Why did Apple by Beats?

Smartphones have great margins but the growth of the smartphone market is slowing. The biggest smartphone makers are targeting developing markets and also looking for profits outside of smartphones. High end headphones have huge profit margins, plus Samsung announced it's high end headphones last month.

April 28th, 2014. Hands on with Samsung's Level headphones.

http://www.pcmag.com/article2/0,2817,2457215,00.asp