Apple buys Beats in $3b deal that sees Dr Dre and Jimmy Iovine join Apple board

THE deal is official: Apple is buying Beats for $3 billion.

The rumored deal was, again, rumored to be in doubt after video emerged of Beat's co-founder Dr Dre boasting of being rappers first billionaire.

But Apple CEO Tim Cook today announced it had bought the maker of the popular Beats headphones and the (not so popular) Beats Music streaming service for a purchase price of $2.6 billion with a further $400 million in stock.

'Music is such an important part of all of our lives and holds a special place within our hearts at Apple,” said Cook said in a statement. 'That's why we have kept investing in music and are bringing together these extraordinary teams so we can continue to create the most innovative music products and services in the world.”

Here's to the next episode. #applebeats pic.twitter.com/GaHy1G84xF — Beats By Dre (@beatsbydre) May 28, 2014

Both Beats co-founders, Dr Dre and Jimmy Iovine, will join Apple as part of the deal joining the Apple board.

'I've always known in my heart that Beats belonged with Apple,” said Iovine said in the statement.

'The idea when we started the company was inspired by Apple's unmatched ability to marry culture and technology. Apple's deep commitment to music fans, artists, songwriters and the music industry is something special.”

Since news of the deal was leaked, tech analysts have presented a collection of theories as to why Apple, which normally only buys small companies in small deals, dug so deep in its pockets for this deal.

One theory is that Apple feels it needs a streaming service to support iTunes. Another theory is that it wants the cool factor of the headphone brand, and the marketing brain of Iovine.