Beatles catalog may be headed for digital distribution

CNET News.com

Talks have begun that could finally make the songs of The Beatles available for sale online, sources familiar with the situation said.

Representatives for The Beatles have spoken with numerous online music providers, ranging from small companies to Microsoft, which is planning to open an Internet music store this year. The Beatles' side is asking for a considerable sum in return for providing exclusive online distribution rights, perhaps for as long as a year or more.

"They are looking for someone to come up with the ideal way to put The Beatles online," one digital music executive told CNET News.com.

That interest could lead to a milestone in the short history of digital music. Online music services are struggling to prove they can offer more music than a brick-and-mortar store, and the lack of songs by rock and roll's premier group has been an oft-cited gap in their appeal.

The Beatles broke up more than three decades ago, but their music continues to sell in high volumes.

"One of the things that has held back digital music online has been lack of availability of very popular artists, notably among them The Beatles," said Jupiter Research analyst Michael Gartenberg. "If they are able to come to some sort of licensing terms, it bodes very well for the online model and would probably pave the way for some of the other holdouts to come online."

But it may be some time before "Sgt. Pepper's Lonely Hearts Club Band" and "Let it Be" are sold on Apple Computer's iTunes or on Napster. One idea being considered is a Beatles-branded store that would be the only place online where the group's music, videos and other multimedia products would be sold, sources said. The store could be operated by one of the existing online music services.