The money is in headphones

Benedict Evans on Apple's $3bn acquisition of Beats:

In parallel, of course, the actual value of content - music in particular - is dwarfed by the value of the smartphone explosion. The iPhone alone generated $26bn in revenue last quarter - the entire recorded music industry brought in about $17bn in 2013, and the last three quarters of iPhone sales brought in more hardware revenue than the iPod in its entire history.

And...

This is what the people behind Beats Music may have caught on to - the money is in headphones, not the tracks they play.

Source: ben-evans.com