The Beatles Finally Agree To Deal With Apple

The Beatles and Apple have been negotiating and settling disputessince the late 1970’s, first with trademark dispute of the name Apple Corps, owned by the Beatles, then over what was known as Apple’s Music Synthesizer, and now over licensing and digitally distributing the recorded catalogue of the group’s music. Ironically, after a total of thirty two years of bickering back and forth, both parties are ready to play nice and do business so many generations of new Beatles fans, as well as the old, will have a more accessible channel through which to purchase their favorite selections.

The primary parties in this negotiation are Apple, Inc. and the entire Beatles group. The secondary party in the group that has stake in the negotiations is the record company EMI whom owns a considerable portion, alongside of Michael Jackson’s estate, of the Beatles master recording rights. Though all three sides had a very large monetary incentive that would encourage them to make the deal, one of the strongest inhibitors to the agreement was based around the ability to satisfy each separate member of the Beatles interest(s) in the agreement before anything could move forward in the total process, which took roughly seven years. Obviously, a super group, such as the Beatles, doesn’t really have to worry so much about the financial end of what their return will be in this type of negotiated deal, their main focus will be on what is know as Marketing Reach, and how this type of business merger will benefit the longevity of their entire catalog of music. The main questions that will likely be asked on the management end of the band’s side are: “Will this venture be profitable and reach new fans?” “Will this agreement help facilitate new business and future sales of the Beatles music?” and lastly, “Is releasing this music through iTunes a valid effort to modernize with the distribution process as the methods of selling recorded music evolves and changes?” From the iTunes side, they already own 90% of the digital distribution market and don’t particularly need the Beatles to help their quarterly reports. Their interest in this would be to protect their already existing market share and look toward future growth if they have the monopoly on digitally distributing the Beatles music. EMI, on the other hand, was almost in bankruptcy and needed this deal to happen more than anyone; their stake in the agreement could potentially save the entire record label.

During this long negotiation process many different angles were used to understand each reason this deal had to happen for everyone involved. One of the most present elements was the Beatles management’s ability to “separate the people from the problem” and “focus on the mutual benefit”. Even though it was apparent that each side had the ability to utilize the best alternative to the entire negotiation and continue on with their daily process, it was made very clear each party involved was for making a solid, long-term agreement.

The Beatles separated the people from the problem by hiring Jeff Jones to run their company’s interests and Mr. Jones was new enough to their business to have not developed any animosity toward Apple and want to look at the best options for protecting and preserving the group’s interest in their own music; he felt digital distribution was something that had to happen in order for this to long-term solution to be successful. Focusing on the mutual benefit aspects of the deal gave each party the ability to come to the table with something to gain and an even better incentive to make fair offers to speed the process along. In this mind-set and avoiding the pitfalls of Distributive Thinking, they were able to expand the entire pie to include a fair profit portion for all three entities involved. The benefits of this, other than financial, include: publicity and promotional power, two of the most important words for any business’s brand.

Though there were many different positive and negative factors represented by each side, one major aspect of the negotiation went very well. Apple was able to offer the Beatles their absolute highest payout for their purchases while not offending the other super groups already being distributed through iTunes, including: Garth Brooks, AC/DC, and Kid Rock. This was very important to Apple because they didn’t want to put themselves in the position to offer the Beatles more, just to make the agreement and have other groups assume they could hold out and get the same amount.  One could assume that this was an aspect of the deal that adversely didn’t go well for the Beatles because of the length of time they felt they needed to hold out, but the hold out in itself is more than likely the largest aspect of the agreement that had a negative affect on the process. Having to appease the estates and family members of a multi-billion dollar group was something that didn’t have to take as long as it did and therefore could have put the entire contract in jeopardy.

After much hard work, negotiating, and deal making, there was a mutually beneficial agreement reached that could foster a long-termmutually beneficial relationship, a relationship that is considered by many to be one of the most solid in the record industry. Though the Beatles will receive a reported $1.29 per song, when most digital albums are only $12.99, the Digital Beatles box set is a great barging to their fan-base at a mere $149.00. This is an absolutely amazing price for the most die-hard Beatles fan that legally wants to obtain a high quality digital copy of the group’s music. Now, with the ability for millions of existing fans, as well as new younger generations of fans, the Beatles have the ability to once again grow and root themselves into what can be considered as an even bigger part of rock and roll infamy, even in the new digital revolution.