Apple to cut 200 jobs at Beats Electronics
Apple (AAPL) announced in May that it would buy Beats Electronics, the headphone and music accessory company started by rapper Dr. Dre and recording industry insider Jimmy Iovine, for $3 billion. Now that the initial excitement has subsided, the other shoe has dropped: Apple will cut approximately 200 jobs at Beats, out of more than 700 jobs in total.
Apple has not yet responded to CBS MoneyWatch requests for a comment. However, the blog 9To5Mac, which broke the story, reported that it had received a statement from the company:
We're excited to have the Beats team join Apple, and we have extended job offers to every Beats employee. Because of some overlap in our operations, some offers are for a limited period and we'll work hard during this time to find as many of these Beats employees as we can another permanent job within Apple.
Apple's comment did not confirm the number of people who could lose their jobs and there is no indication of how many might ultimately find positions at the company.
Cutting redundant positions after an acquisition is nothing new in the corporate world. Two companies always have equivalent jobs: Accounting or shipping, for example. Keeping the duplicate functions makes no sense, so some number of people are always let go. It is in the infrastructure areas, including human resources, finance, and legal, where Beats employees are most likely to ultimately lose a job, according to Billboard.
The length of temporary employment is unclear. According to Billboard, Beats employees who don't get a permanent job with Apple could still have work for between three months and a year.
According to 9To5Mac, there will be plenty of work for some, particularly those in the music streaming part of Beats. That technology is apparently not compatible with that of Apple, so much of the systems will need to be completely redesigned.
This isn't the only bit of notoriety the deal has received. Last month, Bose filed a patent infringement suit against Beats over alleged infringement of noise-cancelling technology.