In 2011, NPD Group reported that Beats' market share was 64% in the U.S. for headphones priced higher than $100, and the brand was valued at $1 billion in September 2013.

Concurrently, Carlyle Group replaced HTC as a minority shareholder, alongside Dr. Dre and Iovine in late 2013.

Beats was established in 2006 by music producer Dr. Dre and record company executive Jimmy Iovine.

Iovine sought the opinions of musicians with "great taste", such as M.I.A., Pharrell Williams, will.i.am, and Gwen Stefani during the early developmental stage.

[5] Beats initially partnered with inventor Noel Lee and his company Monster Cable, an audio and video component manufacturer based in Brisbane, California, to manufacture and develop the first Beats-branded products, and debuted its first product, Beats by Dr. Dre Studio headphones, on July 25, 2008.

[5][6][7][8] Beats' use of endorsements by musicians helped the company aggressively target the young adult demographics.

On January 19, 2012, BusinessWeek reported that Beats and Monster would not renew their production contract and their partnership ceased at the end of 2012.

Dre and Iovine subsequently decided to oversee the entire operation of the company, from manufacturing to R&D,[12] and aimed to double its workforce to around 300 employees.

Monster would ultimately begin marketing its own competing line of premium headphones aimed towards an older demographic.

Iovine also commented on how other headphone makers had attempted to emulate Beats' celebrity endorsement business model (including Monster themselves, who unveiled Earth, Wind and Fire and Miles Davis-themed headphones at the 2012 Consumer Electronics Show),[6] stating that "some of our competitors are cheap engineers who have never been to a recording studio.

"[6][13][14] Following the decision to transform Beats into an autonomous entity, the company's revenues reached the $1 billion mark, according to Iovine.

[12] In July 2012, HTC sold back half of its stake in Beats for $150 million, remaining the largest shareholder with 25.1 percent.

[15] The sale was intended to provide "flexibility for global expansion while maintaining HTC's major stake and commercial exclusivity in mobile".

[10] In August 2013, reports surfaced that Beats' founders planned to buy back HTC's remaining minority stake in the company, and pursue a new, unspecified partner for a future investment.

[20] The appointment of a new chief operating officer (COO), a role previously filled by Wood,[12] was announced in early November 2013.

[23] Prior to the launch of the service, Beats stated that it intends to provide a different type of streaming experience to what was available on the market at the time.

Some reports suggested that the reduction in value may have been a result of lower-than-expected subscriber numbers for the Beats Music service.

[39][40] In July 2014, Bose Corporation sued Beats Electronics, alleging that its "Studio" line incorporated noise cancellation technology that infringed five patents held by the company.

In comparison to most headphones, Beats products were characterized by an emphasis towards producing larger amounts of bass, and are particularly optimized towards hip-hop and pop music.

Along with the Powerbeats Pro true-wireless earphones, they are part of a new generation of Beats products made from the ground up with Apple.

They also feature pure adaptive noise cancelling technology, which uses microphones both inside and outside the ear cups to measure sound levels based on the environment.

The Pill 2 had a number of accessories available, including a bike mount and a speaker stand - the "Dude" - shaped like a small wide-mouthed person.

[61] The system features a software equalizer with a preset that HP marketed as being optimized for higher quality sound output.

[65][66] The Sensation XE and Rezound were also bundled with Beats by Dre earbuds, but HTC abandoned the practice on future devices.

An HTC product executive claimed that despite the prominence of the Beats brand, "an accessory like the headphone doesn't factor in when someone is buying a smartphone".

[68] Beats audio systems are also available in models from now parent company Stellantis other brands, including Dodge and Jeep.

The comparatively high price, the merely satisfactory sound quality and the poor performance in the drop test were criticised.