Apple gets Beats for $3b as security questions linger

The good news for Apple today is its final closing of the deal to buy Beats, but in Australia, the question of how Apple ID credentials were obtained remains unanswered.

For US$3 billion, Beats Music, Beats Electronics, Jimmy Iovine, and Dr. Dre are now a part of Apple. After a protracted closing of the deal throughout May, Cupertino confirmed the purchase today.

"Music is such an important part of all of our lives and holds a special place within our hearts at Apple," said Apple CEO Tim Cook. "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."

The deal is expected to close later in the year, with US$2.6b of the purchase cost in cash, and US$400m in stock.

"The addition of Beats will make our music lineup even better, from free streaming with iTunes Radio to a world-class subscription service in Beats, and of course buying music from the iTunes Store as customers have loved to do for years," said Eddy Cue, Apple's senior vice president of Internet Software and Services.

However, this hasn't been the best week for Apple device users in Australia, with a number of users being woken up on Tuesday morning to an alarm sound emanating from their device, only to find it locked via the Find My iPhone feature, and a message asking for US$100 to unlock the device.

Users from Australia, New Zealand, Canada, and the US report being hit by the attack.

It is presumed that the attackers gained access to users' Apple ID credentials, and from that point on, have been able to access Apple's iCloud and the Find My iPhone service to lock the devices.

Yesterday, Apple gave an incredibly short statement for a pressing security concern, where the actual root cause is still up in the air.

In full, Apple's statement said: "Apple takes security very seriously and iCloud was not compromised during this incident. Impacted users should change their Apple ID password as soon as possible and avoid using the same user name and password for multiple services. Any users who need additional help can contact AppleCare or visit their local Apple Retail Store."

Three sentences was all that Cupertino could muster for an attack that was almost a day and a half old, while the impacted users in the community Apple support thread have taken to attempting to deduce the cause of the attack, with all the misinformation and partisanship that one would expect from a directionless goose chase conducted on the internet.

Phishing, DNS poisoning, or a man-in-the-middle attack, Apple customers in Australia are none the wiser this morning on how the incident occurred, and how they could avoid being hit by the next one.

In this particular case of Apple ID credentials falling into nefarious hands, no reasonable people are suggesting that Apple is at fault, which makes the lack of widespread communication from Apple even more baffling.

On the other hand, defaulting to silence and turning inward is standard fare for the company. Last year when Apple's developer forums suffered an intrusion, it took a weekend before Apple gave an indication of what had happened to its site.

As Apple's market share and sheer size sees it focused in attacker's sights, the company may find that its standard tactic of descending the mountain to placate its users at a time of its choosing does not hold up. We will need to wait and see though, if any company could continue to make that model work, it is Apple, even if the tactic, from the outside, doesn't appear the best way to engender trust.

Sticking to Australia and going back to the purchase of Beats, there is the issue of Telstra, and its plans to launch Beats Music in this country.

"We're looking forward to understanding the detail in due course and will work with Beats on this," Telstra told TechRepublic. "Of course we will let our customers know more information when we know more."

"MOG will continue to run as normal at this stage."

Apple said in its statement that Beats Music is "an incredible curated listening experience" -- as a subscriber to its MOG predecessor, I would certainly hope so, but given the quality of the so-called experience with its Android app, I am not hopeful.

Telstra said earlier this year that Beats Music would replace MOG before June 30.

By Chris Duckett

Some would say that it is a long way from software engineering to journalism, others would correctly argue that it is a mere 10 metres according to the floor plan. During his first five years with CBS Interactive, Chris started his journalistic adven...