Where to go after Monster and Beats end headphone partnership

Beats Electronics and Monster Cable Products, two companies that together defined the current $1-billion headphone industry with the Beats by Dr.dre line, are parting ways after five years partnership.

Beats has been the biggest name in headphones over the last couple of years, heavily popularized by co-owner Dr.dre.

The partnership built on the audio expertise of Monster, which Hi-Fi fans will know was already a big name in the cable world.

Monster has manufactured the Beats headphones under exclusive licence since they were launched in 2009.

The partnership has so far proved hugely lucrative, helping Monster - the producer of audio and video cabling products - to take almost 80% of the US headphone market, according to the NPD group.

However, the partnership with Beats has now come to an end. Sources told Business Week that the split happened because of a disagreement over money and credit, with each company believing it deserved more of both.

Bloomberg cites people close to the situation as saying that the two firms have squabbled over who "deserves the most credit for the line's success", while Beats has grown dissatisfied with its share of the revenue.

In fact, Cooperation can succeed, mainly depending on complementing each other with advantages.

Monster is responsible for the productions and helps designs the headphones, and even claims that it originally dissuaded Dr.dre from making Hi-Fi speakers, instead urging them to focus on the headphones market.

Beats majors in the brand and fashion, just as what Ben Arnold, director of industry analysis for NPD say. "Now a big part of what you're paying for is the brand and fashion."

Justin Bieber and Lady Gagahave both designed special Beats headphones, while, Olympic swim champion in London Yang Sun, US basketball star Kobe Bryant, Ming Yao and even the late Apple founder Steve Jobs have been pictured wearing them.

After the split, Monster isn't over the hill. Monster is going to move ahead and attempt to rebuild a headphone empire range with eight different lines. That's the short-term plan. The long-term plan isn't clear but one fairly obvious move would be to merge with or buy out SOL Republic, a headphone company founded by Kevin Lee who happens to be son of Monster founder Noel Lee.

Monster chief executive Noel Lee told Bloomberg, "We're competing with ourselves. We can be the Apple of the headphones space, with or without Beats."

Following the split, Beats will retain the rights to the bass-heavy sound technology, the circular headphone can design and the brand. The Mixr headphones and wireless release of the Solo headphones are their latest achievement. In 2012, they plan a style of the Mixr, which is the only artist-specific set of headphones.

Furthermore, Beats has agreed deals to bring its audio technology to computers made by Hewlett-Packard, the Chrysler 300 S sedan car and HTC smart phones, after the Taiwanese mobile firm bought a 51% stake in Beats last year for $300 million.

However, the road forward Beats is tortuous, professional notes. The company will surely continue to license its brand out, but who will make headphones is unclear. It just so happens to be majority owned by HTC and HTC just so happens to be a manufacturer of consumer electronics. Even if HTC and Beats don't decide to go down that road, you can be sure that given the amount of money and market share that Beats has managed to snatch up, they'll find a way to ensure that there are many more Beats-branded headphones to come.