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By JESSICA MINTZ and RYAN NAKASHIMA, AP Business Writers Jessica Mintz And Ryan
Nakashima, Ap Business Writers Tue Nov 16, 6:54 pm ET
LOS ANGELES Nearly 50 years after the Beatles took television by storm, the
Fab Four's songs became available on iTunes on Tuesday, setting the stage for a
possible new outbreak of Beatlemania this one online.
After many a hard day's night of negotiations, Apple announced a deal Tuesday
to immediately begin selling the Beatles' music by the song or the album. Until
now, the biggest-selling, most influential group in rock history has been
glaringly absent from iTunes and other legal online music services.
"The Beatles are one of those groups that parents and young people can kind of
come together on, no pun intended," said Craig Marks, editor of Billboard
magazine. "There are kids and there are baby boomers and people in between who,
for whatever reason, never did download those Beatles songs because they
weren't on iTunes, and now they're going to have the opportunity to do so."
Within hours of their availability Tuesday, eight Beatles recordings were at
one point among the top 25 albums sold on iTunes, including a $149 boxed set at
No. 13. The eight also included "Abbey Road," "The White Album" and "Sgt.
Pepper's Lonely Hearts Club Band."
Apple would not release first-day sales figures or the number of Beatles albums
or singles downloaded. ITunes' top albums list is a fluid, real-time chart that
changes several times throughout the day; the 25th album may sell only a few
thousand copies in a week.
It is unclear how big the Beatles could become on iTunes. After all, many
Beatles fans already have copied the group's CDs to their iPods.
"It seems like too little, too late," said Kerry Sullivan, 24, a senior at
Saint Thomas Aquinas College in Sparkill, N.Y. "Everyone who wants the Beatles
catalog probably already has it. If, you know, they really wanted the Beatles,
they know somewhere else to get it already."
Forty years after the Beatles broke up, Apple is selling 13 remastered studio
albums, the two-volume "Past Masters" set and the "Red" and "Blue"
greatest-hits collections. People can buy individual songs for $1.29 apiece or
download entire albums, at $12.99 for a single album and $19.99 for a double.
Apple is also selling a special digital boxed set that includes all the albums
and a download of the 41-minute movie of the Beatles' first U.S. concert, "Live
at the Washington Coliseum, 1964."
Apple struck the agreement after on-and-off negotiations with the Beatles'
recording label, EMI Group, and their management company, Apple Corps.
Apple Corps had resisted selling Beatles music on iTunes in part because of a
long-running trademark dispute with Apple. The feud was resolved in 2007 when
the companies agreed on joint use of the apple logo and name. Many people saw
that as paving the way for an agreement for online access to Beatles songs.
EMI Group CEO Roger Faxon would not say whether the Beatles had gotten a
special deal from Apple, which usually keeps 30 percent and gives the rest to
the label and the artists.
Even without digital sales, the band was making money. The Beatles have sold
600 million albums worldwide since the 1960s, and last year's remastered
versions sold 18 million. Cirque du Soleil used Beatles music for the
soundtrack to its "Love" show. And "The Beatles: Rock Band" video game came out
last year.
Lance Grode, a lawyer who worked for the firm that represented Beatle George
Harrison in the late 1970s, said there was fear that once the Beatles embraced
iTunes, the music would be so easily available that it would be harder to
promote such special releases.
But ultimately, Grode said, the Beatles probably concluded that "there was too
much money being left on the table. This is a money play, pure and simple."
In a statement, the two surviving Beatles Paul McCartney and Ringo Starr as
well as Yoko Ono, John Lennon's widow, and Harrison's widow, Olivia, all gave
the deal their blessing.
"I am particularly glad to no longer be asked when the Beatles are coming to
iTunes," Starr said.
The deal gives Apple a sweet public relations boost at the start of the holiday
shopping season, but sales of Beatles music probably won't make much of a
financial impact on the company.
Brian Marshall, an analyst for Gleacher & Co., said he believes Beatles fans
with iPods and other digital music players have already converted their CDs
into digital tracks.
Even if people do rush to their computers for a "Yellow Submarine" fix, iTunes
is not a big moneymaker for Apple compared with its other businesses. In the
most recent quarter, Apple's revenue was $20.3 billion, and iTunes sales made
up just 5 percent, Marshall said.
For the music industry, the arrival of the Beatles for download might mean even
less.
"The digital music market and the young music fans record labels desperately
need to get engaged need new music products, not yesteryear's hits
repackaged," said Mark Mulligan, a Forrester analyst.
Moreover, about 90 percent of music online is downloaded illegally, music
lawyers say.
Steve Gordon, a former Sony Music business executive and author of "The Future
of the Music Business," said the Beatles-iTunes deal could generate as little
as $5 million in the first year. "Sure, there'll be a preliminary burst of
sales," he said. "If it's enough to bring the music industry back is another
issue."
Younger fans may not buy Beatles albums, but that doesn't mean they're not
listening.
Glenn Gass, a professor of music at Indiana University, has seen enrollment
grow in the Beatles course he has taught since 1982. He is now teaching
children of baby boomers raised on the Beatles.
"The Beatles are very approachable, accessible to kids," Gass said. "The
melodies are so catchy. The songs have such personalities that an 8-year-old
could love them."
Garth Brooks, Kid Rock and AC/DC are among the remaining major artists who
refuse to sell their work through Apple. Some want more control over prices or
the ability to force shoppers to download entire albums instead of individual
songs.
Steve Jobs, Apple's CEO, couldn't resist celebrating the Beatles' arrival with
an obvious quip Tuesday. "It has been a long and winding road to get here," he
said in a statement. "Thanks to the Beatles and EMI, we are now realizing a
dream we've had since we launched iTunes 10 years ago."