Video After The Jump
Written by Tanya Benedicto Klich for Entrepreneur.com
For Curtis "50 Cent" Jackson, entering the high-end audio market hasn't been easy but the competitive rapper recently secured a strategic partnership that may give his headphone venture the solid footing needed to take on rivals.
The rapper purchased fashion headphone company Kono Audio to launch his own consumer electronics company in late 2011, one that would be named SMS Audio. SMS, which stands for studio-mastered sound, was off to a rough start after 50 had to settle a hefty $16 million lawsuit in late 2014 for a deal gone sour with Sleek Audio, and continued to face stiff competition from a market glutted with celebrity-endorsed headphones. Thanks to the success of Beats by Dre, the personas of everyone from Bob Marley to Lady Gaga have been used to forge this new market of headphones that often cost $300 or more.
While SMS counts celebrities like music producer Timbaland and NBA star Carmelo Anthony as celebrity investors, the headphone manufacturer would need much more than star power to compete, especially after Apple purchased Beats by Dre last year for $3 billion. Beats commands a 27% market share of the headphones market, according to CNN. Also, the report cites market research from the NPD Group that shows it controls more than half of the market for “luxury” headphones.
To counter, SMS partnered with Intel in December 2014 to develop sports-and fitness-related headphones. More recently, 50 Cent is taking a different tack to distinguish his company. Just this March it inked a multi-year partnership with Walt Disney Parks and Resorts and Lucasfilm’s Star Wars. In this quick video, 50 Cent chats about the surprising deal and how his startup teamed with a major corporation.
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