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Wed, Feb 07, 2007 - Page 10 News List

Apple, Beatles settle squabble

STILL OFF KEY The deal could finally pave the way for the Fab Four's songs to be sold on the iTunes music store -- sometime

AP , SAN JOSE, CALIFORNIA

For the third time in nearly three decades, iPod maker Apple Inc has resolved a bitter trademark dispute with The Beatles' guardian Apple Corps Ltd over use of the iconic apple logo and name.

But while the truce announced on Monday appeared to finally bury the long-simmering animosity, music lovers will still need to wait for the right to buy such songs as Hey Jude on Apple Inc's iTunes online store.

The announcement -- made jointly by one of the world's largest music sellers and one of history's most beloved bands -- was silent on whether the catalog of Beatles songs will become available for download any time soon.

The Beatles have so far been the most prominent holdout from iTunes and other online music services, and Apple's overtures to put the music online have been stymied by the ongoing litigation.

The settlement gives Cupertino-based Apple Inc ownership of the name and logo in return for agreeing to license some of those trademarks back to London-based Apple Corps -- guardian of The Beatles' commercial interests -- for their continued use.

It ends the ongoing trademark lawsuit between the two companies, with each side paying its own legal costs. Other terms of the settlement were not disclosed.

Industry analysts said a resolution on putting The Beatles' music online is likely already in the works.

"It goes from impossible to a lock that it's going to happen -- it's a function of time at this point," said Gene Munster, senior research analyst with investment bank Piper Jaffray & Co. "I bet they move pretty fast. For Apple, it was critical that they got this taken care of."

Jaffray estimates that Apple Inc paid The Beatles US$50 million to US$100 million for the rights to the Apple name. That would come on top of more than US$26.5 million Apple paid to settle past disputes with Apple Corps.

It's no secret that Steve Jobs -- Apple Inc's chief executive officer and a huge Beatles fan -- has wanted the British band's music on iTunes, which has sold more than 2 billion songs worldwide and has catapulted Apple into the top ranks of music sellers.

However, decades of legal disputes between the two companies have thus far made any partnership all but impossible.

"We love the Beatles, and it has been painful being at odds with them over these trademarks," Jobs said in a statement. "It feels great to resolve this in a positive manner, and in a way that should remove the potential of further disagreements in the future."

The Beatles had been one of the few remaining big-name musical acts to reject any legal distribution of its work on the Internet.

Artists have complained that online distribution leaves them with too small a profit and that iTunes wrecks the artistic integrity of an album by allowing songs to be purchased for US$0.99 apiece. Bands such as AC/DC have sold albums only at other, more flexible sites.

Elizabeth Freund, the US spokeswoman for Apple Corps, said EMI would first need an agreement with Apple Corps before licensing any music to Apple Inc or other online services. She said there is no such deal yet.

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