Update: Turns out, Apple is saying this is an unsubstantiated rumor.

“This is not news nor is it a scoop,” says an Apple Inc. spokesman, declining further comment.

In a USA Today interview, Steve Jobs said that:

It will happen — I hope by the first half of next year. As soon as they’re ready, we’re ready.

The original story:

Get ready to welcome Sgt. Pepper to your iPod. Sir Paul has finally reached an agreement with Apple and the iTunes store. For $400 million, they will receive the Beatles’ back catalog. Proceeds will be divided between McCartney, Ringo Starr, the families of John Lennon and George Harrison, and no doubt will trickle down to Heather Mills. Michael Jackson, EMI, and Sony, who also own part of the Beatles music, will also receive stipends as part of the deal.