Apple buys Beats Electronics for a reported $3.2 billion

Mike Snider, USA TODAY

beatsexecs

Beats Electronics executives, President and COO Luke Wood and co-founders Dr. Dre and Jimmy Iovine.(Photo11: Beats Electronics)


Apple is set to acquire headphone maker and music company Beats Electronics for a reported $3.2 billion.

The acquisition could be announced as early as next week, the Financial Times reported, based on people familiar with the negotiations. USA TODAY independently confirmed the talks through a source who is not authorized to speak publicly about it.

If consummated, Apple’s purchase of Beats could represent the company’s largest acquisition ever. Apple and Beats declined to comment on the report.

Music mogul Jimmy Iovine and producer-rapper Dr. Dre co-founded Beats Electronics seven years ago and launched the high-end headphones craze. Earlier this year,they launched Beats Music, a premium music-streaming service.

Should the acquisition go through, it would be ironic in a way. Dre and Iovine came up with the idea for Beats by lamenting the decline in sound quality ushered in by Apple’s own iPod and the MP3 era.

“For convenience and speed, everyone sacrificed sound,” Iovine told USA TODAY three years ago. “The emotion of the music is almost unrecognizable to what is recorded in the studio,” said Iovine, who is the chairman of Interscope/Geffen/A&M records.

The two set out to market headphones that reproduce, Iovine said, “as close to the sound I hear in the studio as possible.”

They introduced the original $300 Beats Studio model in 2008 and since then, Beats has expanded its lineup to include other headphones with the help of Lady Gaga, LeBron James and Justin Bieber, as well as portable speakers and even music-processing technology for cars, computers and smartphones.

In launching Beats Music in January, Iovine told USA TODAY that “with the headphones, we hit an emotional chord with hardware. Now, it’s all about completing a circle and giving people the full experience of music.”

This would be Beats second go-round with a phone maker. Electronics maker HTC bought half the company in 2011 for $300 million, and Beats Audio was introduced to cellphones. Last year, Beats bought back all of HTC’s share of the company and got a reported $500 million investment from The Carlyle Group.

The report was met with mixed responses on Twitter Thursday night. Buzzfeed business editor Peter Lauria tweeted, “Ouch..9 months ago, HTC sold its stake in Beats for $265 million..now Apple is going to buy Beats for $3.2 billion.”

GigaOm founder and True Ventures partner Om Malik tweeted: “Google spends $3.2 billion to buy the future & data. Apple buys bad headphones & a junk-service from music promoters. Worse use of corp $$$s.”

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Tech Help LA 790AM KABC

What Is the Heartbleed Encryption Bug?

Social Networks

Was it affected? Is there a patch? Do you need to change your password? What did they say?
Facebook Unclear Yes YesYes “We added protections for Facebook’s implementation of OpenSSL before this issue was publicly disclosed. We haven’t detected any signs of suspicious account activity, but we encourage people to … set up a unique password.”
Instagram Yes Yes YesYes “Our security teams worked quickly on a fix and we have no evidence of any accounts being harmed. But because this event impacted many services across the web, we recommend you update your password on Instagram and other sites, particularly if you use the same password on multiple sites.”
LinkedIn No No No “We didn’t use the offending implementation of OpenSSL in http://www.linkedin.com or http://www.slideshare.net. As a result, HeartBleed does not present a risk to these web properties.”
Pinterest Yes Yes YesYes “We fixed the issue on Pinterest.com, and didn’t find any evidence of mischief. To be extra careful, we e-mailed Pinners who may have been impacted, and encouraged them to change their passwords.”
Tumblr Yes Yes YesYes “We have no evidence of any breach and, like most networks, our team took immediate action to fix the issue.”
Twitter No Yes Unclear Twitter wrote that OpenSSL “is widely used across the internet and at Twitter. We were able to determine that [our] servers were not affected by this vulnerability. We are continuing to monitor the situation.” While reiterating that they were unaffected, Twitter toldMashable that they did apply a patch.

Other Companies

Was it affected? Is there a patch? Do you need to change your password? What did they say?
Apple No No No “iOS and OS X never incorporated the vulnerable software and key web-based services were not affected.”
Amazon No No No “Amazon.com is not affected.”
Google Yes Yes YesYes* “We have assessed the SSL vulnerability and applied patches to key Google services.” Search, Gmail, YouTube, Wallet, Play, Apps and App Engine were affected; Google Chrome and Chrome OS were not.

*Google said users do not need to change their passwords, but because of the previous vulnerability, better safe than sorry.

