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Beatles' Deal Most Lucrative in iTunes History

Groundbreaking contract could set precedent for other big-name bands

January 6, 2011 9:40 AM ET
Beatles' Deal Most Lucrative in iTunes History

The deal that brought the Beatles' discography to the iTunes store may be one of the most lucrative and groundbreaking contracts in the history of digital music, according to Reuters.

Industry sources say iTunes is paying royalties directly to the band's company, Apple Corps, and Sony/ATV Music Publishing, who control the majority of the band's catalog.

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This direct payment of royalties differs from a standard contract in which record labels license songs from music publishers, collect wholesale revenue from retailers and distribute royalties to the artist and publisher. If the details of this Beatles/iTunes deal are true, it means that the band are essentially licensing the master recordings to the store and cutting out several middlemen.

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EMI Music, who would distribute the royalties under a normal deal, have declined to comment on the matter. Nevertheless, if news of the deal is accurate, it could set a precedent for similarly lucrative deals down the line for other artists with major sales clout.

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Other musicians, such as Cheap Trick, the Allman Brothers Band and AC/DC, have unsuccessfully attempted to negotiate deals in which they would be allowed to control their master recordings and devise their own licensing deals. Though the Beatles' apparent success in this deal is likely to inspire other huge acts to seek similar contracts, it could be that only the Fab Four have the leverage to pull it off.

Beatles being paid directly by iTunes in deal [Reuters]

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