An unofficial history of the Beatles' Apple
1967 - The Nems years
Life in post-war England was relatively simple
back in 1962. For aspiring professional entertainers like
The Beatles - a four-man rock and roll band from Liverpool
- a career in music promised little more than weekly engagements
at local dances and youth clubs, and if they were lucky,
perhaps a chance to cut a record that might get one or two
spins on Radio Luxembourg or the BBC. Of course, fate held
something quite different in store for The Beatles. Six
months after their debut single Love Me Do became a minor
hit, The Beatles sparked off a tidal wave of fan hysteria
the intensity of which had never before been seen in popular
music. During the halcyon days of 1963 and 1964, Beatlemania
swept unchecked across the world. Show business, popular
music and the world itself were changed forever.
Guiding The Beatles throughout the turbulent
Beatlemania era was their manager, Brian Epstein. From 1962
to 1967, The Beatles were managed exclusively by Epstein
and his artist management firm, Nems Ltd - an organization
that Epstein himself had set up shortly after meeting The
Beatles in 1962. Coming from an affluent Liverpool family,
the mild-mannered Epstein was quite unlike the typical "pop"
managers of the era. Prior to becoming the group's manager,
Epstein's music industry experience had been limited to
running the record department of his parents' Liverpool
department store. But given that he was one of the few people
in Liverpool to have actually conducted business with the
London-based record companies, Epstein's decision to venture
into artist management was not as far-fetched as it might
have seemed at the outset. The Beatles were certainly impressed
with Epstein's modest music industry connections and with
his genuine enthusiasm for the band, so they signed a five-year
management contract with him in January 1962. From that
point onwards, all of the money generated by The Beatles
was funnelled directly through Nems. In exchange, the four
Beatles were each given a salary and had their living expenses
paid by the company.
Initially, Epstein's management duties focused
on securing a record contract for the group, polishing their
professional presentation and overseeing the group's live
bookings. But once the full force of Beatlemania took hold
in 1963, The Beatles became increasingly reliant on Epstein
and Nems to take care of almost every aspect of their personal
and professional lives.
Receiving a 25% share of The Beatles' gross
income, Epstein was certainly very well compensated for
his efforts. But Epstein served the band with a remarkable
sense of care and devotion and it was obvious that he regarded
The Beatles as much more than just a once-in-a-lifetime
business opportunity. In the early days of Beatlemania,
Epstein's name was synonymous with The Beatles. Due in large
part to the remarkable success of the group, Epstein was
able to build Nems into a high-powered management company
that would become the dominant force behind the Liverpool
Having seen what Epstein had done for The Beatles,
almost all of the performers in Liverpool rushed to align
themselves with Nems. From 1963 onwards, Nems Enterprises
managed the careers of artists such as Cilla Black, Gerry
and The Pacemakers, The Fourmost and Billy J. Kramer, as
well as several lesser-known Liverpool groups.
Under Epstein's skilful direction, Nems developed
a diverse and initially highly successful client roster,
but it was clear to all of the other Nems artists that The
Beatles were Epstein's one true passion. Whether charged
with finding a house for one of The Beatles, negotiating
television appearances or quietly settling such personal
matters as threatened paternity suits, Epstein handled his
duties in an efficient, dignified manner and all four Beatles
considered him to be not only a manager, but a friend. When
it came to The Beatles, no matter was too trivial to be
given Epstein's full attention.
In retrospect, Epstein's only real professional
shortcoming was his marked lack of business acumen. Still,
while much of The Beatles' success can, and should, be attributed
to their immense talent, it was Epstein's music industry
contacts and his careful handling of the group's image and
presentation that transformed The Beatles from a rough,
leather-clad rock and roll band from "up North" into a polished,
international show business phenomenon.