Microsoft No No No Microsoft services were not running OpenSSL, according to LastPass.
Yahoo Yes Yes YesYes “As soon as we became aware of the issue, we began working to fix it… and we are working to implement the fix across the rest of our sites right now.” Yahoo Homepage, Yahoo Search, Yahoo Mail, Yahoo Finance, Yahoo Sports, Yahoo Food, Yahoo Tech, Flickr and Tumblr were patched. More patches to come, Yahoo says.

Email

Was it affected? Is there a patch? Do you need to change your password? What did they say?
AOL No No No AOL told Mashableit was not running the vulnerable version of the software.
Gmail Yes Yes YesYes* “We have assessed the SSL vulnerability and applied patches to key Google services.”

*Google said users do not need to change their passwords, but because of the previous vulnerability, better safe than sorry.

Hotmail / Outlook No No No Microsoft services were not running OpenSSL, according to LastPass.
Yahoo Mail Yes Yes YesYes “As soon as we became aware of the issue, we began working to fix it… and we are working to implement the fix across the rest of our sites right now.”

Stores and Commerce

Was it affected? Is there a patch? Do you need to change your password? What did they say?
Amazon No No No “Amazon.com is not affected.”
Amazon Web Services(for website operators) Yes Yes YesYes Most services were unaffected or Amazon was already able to apply mitigations (see advisory note here). Elastic Load Balancing, Amazon EC2, Amazon Linux AMI, Red Hat Enterprise Linux, Ubuntu, AWS OpsWorks, AWS Elastic Beanstalk and Amazon CloudFront were patched.
eBay No No No “eBay.com was never vulnerable to this bug because we were never running a vulnerable version of OpenSSL.”
Etsy Yes* Yes YesYes Etsy said that only a small part of its infrastructure was vulnerable, and they have patched it.
GoDaddy Yes Yes YesYes “We’ve been updating GoDaddy services that use the affected OpenSSL version.” Full Statement
Groupon No No No “Groupon.com does not utilize a version of the OpenSSL library that is susceptible to the Heartbleed bug.”
Nordstrom No No No “Nordstrom websites do not use OpenSSL encryption.”
PayPal No No No “Your PayPal account details were not exposed in the past and remain secure.”Full Statement
Target No No No “[We] launched a comprehensive review of all external facing aspects of Target.com… and do not currently believe that any external-facing aspects of our sites are impacted by the OpenSSL vulnerability.”
Walmart No No No “We do not use that technology so we have not been impacted by this particular breach.”

Videos, Photos, Games & Entertainment

Was it affected? Is there a patch? Do you need to change your password? What did they say?
Flickr Yes Yes YesYes “As soon as we became aware of the issue, we began working to fix it… and we are working to implement the fix across the rest of our sites right now.”
Hulu No No No No comment provided.
Minecraft Yes Yes YesYes “We were forced to temporary suspend all of our services. … The exploit has been fixed. We can not guarantee that your information wasn’t compromised.”More Information
Pandora No No No No comment provided.
Netflix Yes Yes YesYes “Like many companies, we took immediate action to assess the vulnerability and address it. We are not aware of any customer impact. It’s a good practice to change passwords from time to time, now would be a good time to think about doing so. “
SoundCloud Yes Yes YesYes SoundCloud emphasized that there were no indications of any foul play and that the company’s actions were simply precautionary.
YouTube Yes Yes YesYes* “We have assessed the SSL vulnerability and applied patches to key Google services.”

*Google saidusers do not need to change their passwords, but because of the previous vulnerability, better safe than sorry.

Financial

All the banks we contacted (see below) said they were unaffected by Heartbleed, but U.S. regulators have warned banks to patch their systems.

Was it affected? Is there a patch? Do you need to change your password? What did they say?
American Express No No No “There was no compromise of any customer data. While we are not requiring customers to take any specific action at this time, it is a good security practice to regularly update Internet passwords.”
American Funds Yes Yes YesYes American Fundstold customers to change their username and passwords, as the company “learned of a very narrow window of risk to those who logged into americanfunds.com between December 12, 2013 and April 14, 2014.”
Bank of America No No No “A majority of our platforms do NOT use OpenSSL, and the ones that do, we have confirmed no vulnerabilities.”
Barclays No No No No comment provided.
Capital One No No No “Capital One uses a version of encryption that is not vulnerable to Heartbleed.”
Chase No No No “These sites don’t use the encryption software that is vulnerable to the Heartbleed bug.”
Citigroup No No No Citigroup does not use Open SSL in “customer-facing retail banking and credit card sites and mobile apps”
E*Trade No No No E*Trade is still investigating.
Fidelity No No No “We have multiple layers of security in place to protect our customer sites and services.”
PNC No No No “We have tested our online and mobile banking systems and confirmed that they are not vulnerable to the Heartbleed bug.”
Schwab No No No “Efforts to date have not detected this vulnerability on Schwab.com or any of our online channels.”
Scottrade No No No “Scottrade does not use the affected version of OpenSSL on any of our client-facing platforms.”
TD Ameritrade No No No TD Ameritrade “doesn’t use the versions of openSSL that were vulnerable.”
TD Bank No No No “We’re currently taking precautions and steps to protect customer data from this threat and have no reason to believe any customer data has been compromised in the past.”
T. Rowe Price No No No “The T. Rowe Price websites are not vulnerable to the “Heartbleed” SSL bug nor were they vulnerable in the past.”
U.S. Bank No No No “We do not use OpenSSL for customer-facing, Internet banking channels, so U.S. Bank customer data is NOT at risk.”
Vanguard No No No “We are not using, and have not used, the vulnerable version of OpenSSL.”
Venmo Yes Yes YesYes Venmo sent an email to its users, saying the company took “immediate steps to patch the potential vulnerability” and recommended that they change their passwords.
Wells Fargo No No No No reason provided.

