The big changes are underway for the iPod after the agreement with the Beatles: the iPod is about to become the new CD.
On Monday, Apple Inc. and the Beatles’ Apple Corps announced that a 15-year legal dispute over the “Apple” trademark had been resolved in favor of Steve Jobs.
But the biggest news wasn’t mentioned at all in the joint press release: The new deal paves the way for Jobs to sell iPods loaded with music.
Who cares?
Well, the iPod could become the new CD, especially if Apple starts offering cheap iPod shuffles preloaded with new albums or artist catalogs. Imagine a whole range of cheap special edition iPods branded after popular bands and containing a new album or their entire catalogues.
Flash drives are now so cheap that software companies are starting to use them to distribute software. H&R Block, for example, is selling the latest version of its tax preparation software on a flash drive for $40, the same price as the CD version. How much would it cost Apple to add some music chips and some cheap headphones?
Until now, Apple couldn’t do this because of the 15-year contract between Apple Corps, the Beatles’ music company, and Apple Computer. This contract prevented Jobs’ Apple from acting as a music company and selling CDs or “physical media that deliver pre-recorded content… (such as a compact disc of Rolling Stones music).”
Apple has been selling music for downloads for years, of course, but thanks to this clause, the company couldn’t sell an iPod with music already loaded.
That’s why U2’s special edition iPod comes with a coupon to download the band’s catalog online. The Beatles’ contract prevents Apple from preloading the U2 iPod with U2 music.
Without a doubt that is going to change. Apple will soon offer a range of iPods preloaded with songs.
The first to arrive will likely be the widely rumored Beatles special edition Yellow Submarine iPod, launching in just over a week on Valentine’s Day.
Beatles fans are hoping that the Fab Four’s entire catalogue, currently being remastered, will be available in uncompressed format. What better way to deliver it than preloaded on an iPod, rather than forcing fans to download gigabytes of data from iTunes?