Today, Epstein's significant contributions to
launching The Beatles' career are often overshadowed by
the embarrassingly poor business deals that he negotiated
on behalf of the group. The original recording agreement
Epstein signed with EMI in 1962 was a one-year contract
that gave EMI the option of extending The Beatles' contract
for three successive years. In return, the band would get
one penny of recording royalties for each single sold and
precious little more for each album sold in the UK. For
any Beatles recordings licensed to record companies outside
of the UK, the group would receive only half of the UK royalty
rate. Epstein would somewhat rectify matters when it was
time to renegotiate The Beatles' EMI contract in January
1967. In exchange for re-signing to EMI until 1976, The
Beatles would receive 10% of the wholesale price of a British
album and 17.5% of the wholesale price of each album sold
In Epstein's defence, the deals he negotiated
for the group were fairly common by music industry standards
in 1962. He would fare far worse with the non-music deals
that he set up for the group. Epstein's most celebrated
fiasco was the 10% royalty rate he negotiated for the American
rights to manufacture and sell such seemingly trivial Beatles
merchandise as wigs, shampoo, trading cards and the countless
other items that flooded into American discount stores during
1964 and 1965. When Epstein entered into these deals in
1964, the 30 year-old ex-furniture and record salesman from
Liverpool was no match for the quick-talking New York City
businessmen who appeared to be offering him thousands of
dollars in exchange for the simple use of The Beatles' name
on what he perceived to be insignificant teen-oriented products.
Due to the limited scope of his business experience, Epstein
practically gave away the rights to The Beatles' American
merchandising - a move that would ultimately cost The Beatles
millions of dollars of revenue.
To be fair to Epstein, few music industry professionals
at that time - let alone a music industry novice like Epstein
- ever imagined just how much money music merchandising
could generate. To Epstein, any revenue from the sale of
such ancillary "Beatles products" was just "found money"
to supplement The Beatles' live and recording income.
Never considered to be a great negotiator, Epstein's
true strengths were his well-developed organizational abilities,
his unflinching honesty and his conservative, reliable stewardship
of The Beatles' finances. With Epstein overseeing the group's
affairs, the four Beatles enjoyed a relatively carefree
existence when it came to financial matters. If they wanted
any item - be it a car, a house, or new clothes - they simply
charged it to Nems and the bill would be paid with no questions
asked. With Nems so thoroughly involved with managing their
finances, the four Beatles made very few personal investments
during the peak years of Beatlemania. The investment activities
of the individual Beatles were limited to Ringo Starr's
interest in a high-end construction company and Paul McCartney's
decision (unbeknownst to the other three Beatles) to buy
additional shares in Northern Songs, the music publishing
company that held the rights to The Beatles' songs. In general,
The Beatles seemed content to simply let Nems take care
In addition to the money earned from live performances
and record and music publishing royalties, The Beatles had
several other sources of revenue prior to 1967. Their most
significant collective investment was Subafilms, the Nems-run
film company that controlled the group's share of The Beatles'
film projects, responsible for producing Beatles promotional
films (in the days before video) for television.
As well as owning Subafilms, all four Beatles
held shares in Northern Songs Music Publishing, the company
that held the publishing rights to The Beatles' songs. Although
Northern Songs founder Dick James retained a majority interest
in the company, The Beatles and Nems each held significant
portions of Northern Songs. In addition to their Northern
Songs stock, Lennon and McCartney were also co-owners of
a company formed on 4 February 1965 named Maclen Music Ltd.
Theoretically, Maclen licensed the rights to publish Lennon
and McCartney songs to Dick James' Northern Songs with Maclen
collecting 50% of the publishing royalties due to Lennon
and McCartney from Northern Songs. The remaining 50% of
the publishing revenue went to Northern Songs.
Dick James had been unusually fair to The Beatles
(by industry standards of the day) when he set up Northern
Songs in February 1963. Recommended to Brian Epstein by
Beatles producer George Martin, James had a tremendous amount
of respect for The Beatles and their music. Though The Beatles
were little more than a talented group with one minor hit
(Love Me Do) to their credit when James first met them in
early 1963, James, a failed pop singer and then struggling
music publisher, knew that the songs of Lennon and McCartney
had the potential to become major hits.
In exchange for the publishing rights to The
Beatles' second single, Please Please Me, James used his
music industry connections to secure The Beatles a coveted
spot on the BBC television programme Thank Your Lucky Stars.