Government and Taxes

Was it affected? Is there a patch? Do you need to change your password? What did they say?
1040.com No No No “We’re not vulnerable to the Heartbleed bug, as we do not use OpenSSL.”
FileYour Taxes.com No No No “We continuously patch our servers to keep them updated. However, the version we use was not affected by the issue, so no action was taken.”
H&R Block No No No “We are reviewing our systems and currently have found no risk to client data from this issue.”
Healthcare .gov No No No “Healthcare.gov consumer accounts are not affected by this vulnerability.”
Intuit (TurboTax) No No No Turbotax wrotethat “engineers have verified TurboTax is not affected by Heartbleed.” The company has issued new certificates anyway, and said it’s not “proactively advising” users to change their passwords.
IRS No No No “The IRS continues to accept tax returns as normal … and systems continue operating and are not affected by this bug. We are not aware of any security vulnerabilities related to this situation.”
TaxACT No No No “Customers can update their passwords at any time, although we are not proactively advising them to do so at this time.”
USAA Yes Yes YesYes USAA said that it has “already taken measures to help prevent a data breach and implemented a patch earlier this week.”

Other

Was it affected? Is there a patch? Do you need to change your password? What did they say?
Box Yes Yes YesYes “We’re currently working with our customers to proactively reset passwords and are also reissuing new SSL certificates for added protection.”
Dropbox Yes Yes YesYes On Twitter: “We’ve patched all of our user-facing services & will continue to work to make sure your stuff is always safe.”
Evernote No No No “Evernote’s service, Evernote apps, and Evernote websites … all use non-OpenSSL implementations of SSL/TLS to encrypt network communications.”Full Statement
GitHub Yes Yes YesYes GitHub said it has patched all its systems, deployed new SSL certificates and revoked old ones. GitHub is asking all users to change password, enable two-factor authentication and “revoke and recreate personal access and application tokens.”
IFTTT Yes Yes YesYes IFTTT emailed all its users and logged them out, prompting them to change their password on the site.
OKCupid Yes Yes YesYes “We, like most of the Internet, were stunned that such a serious bug has existed for so long and was so widespread.”
Spark Networks (JDate, Christian Mingle) No No No Sites do not use OpenSSL.
SpiderOak Yes Yes No Spideroak said it patched its servers, but the desktop client doesn’t use a vulnerable version of OpenSSL, so “customers do not need to take any special action.”
Wikipedia(if you have an account) Yes Yes YesYes “We recommend changing your password as a standard precautionary measure, but we do not currently intend to enforce a password change for all users.” Full Statement
WordPress Yes Yes YesYes WordPressconfirmed that it was vulnerable to Heartbleed and that it has patched its servers “within a few hours of the public disclosure.” WordPress is not forcing users to change their passwords, but said users “are welcome” to do it.
Wunderlist Yes Yes YesYes “You’ll have to simply log back into Wunderlist. We also strongly recommend that you reset your password for Wunderlist.” Full Statement

Password Managers

Was it affected? Is there a patch? Do you need to change your password? What did they say?
1Password No No No 1Password said in a blog postthat its technology “is not built upon SSL/TLS in general, and not upon OpenSSL in particular.” So users don’t need to change their master password.
Dashlane Yes Yes No Dashlane said in a blog post users’ accounts were not impacted and the master password is safe as it is never transmitted. The site does use OpenSSL when syncing data with its servers but Dashlane said it has patched the bug, issued new SSL certificates and revoked previous ones.
LastPass Yes Yes No “Though LastPass employs OpenSSL, we have multiple layers of encryption to protect our users and never have access to those encryption keys.” Users don’t need to change their master passwords because they’re never sent to the server. But passwords for other sites stored in LastPass might need to be changed.

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