Apple Beats the Beatles

Yesterday, all The Beatles' digital troubles seemed so far away. But now, if a London judge has his way, they'll be here to stay. Don't expect the band's label, Apple Corps., to hide away. The fight with Apple Computer (Nasdaq: AAPL  ) is just beginning, executives say.

The brouhaha over whether Apple Computer gets to use its logo in promoting the iTunes Music Store took a decidedly positive turn for Steve Jobs' camp yesterday, when a London high court ruled that the Mac maker's marketing doesn't violate a 1991 settlement with Apple Corps.

That deal came a decade before the digital revolution that would produce iTunes and the iPod. I've written before that the suit could be more about Apple Corps. figuring a way to sell its Beatles library online, which would seemingly violate its non-compete clause with Apple Computer. Call it the Abbey Road version of a preemptive strike?

But I'm not writing today to expand on that thesis. Instead, I'm interested in what this all means for the Mac maker. As far as I can see, Cupertino has suddenly overtaken Motown and London's entertainment-inclined West End. If the Beatles can't find a judge willing to overturn the high court, the group's digital distribution plans will likely require a team-up with Apple -- unless a rival ponies up a huge sum.

Microsoft (Nasdaq: MSFT  ) would certainly be interested, as would smaller competitors such as RealNetworks (Nasdaq: RNWK  ) and Napster (Nasdaq: NAPS  ) . But none of these three have the same cachet in music as iTunes. And even if one managed to win over the surviving members of the Fab Four, the majority of downloads would most certainly make their way onto millions of iPods. Either way, Apple wins.

It would also be the latest in a long string of digital-entertainment victories for the Mac maker. For example, Apple Computer won a tussle with a number of record labels over the pricing of digital tunes. These victories suggest that Apple is now firmly in the catbird seat when it comes to vying for your online content dollar.

Investors need to know if that position is sustainable, and if it's worth Apple's $60 billion market-cap price tag. What's your take? I'll publish the best responses in a follow-up commentary a week from today.

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Fool contributorTim Beyerswonders when Apple and The Beatles will finally make nice and begin working together. Tim didn't own share in any of the companies mentioned in this story at the time of publication. You can find out which stocks he owns by checking Tim's Foolprofile. Microsoft is aMotley Fool Inside Valuepick. The Motley Fool has an ironcladdisclosure policy.


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