Impressed by his ability to get The Beatles on television,
Epstein decided that The Beatles would sign with Dick James
In a highly unusual move in an era in which
songwriters would often sign away their songwriting royalties
for an advance of twenty pounds or less, James set up a
subsidiary company, Northern Songs, for the sole purpose
of publishing the songs of Lennon and McCartney. As part
of the deal James offered the group, the two songwriting
Beatles and Nems were given shares in Northern Songs that
represented almost 50% of the company's worth. By 1967,
Northern Songs had been re-structured and had gone public,
so in addition to having received significant cash payments
between 1964 and 1966 for a portion of their equity in the
company, Lennon and McCartney each still owned roughly 15%
of Northern Songs' stock. George Harrison and Ringo Starr
owned 1.6 % of Northern Songs stock between them.
But outside of investments like Subafilms and
Northern Songs, all four Beatles seemed to be perfectly
willing to let their royalties pile up in their Nems account
and draw a weekly wage. It would not be until the mid-sixties
that The Beatles, George Harrison and Paul McCartney in
particular, began taking an increased interest in the group's
In the innocent era during which The Beatles
had emerged, it was generally accepted that artists were
responsible for creating the music and that professional
managers took care of business. Out of all of the English
groups who sold millions of records during the "British
Invasion" only Dave Clark of the Dave Clark Five had the
foresight, and skill, to take full control of his group's
business affairs. (In addition to negotiating a royalty
rate with EMI that far exceeded that of The Beatles, Clark
retained the rights to all of his band's master tapes and
music publishing. He would also later buy the rights to
the celebrated British pop music television show Ready Steady
Go, giving him exclusive rights to live TV performances
by The Beatles and almost every other top band of the mid-sixties.)
Even when Harrison and McCartney started to
take a greater interest in the group's financial affairs,
there was actually very little that one or even two Beatles
could do to influence matters. Since the earliest days of
the group, the band made all of their decisions by consensus.
Given the success of this democratic system, each of the
four Beatles were somewhat reticent to appear too domineering
in the eyes of the others. In the interest of preserving
harmony within the group, it was often simply easier to
let Epstein or another outsider take care of business matters.
Compared to many of their contemporaries, The
Beatles were unusually democratic for a pop group. The way
they conducted their business was largely governed by the
strong personal ties between the four members of the band.
Having been bound together through the non-stop recording
and touring schedule that they maintained for close to five
years, by 1967 The Beatles enjoyed a near family-like relationship
and were quite accustomed to doing almost everything together.
Each Beatle explored individual pursuits after
the group ceased touring in 1966. These included such non-Beatles
projects as John Lennon's acting role in the film How I
Won The War and Paul McCartney composing the music for the
film The Family Way. However, these projects were not regarded
as serious efforts to establish careers outside of the group
and none of the side projects seemed to detract from the
band's intense camaraderie. When the group settled back
into Abbey Road Studios in late 1966 to begin work on "Sgt.
Pepper" they were still an incredibly tight-knit unit. In
early 1967, the group even looked into buying a Greek island
where they could live and work together. They went as far
as to visit Greece and select a remote Greek island to purchase
before they characteristically lost interest and dropped
the whole project.
Curiously, while each Beatle had at one time
or another stated that The Beatles as a group would not
go on for ever, none of them appeared to envisage the possibility
that there could ever come a time when they would no longer
be on speaking terms. It was in this spirit that they entered
into their next venture, the jointly owned business that
would become Apple.
In late 1966, The Beatles and their financial
advisors had started to explore options for setting up a
new Beatles corporation that would consolidate the groups'
business affairs and enable them to lessen the impact of
the notoriously harsh tax system that existed in Britain
at that time. (When Apple was formed, the group's income
was being taxed at a rate of around 90%.) Additionally,
the band had been informed by its tax advisors that they
would have to collectively pay three million pounds in tax
unless they offset their tax liability by investing in a
business. It is important to note that Apple was not set
up to replace Epstein and Nems. It was created as a tax
shelter to complement, rather than replace, the existing
The first step towards creating this new business
structure was to form a new partnership called Beatles and
Co. in April 1967. To all intents and purposes, Beatles
and Co. was an updated version of The Beatles' original
partnership, Beatles Ltd. Under the new arrangement, however,
each Beatle would own 5% of Beatles and Co. and a new corporation
owned collectively by the four Beatles (which would soon
be known as Apple) would be given control of the remaining
80% of Beatles and Co. With the exception of individual
songwriting royalties, which would still be paid directly
to the writer or writers of a particular song, all of the
money earned by The Beatles as a group would go directly
to Beatles and Co. and would thus be taxed at a far lower
corporate tax rate.
