MOG is in acquisition talks with Beats Electronics and HTC

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MOG Inc., an on-demand music service based in Berkeley, is in talks to be acquired by headphone company Beats Electronics and Taiwanese cellphone manufacturer HTC Corp., according to an industry executive familiar with the negotiations.

A MOG spokesperson did not return calls seeking comment, and a representative for Beats could not be reached.

MOG, which launched its service two years ago, has struggled along with several other digital music services to find an audience. The company does not disclose its subscriber figures, but music executives familiar with the service say MOG has fewer than half a million paying customers.

Beats, based in Los Angeles, was created by musician Dr. Dre and Jimmy Iovine, chairman of Interscope Geffen A&M Records, in 2006 as a seller of premium headphones, called Beats by Dr. Dre, manufactured by Monster Cable Products Inc. Monster, Hewlett-Packard Co., Chrysler Group and HTC are also partners in Beats.

Purchasing MOG would allow Beats and HTC to package a music service with their devices, making their products more appealing in the hypercompetitive world of mobile electronics.

The discussions are preliminary and may not lead to a deal, said an executive who asked not to be identified because the talks were confidential.

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