The apples come together
（BusinessWeek Feb 5, 2007）
The 30-year legal battle between the two companies known as Apple—the California maker of computers and iPods, and the London guardian of the musical legacy of the Beatles—has come to a close.
Having fought intermittently over the appropriate way to divide the rights to the Apple name on each of its products, the two companies say they have reached an amicable settlement that will assign all trademarks to Apple Inc. (AAPL). The deal calls for certain trademarks to be licensed back to Apple Corps for continued use. Financial terms were not disclosed, but the two companies say each will pay its own legal fees, which have amounted to around $6 million.
Rumors have been flying in recent weeks that a settlement of their latest legal spat may pave the way for the arrival of the Beatles’ musical catalog on Apple’s iTunes Store, but no details were released on whether that debut was imminent.
During the trial, Neil Aspinall, head of Apple Corps, disclosed that the company was in the process of remastering the Beatles catalog for digital distribution. Apple’s iTunes would appear to be the most likely candidate to maximize sales. However, RealNetworks (RNWK) has secured the rights to distribute the solo works of John Lennon.
But bringing the music to iTunes isn’t as clear a proposition as it might seem on first glance. Many of the distribution and publishing rights to the songs are controlled by Sony/ATV, a holding company that had been partially controlled by the singer Michael Jackson. Last year, Jackson gave Sony the option to purchase his portion of the Sony/ATV joint-venture. Sony has yet to decide whether to buy Jackson’s stake.
Meanwhile, the clock is ticking on the rights to Beatles music. Additionally, only six years remain on British copyright protection on the first batch of Beatles tunes released in 1963, unless the British government reverses its position on extending copyrights beyond 50 years after a work’s release. If left unchanged,It appears that the time to cash in on digital sales via services like iTunes is starting to evaporate , especially if the music is set to start leaking into the public domain in the country where it was originally produced.
Speculation has been rife about what Apple might do were it to sign a deal to add the Beatles catalog to iTunes. Clearly Apple’s high-impact advertising machine could structure a campaign designed to make an Apple-Apple digital music tieup a major event.
What’s more, a digital media alliance with the Beatles might not only entail music, but a good deal of video content. The Beatles starred in several feature films. In addition to movies, there are several concert performances and TV appearances that could be released on iTunes if rights agreements are reached.
In 2003 some 500 tapes containing approximately 80 hours of unreleased Beatles material stolen in the 1970s were recovered in the Netherlands. Clearly, the long and winding road connecting the two Apples hasn’t come to an end.