The Beatles appeared to be so anxious to begin
reaping the tax rewards offered by this plan that they entered
into their new partnership agreement having given little
thought to the possible future implications of their actions.
John Lennon - who was taking copious amounts of LSD throughout
the period that Apple was being set up - would later claim
that he was so high during this time of his life that he
didn't remember signing any new partnership agreement at
Peter Brown, a fellow Liverpudlian who had worked
for The Beatles and Nems since 1962, explains the origins
of Apple: "When Apple was formed, which was before Brian
died... it wasn't called Apple, but the structure of the
buyout was there. The reason The Beatles sold 80% of themselves
to this entity, which would become Apple, and to change
Beatles Ltd. to Beatles and Co. was to save taxes. The reason
that the 80% sale was triggered was because of the accumulated
royalties at EMI that they were due to receive and the fact
that if the royalties had been paid to them as individuals,
it would have been taxed at 85% or something like that.
So this structure was set up by Clive Epstein [Brian Epstein's
brother] as a tax structure. At one point it was suggested
that this be a real estate company: that was the original
idea for lack of anything else. They couldn't figure out
what to do with all this capital. All of this was set up
while Brian was alive. After Brian died, my recollection
is that they then decided to take this entity and create
what they did, which was Apple."
It was hardly coincidental that the formation
of Apple coincided with a period of marked turmoil within
the Nems organization. Due in part to Epstein's personal
problems that sprung from his increasingly complex gay lifestyle
and escalating drug use, there were times when Epstein seemed
to be losing control of Nems. To Epstein's dismay, by 1967
The Beatles had also become aware of how Nems' handling
of the band's American merchandising had cost the group
millions of dollars of income. The Beatles also resented
the fact that many lesser groups had secured far more lucrative
record contracts than Epstein had secured for The Beatles.
Yet despite their displeasure with the deals
that Epstein had negotiated and the deteriorating situation
at Nems, The Beatles never publicly announced any intention
to leave Epstein when his management contract expired in
August 1967. None of the band's associates from that time
believe that they would have ever left Epstein and Nems.
Rather than take out their financial frustrations directly
on Epstein, the group seemed to simply want to preserve
the considerable sums of money that they were earning.
The new corporation would be the first step
in preserving some of their hard-earned income. By mid-1967,
The Beatles had established a basic corporate structure
and now needed to find a business in which to invest their
capital if they were going to receive any tax benefit. Given
that they were among the best-known, most-respected young
multi-millionaires in the world, The Beatles felt the need
to invest in a business that would simultaneously complement
their image and provide a good measure of financial security.
Given such an ambiguous mandate, The Beatles
were decidedly unsure about what form Apple should take.
By mid-year, Apple had evolved into little more than a handful
of sketchy ideas and what was essentially a holding company
for The Beatles partnership. But as 1967 wore on and The
Beatles moved into one of the most adventurous stages of
their development (both personally and musically) the group
began to envisage Apple as becoming something much more
ambitious than a simple tax shelter.
A good deal of the energy and enthusiasm that
fuelled Apple's early development was drawn directly from
the flowering youth culture and the exciting art and music
scenes that had enveloped London towards the end of 1966.
By the summer of 1967 - the much heralded "Summer of Love"
- London (along with San Francisco) found itself at the
epicentre of a burgeoning youth movement.
As the warm summer weather and increasingly
carefree social climate infused the youth of Britain with
a wonderful sense of energy and optimism, the BBC and pirate
radio stations made sure that the entire nation was awash
with the remarkable sounds of The Beatles' "Sgt. Pepper"
album and of new records by such colourfully named groups
as The Pink Floyd and The Jimi Hendrix Experience. The Beatles
were quite taken with swinging London and it was not unusual
to find one or more Beatles checking out "happenings" or
performances by one of the many new bands.
