gathered at Code that Apple thinks “there’s a huge opportunity in headphones.” Iovine criticized the earbuds that companies like Apple bundle with their devices saying, “they make headphones to see if the machine works.”

And, when asked what he thinks of the relationship between Hollywood and Silicon Valley, Iovine delivered one of the best lines of the night. “In the music business everyone is desperately insecure but the guys in Silicon Valley seem to be over confident.” Cue sees a “lack of respect on both sides.”