Beats Electronics, the joint venture with Dr. Dre and Jimmy Iovine, was purchased by Apple in 2014, but when news of the partnership leaked, it cost $200 million and Diddy is reportedly to blame.
In an excerpt obtained by iMore from The New York Times reporter Tripp Mickle’s new book, After Steve: How Apple Became a Trillion-Dollar Company and Lost Its Soul, the “Forgot About Dre” rapper’s infamous video where he declared to be “the first billionaire in Hip-Hop” caused Apple to cut $200 million from the initial $3.2 billion agreement.
“It was a sum that Iovine and Dre could barely fathom. As the lawyers worked through final details, Iovine summoned the leadership team of Beats to his home near Beverly Hills. He told everyone that they were on the cusp of finalizing a massive deal. The only thing that could spoil it would be for word of the deal to leak,” the excerpt reads.
Mickle claims Iovine warned his team, “Whatever you do, don’t talk about this,” and even told Dre, “Remember that scene in Goodfellas where Jimmy tells the guys, ‘Don’t buy any furs. Don’t buy any cars. Don’t get showy’? Don’t move.”
However, the next morning, Diddy apparently called Iovine informing him that Tyrese shared a video of the Chronic rapper celebrating the deal and his newly-minted status.
“At 2:00 a.m., Iovine got a call from Puff Daddy, who was screaming that Dre and Tyrese, a rapper, were talking about the deal in a Facebook video. Iovine pulled up the video and cringed as he saw Tyrese bragging about being drunk on Heineken in a recording studio. When word of the video reached [Tim] Cook, he summoned Iovine and Dre to [Apple’s headquarters in] Cupertino.”
The excerpt continued to explain, “He invited them into a conference room for a private conversation. Iovine was anxious and afraid that Cook was going to kill the deal […] He told the music executives that he was disappointed and wished that Dre’s social media outburst hadn’t happened but said that the video hadn’t shaken his conviction that buying Beats was right for Apple.”
Cutting out $200 million from the initial deal caused Dre to not become a billionaire during the time of the deal’s closing, though reports suggest that the offer was reduced due to Beats Music’s low subscriber count.