It was not only music that was capturing the
imagination of England's youth and the interest of the world's
media. In almost every corner of London, new boutiques,
art galleries and specialist bookshops were springing up
and the best and the brightest young minds in England were
attempting to reshape a few select London neighbourhoods
in their own image. Comprising the first generation of English
youth who were too young to feel the full impact of the
Second World War, these fashionable teenagers and twenty-somethings
felt free to pursue their interest in music, art and leisure
and they did so with great zest. The introduction of drugs
to the scene only served to bolster the generally giddy
spirit of the time.
Poised at the absolute centre of all this activity
was Paul McCartney. With his upmarket St. Johns Wood home
in London, a beautiful sophisticated actress girlfriend,
stylish clothes and immense musical talent, McCartney was
among the best-known exponents of swinging London.
While the other three Beatles languished in
the outskirts of London with their wives and young children,
McCartney would attend beat poetry readings, check out the
new bands, go to the theatre, listen to avant-garde composers
such as Karl Stockhausen and even make experimental films.
McCartney was fully consumed by the wave of creativity that
had swept over London and he genuinely felt that The Beatles
could - and should - use their wealth and influence to help
nurture this exciting new scene.
One of the early ideas for The Beatles' new
corporation was to set up a chain of record shops across
England, the idea being that The Beatles would be able to
amass sizeable property holdings under the pretext of purchasing
shop space. It was an interesting idea, but it never got
beyond the initial planning stages. With little progress
having been made on establishing some sort of property-driven
company, The Beatles - at the urging of Paul McCartney -
decided that their first commercial venture would be a music
Given the low start-up costs and The Beatles'
collective expertise in songwriting, establishing a music
publishing company was certainly a logical option to pursue.
As the driving force behind the formation of a "Beatles
company" it was McCartney who finally came up with an ideal
name for the company - "Apple". As long-serving Apple Managing
Director Neil Aspinall recalled in an Apple press handout:
"Paul came up with the idea of calling it Apple, which he
got from René Magritte. I don't know if he was a Belgian
or Dutch artist... he drew a lot of green apples or painted
a lot of green apples [the painting in question was Magritte's
Le Jeu de Mourre]. I know Paul bought some of his paintings
in 1966 or early 1967. I think that's where Paul got the
idea for the name from." Even though it was initially not
clear what form Apple would ultimately take, when the "Sgt.
Pepper" album was released in June 1967, The Beatles had
already mysteriously thanked "The Apple" on the back cover
of the album.
Whatever tentative plans The Beatles may have
had for Apple that summer, however, were certainly altered
when Brian Epstein was found dead in his London home on
Sunday 27 August 1967. Only 32 years old at the time of
his death, Epstein had apparently accidentally overdosed
on prescription sleeping pills. The Beatles, who were all
in Bangor, Wales attending a lecture on transcendental meditation,
were naturally devastated by the news. When reached in Bangor,
The Beatles appeared before the news cameras to offer a
statement, looking shocked and confused. John Lennon would
later admit that it was at that moment that he first felt
that The Beatles were finished.
Epstein's death was a pivotal event in the development
of Apple. Despite The Beatles' loyalty to Nems and the Epstein
family, now that Brian Epstein was no longer running the
company, it was soon apparent that The Beatles' relationship
with Nems would change. In the weeks following Epstein's
death, The Beatles appeared willing to remain with Nems,
yet they also indicated that they were now looking to gain
more direct control of their personal business.
One of the most contentious issues between The
Beatles and Nems after Epstein died arose when they learned
that a brash Australian named Robert Stigwood was angling
to take control of Nems. It later transpired that Epstein
- unbeknownst to The Beatles - had indeed made plans to
sell Nems to Stigwood. Prior to Epstein's death, The Beatles
had assumed that Stigwood was simply another Nems employee
and they were most annoyed that Stigwood felt that he could
simply pick up where Epstein left off as manager of The
Epstein had made Stigwood co-managing director
of Nems in January 1967, allegedly with the intention of
later starting a new management company for The Beatles
and Cilla Black, and then selling the remaining Nems assets
to Stigwood. However, within months of Stigwood joining
Nems, considerable tension had developed between Epstein
and Stigwood. Although Stigwood was responsible for bringing
the Bee Gees and Cream to Nems, Epstein and Stigwood apparently
had very different opinions as to how Nems should be run.
