Indeed, as I understand it starting a record label is exactly the one thing which Apple Computer is forbidden from doing, thanks to an earlier deal with Apple Records.

I remember the story that this caused a little bit of concern in Apple's legal department when the first macs with built-in microphones were released. This, supposedly, is the reason why the update of the sound software released with those new macs included the new system beep sound "Sosumi".

I also remember in those days when I read the story how ridiculous the idea that Apple Computer would start a record label sounded. Just a sign of how much things have changed.

Author here: Excellent point. It fits with the story.

With Yoko's late confirmation on Twitter that the Beatles will be on iTunes tomorrow, the last hurdle is clear. The Apple Records/Apple Computer debacle will be put to bed at last as Apple turns iTunes into a label. Yoko, EMI, and the MJ Estate see a fat pay day in exchange (probably no cut taken by apple).

And people have been wondering why Apple was hoarding so much cash...