Apple Corps and the Beatles

By early 1967, PaulMcCartney was actively campaigning for the establishment of a Beatles-owned company, tentatively named Apple, to run in coordination with Brian Epstein’s management company, NEMS Enterprises. As John would later clarify, “Our accountant came up and said ‘We got this amount of money. Do you want to give it to the government or do something with it?’” Thus while ostensibly founded to promote new artistic talent (the Beatles were constantly being approached to promote new artists or invest in new projects), such a business entity was largely needed to protect the Beatles’ finances. (Even by 1963 the Beatles were bringing in such unheard-of income that manager Brian Epstein had began utilizing various tax shelters.) And even though Epstein did his best to warn the boys of the potential pitfalls of their plan—stressing that business decisions are best left to business experts—Paul insisted the plan move forward. Only John, apparently, had serious misgivings.   

With legal and business guidance from Brian Epstein’s attorney and accountant, Alan Davis and Harry Pinsker, the first step towards creating this new business were put into motion, a partnership called Beatles and Co. (established in April of 1967). Under this new business structure, each Beatle would own 5% of Beatles and Co., with a new collectively-owned corporation (soon known as Apple) controlling the remaining 80% . All profits above individual songwriting royalties would go directly into Beatles and Co. coffers–and taxed at a far lower corporate tax rate.   

Registering Apple Music Limited on May 25, 1967, Brian and his brother Clive (a partner in NEM management) were listed as directors, with John and Paul reportedly each holding 24 shares, George and Ringo, 25 each. But although the Beatles had by this point resigned themselves to taking some level of control of their own business affairs (and finances), when Brian tragically died just three months after Apple’s foundation (on August 27, 1967), their casual involvement suddenly accelerated–their vision quickly threatening to spiral out of control. (And with Brian no longer in the picture, brother Clive flatly wanted nothing to do with the venture.) So in an effort to establish stability and assert business autonomy, on December 4, 1967 the Beatles essentially took step back, forming The Beatles Ltd.   

In January of 1968, Beatles Ltd. officially became Apple Corps Ltd., with the Apple trademark registered in 47 countries. This was followed in February by registration of Apple Electronics, Apple Films Ltd., Apple Management, Apple Music Publishing, Apple Overseas, Apple Publicity, Apple Records, and Apple Retail. (Though originally designated an outlet for the Beatles and their growing roster of talent including Mary Hopkin, James Taylor, Badfinger, and Billy Preston, by the mid-1970s, Apple Records was dominated by the individual Beatles’ solo projects.) And almost from the onset, it was clear that Paul and John had two quite-different visions for their Beatles-owned business: Paul quoted as saying it would be, “A beautiful place where you can buy beautiful things . . . a controlled weirdness . . . a kind of Western communism,” while John described it as, “A company we’re setting up, involving records, films, and electronics and . . . a system where people who just want to make a film about anything, don’t have to go on their knees in somebody’s office . . . .”   

Though conceptually envisioned as a relatively small operation, without proper oversight, Apple quickly grew monstrous in size, with suites of over-staffed luxury offices filled with personnel (largely friends and relatives) burning through money faster than it was coming in. In an interview in January of 1969 John lamented that Apple was costing the Beatles $50,000 a week: “It doesn’t have to make a profit, but if it carries on like this all of us will be broke within six months.” In an effort to restore order, on May 8, 1969, John, George, and Ringo signed with business manager Allen Klein—directly opposing Paul’s choice of Lee Eastman (his father-in-law). When Paul chose to sign with Eastman, John and Paul’s long-brewing differences quickly boiled over—becoming fodder for the Press—causing the Beatles to quickly disintegrate as a band. Announcing his formal resignation from the Beatles on April 10, 1970 (John already deeply involved in his own projects), on March 12, 1971 Paul launched a dissolution court action resulting in the band’s business affairs being placed in court-ordered receivership—effectively ending the four Beatles’ direct interaction with the company they founded together.   

In 2010, Apple Corps was ranked #2 on Fast Company magazine’s list of the world’s most innovative companies in the music industry, this largely due to the release of The BeatlesRock Band video game and the remastering/reissuing of the Beatles’ entire music catalog.