Epstein was reportedly very concerned by Stigwood's excessive
spending and by the summer of 1967 he was said to be trying
to find a way to ease Stigwood out of Nems.
The problem was that Epstein had extended an
offer to Stigwood and Stigwood's business partner, David
Shaw, which would allow them to purchase a controlling interest
in Nems for £500,000. The standing offer was valid until
September 1967, and when Epstein unexpectedly died in August,
Stigwood and Shaw announced their intention to exercise
their option. Stigwood's plans for acquiring Nems were thwarted
only after The Beatles, who had previously been unaware
of Epstein's plan to sell Nems to Stigwood, informed Stigwood
that there was absolutely no way that they would accept
him as their manager.
Stigwood, who had little interest in Nems if
it did not include The Beatles, abandoned his plans to purchase
the company. Instead, he left Nems altogether, taking with
him the Bee Gees and Cream and starting his own company,
With Stigwood out of the picture, Brian Epstein's
younger brother Clive assumed control of Nems. For several
months after Epstein died, The Beatles' relationship with
Nems changed very little. Despite Brian Epstein's death,
Nems would continue to oversee The Beatles' day-to-day affairs.
In fact, it seems that The Beatles even contemplated taking
a more active role in Nems and using the company as an outlet
for discovering and nurturing new artists, which is exactly
what they eventually did with Apple.
Ringo Starr admitted in a 1970 interview with
"We tried to form Apple with Clive Epstein but he wouldn't
have it... he didn't believe in us I suppose... he didn't
think we could do it. He thought we were four wild men and
we were going to spend all his money and make him broke.
But that was the original idea of Apple - to form it with
Nems... we thought now Brian's gone, let's really amalgamate
and get this thing going, let's make records and get people
on our label and things like that. So we formed Apple and
they formed Nems, which is doing exactly the same thing
as we [Apple] are doing. It was a family tie and we thought
it would be a good idea to keep it in, and then we saw how
the land lay and we tried to get out."
Peter Brown, the Nems employee who inherited
the lion's share of the responsibility for looking after
The Beatles after Epstein's death, does not think that the
idea of The Beatles using Nems to discover and develop talent
was a likely proposition. "I don't remember that and I'm
sure that if that was so I would remember because there
wouldn't have been anything like that being discussed without
me knowing," recalls Brown, adding, "It would have been
so foreign to Clive Epstein that I don't think that it would
have been workable."
Whatever the situation may have been, The Beatles
appeared to be willing to stick with Nems for the time being.
At the same time, they were also anxious to start handling
some of their own business and creative affairs. Only weeks
after Epstein's death, the first Apple project was already
well under way. Apple's first venture would be the production
of a new Beatles movie called Magical Mystery Tour which
was filmed and edited in various English locations from
September to November 1967. Cooked up by Paul McCartney
on a long flight back from America, Magical Mystery Tour
was intended to be a spontaneous, hip, art movie that would
capture the free-spirited vibe of the summer of 1967.
Since Apple had yet to develop any formal staff
structure, Beatles road manager Neil Aspinall and Paul McCartney
assumed most of the responsibility for coordinating the
various aspects of the film's production. The resulting
chaos - which ranged from the "Magical Mystery Tour" bus
and film crew venturing down small roads in rural England
only to encounter a bridge that was too low for the bus
to pass under, to not having enough hotel rooms for the
entire cast - surely must have made The Beatles miss the
brisk efficiency of the Nems organization.
For the first few months of Apple's existence,
it did not even have an office - most Apple business was
conducted from the Nems building. It was not until the autumn
of 1967 that Apple finally opened a London office. Since
The Beatles already owned a four-storey building at 94 Baker
Street, that had been purchased as an investment
property by their accountants, they decided that Baker Street
was as good a location as any for Apple. They set up an
office for Apple Music Publishing in the Baker Street building
Excited by the novelty of being businessmen
and anticipating Apple to develop further business interests,
The Beatles appointed their road manager, Neil Aspinall,
to be Managing Director of the budding Apple organization.
Aspinall recalled in an interview with Mojo, "A lot of people
were nominated or put themselves forward to run it... but
there didn't seem to be any unanimous choice. So I said
to them, foolishly I guess, 'Look, I'll do it until you
find somebody that you want to do it.'"
Fortunately for The Beatles, Aspinall was not
a typical beat group road manager. He was generally qualified
to do far more than book hotels, load vans and set up musical
instruments on a stage. Prior to becoming a full-time Beatles
employee in 1962, Aspinall had contemplated a business career
and had been close to completing a correspondence degree
in accounting before his work with The Beatles took him
away from his studies. But it was Aspinall's loyalty to
The Beatles, rather than his innate business sense, that
made him the natural choice to be Managing Director of Apple.
After Brian Epstein died in August 1967, Aspinall and fellow
road manager Mal Evans were the only non-Beatles left in
The Beatles' inner circle and the group placed a high premium
on trust and loyalty. The individual Beatles had complete
trust in Neil Aspinall and the surviving members continue
to do so to this day.
Unlike Aspinall, loyal Beatles road manager
Mal Evans would not fit as snugly into the Apple concept.
Though he would ultimately be given a free hand to scout
talent and dabble in record production for Apple, it was
agreed that Evans would probably be best suited to remain
as a road manager for The Beatles.
With Aspinall's time fully consumed by the combined
tasks of setting up Apple Corps and looking after The Beatles,
the responsibility of running Apple Music Publishing was
given to Terry Doran, a fellow Liverpudlian and friend of
the group who had been a business associate of Brian Epstein.
Prior to being named head of Apple Music Publishing, the
colourful Doran had run a car dealership that he co-owned
with Epstein. Doran is the first to admit that his experience
in auto sales was not particularly applicable to music publishing.
However, to The Beatles of 1967, enthusiasm and a social
familiarity were sometimes worth far more than practical
experience in a given field. To assist Terry Doran at Apple
Publishing, Carol Paddon and Dee Meehan were hired as secretaries
and Apple's first three employees were charged with setting
up an office at 94 Baker Street.
Doran may have had absolutely no experience
in music publishing, but he seemed to make the transition
we Publishing, Shotton was probably not the best person
to be put in
charge of a new Apple business. Prior to coming to London
to run the Apple Boutique, Shotton had been successfully
running a supermarket that John Lennon had bought for him
to manage in 1965. Although Shotton had no experience of
running a clothing boutique, the fact that he had run some
sort of store, combined with the fact that Lennon, Harrison
and McCartney had known Shotton since they were teenagers,
made the amiable Shotton the right person for the job as
far as The Beatles were concerned.
The hiring of individuals like Terry Doran and
Pete Shotton also illustrated how The Beatles hoped that
the open-minded business structure at Apple would provide
an opportunity for young, not necessarily traditional businessmen
to distinguish themselves in the world of commerce. Still
excited by the novelty of being businessmen, The Beatles
wanted to give friends from the same working class Liverpool
background as themselves a chance to show the world that
business was not the exclusive domain of the upper class,
private school educated section of British society.
With great fanfare, Apple announced to the press
that the Apple Boutique would open for business in November
1967. Predictably, due to several unforeseen delays, it
was not until the evening of 7 December 1967 that the Apple
Boutique finally opened its doors. To celebrate, Apple staged
a gala grand opening where George Harrison and John Lennon
mingled with invited guests who were feted with apple juice
and green Granny Smith apples.
The Apple Boutique officially opened for business
the following morning and the general public seemed to be
genuinely fascinated by The Beatles' new shop. Even in a
relatively progressive city like London, never before had
such a strange collection of merchandise been collected
under one roof.
The shop's stock was largely made up of vivid
psychedelic outfits and posters created by The Fool. The
boutique was also intended to serve as a retail outlet for
the gadgets created by Apple Electronics. These creations
included a transistor radio that could be used to broadcast
music directly from a record player and a small box with
randomly blinking lights that was dubbed "The Nothing Box".
Tellingly, by the time the boutique opened, the only contribution
that Apple Electronics had made to the boutique was to install
the lighting in the shop. Magic Alex had also promised The
Beatles a giant artificial sun to illuminate the opening
of the Apple Boutique, although he was apparently unable
to create anything that resembled that description.
The Fool had first come to The Beatles' attention
through the design work they had done for the Savile Theatre,
a London performance venue under the wing of Brian Epstein.
Greatly impressed with The Fool's sophisticated psychedelic
style, The Beatles hired the group to work on a variety
of projects, which included painting a piano and a gypsy
caravan for John Lennon, decorating the interior of George
Harrison's bungalow and creating the outfit that Ringo Starr
wore in the Our World broadcast performance of All You Need
When The Beatles decided to open the Apple Boutique,
The Fool were naturally asked to become the shop's in-house
designers. In addition to conjuring up an unusually garish
line of clothes, they were given the task of decorating
both the interior and the exterior of the boutique. With
an unrestricted budget and a brief to make The Beatles'
boutique stand out on the relatively staid street of shops
and private homes, The Fool designed a massive three-story
psychedelic mural to grace the side of the building.
The resulting mural - a brightly coloured Indian-styled
goddess that took up the entire side of the building - was
nothing if not striking. But while The Beatles were quite
pleased with the painting, other businesses in the area
were less-than-enamoured by The Fool's creation. Bowing
to pressure from the local council and the surrounding business
community, Apple was soon forced to paint the wall white
with a simple "Apple" scripted in the middle.
But having to paint over of The Fool's mural
was the least of Apple's problems. Despite the steady flow
of curious tourists and students who made their way to the
shop, the Apple Boutique made little money. It seems that
in addition to having to contend with uninhibited staff
helping themselves to cash from the till, the boutique's
stock was not as enticing to the public as The Beatles had
anticipated. Outfits like designer Harold Tillman's see-through
chiffon tuxedo that had seemed very hip in the psychedelic
summer of 1967 looked quite out of place on the cold streets
of London during the winter of 1967-68, and, for the most
part, remained unsold.
In his fascinating memoir The Love You Make,
Peter Brown remembers the Apple Boutique as a very unusual
place of business. "Customers seemed to be there only to
shoplift or to stare at Jenny Boyd [George Harrison's sister-in-law]
who was working there as a salesperson along with a self-styled
mystic named Caleb. Caleb slept underneath a showcase on
one of his many breaks. The store was also sometimes tended
by a fat lady who dressed in authentic gypsy costumes."
Reflecting further, Peter Brown admits that,
"The Apple Boutique was a bit of a rip off. It was a case
of The Beatles trying to be too cool for their own good.
It was a beautiful shop. The merchandise looked great. I
don't think it was very good quality, but you weren't looking
for something to last forever, you were looking to look
great next Saturday. Looking back, I suppose it's no worse
than the rag industry today, where designers do what they
can to take the capital they are given and run with it.
But The Fool were really pretty hypocritical. They were
pretending to be these cool, lovely people when they were
in fact a bit less than scrupulous in the way they did things.
The Fool would totally run rings around poor Pete Shotton.
There was always this problem of them saying, 'Don't say
that to me because we're too cool for it,' and he would
be confronted with this problem of trying to be a businessman
while trying to be cool at the same time."
Brown also insists that, contrary to popular
belief, The Beatles were quite aware that the Apple Boutique
was rapidly getting out of control. In January 1968, Pete
Shotton was replaced by a more experienced retailer named
John Lyndon. Realizing what he was up against, Lyndon immediately
instituted more responsible business practices for the shop
and made a valiant attempt to reign in The Fool's excessive
expenditure. Despite Lyndon's efforts, it was estimated
that the shop went on to eventually lose close to $400,000.
On top of the money that was lost at the shop, it is alleged
that the Apple organization would also have to write-off
the cost of a Jaguar sports car that Apple had purchased
for Pete Shotton but which it had never reclaimed after
Shotton left the company.
To complement the Apple Boutique, Apple Retail
set up a second operation called Apple Tailoring (Civil
and Theatrical) in a shop at 161 King's Road. Established
on 2 February 1968 and officially opened on 23 May, the
shop was a partnership with John Crittle, the highly respected
designer, who was a Director of the enterprise along with
Apple's Neil Aspinall and Apple accountant Stephen Maltz.
By the end of 1967 Apple had developed into
an interesting little company. Given that The Beatles had
started the year with only a vague concept for starting
a business to minimize their tax exposure, the fact that
they managed to set up two fully functioning companies by
the end of the year suggested that they had big plans for
Apple in 1968.