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NBC wants back into Apple’s iTunes Store
Wednesday, April 16, 2008 - 03:37 PM EDT

"NBC Universal would like to have its TV shows distributed once again through Apple's iTunes service, a top executive said Wednesday, but he called for antipiracy measures to help protect his business' revenue," Stephen Shankland reports for CNET.

MacDailyNews Take: When will these people learn? DRM doesn't work. Pirates will always pirate, regardless of whatever antipiracy measures are used. Just get the content available in a timely fashion, in good quality for a reasonable price and you'll make money.

Shankland continues, "George Kliavkoff, chief digital officer at NBC Universal, didn't specifically mention Apple by name in his request, but it was clear he had the iPod maker in mind when it came to combating people's consumption of pirated content."

Shankland reports, "'If you look at studies about MP3 players, especially leading MP3 players and what portion of that content is pirated, and think about how that content gets onto that device, it has to go through a gatekeeping piece of software, which would be a convenient place to put some antipiracy measures,' Kliavkoff said in an onstage interview at the Ad:Tech conference here. One of the big issues for NBC is piracy. We are financially harmed every day by piracy. It results in us not being able to invest as much money in the next generation of film and TV products.'"

MacDailyNews Take: Dummy doesn't get it.

Shankland continues, "In 2007, NBC Universal pulled its TV content from iTunes when the two companies disagreed about pricing. Kliavkoff made it clear that he'd like the conduit back, though. 'We'd love to be on iTunes. It has a great customer experience. We'd love to figure out a way to distribute our content on iTunes,' he said, but wouldn't comment on any negotiations. 'We have film distribution with iTunes so yes, we do talk to Apple,' he said."

"Price appears still to be a sticking point," Shankland reports.

MacDailyNews Take: So, now we finally get to the heart of the matter.

Shankland continues, "'The music industry guys would have something to say about how the pricing has affected their product over the last few years,' Kliavkoff said.

MacDailyNews Take: The music industry is not negatively affected by Apple's pricing. They are negatively affected because consumers can now choose and are no longer forced to buy bundles (albums on CD) at exorbitant prices. Tough. Don't blame Apple because technology allowed for consumer choice. Last we looked, Apple sells the music labels' product and gives them the bulk of the money. Again: DRM doesn't work. Pirates will always pirate, regardless of whatever antipiracy measures are used. Just get the content available in a timely fashion, in good quality for a reasonable price and you'll make money.

Shankland continues, "The Apple-NBC Universal spat has been a game of brinksmanship over which company needs the other more. Analysts at Forrester Research think Apple needs the content more than NBC needs the distribution."

Full article here.

[Thanks to MacDailyNews Reader "NeverFade" for the heads up.]

MacDailyNews Take: The analysts at Forrester Research or anywhere else who think that Apple needs the content more than NBC needs the distribution are idiots. Here's why.

Jobs will let NBC back when NBC does as they are told by those who built, own, and operate the market-dominating iTunes Store.


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Apr 16, 08 - 03:43 pm Comment from: derelict

For one thing, video is DRM'd in iTunes, and I think as effectively as it can. And DRM is much more appropriate for video than music as well, given the way its used. But I say, why doesn't apple just portal things like aTV and iPhone/Touch to the network streaming websites, where they can continue to use ad-based revenue? And come to think of it, why don't network websites just adopt the Quicktime format so I can use my iphone to go to NBC.com, and watch their episodes and their ads on their terms? I'd prefer that over everything. aTV should allow the same BTW. It should allow you to surf ABC, NBC, VONGO, JOOST, and all those just like it does You Tube. That would keep the markets seperate (Hardware vs Content) and alleviate all these concerns

Apr 16, 08 - 03:52 pm Comment from: megaME

screw nbc.

I like some of their shows, but if they want to be jerks, I can keep getting their shows from other sources.

I don't mind paying a little. That is all it is worth to me. Stupid tv shows rot the mind anyway.

Keep acting tough with apple, hello torrents.

Apr 16, 08 - 03:53 pm Comment from: Madmax

NBC turkeys voted for Christmas - why should Apple let them out of the stove

Apr 16, 08 - 03:54 pm Comment from: JAYGEE

I don't understand what's going on with the price? Aren't Apple letting NBC sell their content at the price they want?

If that's true, shouldn't it be up to NBC to decide the price of the content that is sold, since it is owned by NBC?

Apr 16, 08 - 03:57 pm Comment from: Quad Core

I know I will get flamed for saying some of this, but isn't it all quite obvious?

The TV industry already has a successful model that can work quite well AND prevent piracy problems.

Ad-supported distribution. If you run the content the same way you do on TV (22 minutes of programming with 8 minutes of commercials) and then provide the content for download, piracy will vanish, as you can get it just as quickly from the source as you can a pirate.

With this model, the distributor pays NOTHING for anti-piracy, makes money from advertisers, and the advertisers will know exactly how many times it was downloaded. Everybody wins.

Apr 16, 08 - 03:59 pm Comment from: HMCIV

Hello episodes of Battlestar Galactica!!! (The new one with Edward James Olmos who kicks fraking @ss.)

Apr 16, 08 - 04:00 pm Comment from: 84 Mac Guy

The other day I had the "pleasure" of experiencing one of NBC's alternatives to the iTunes Store. I tried to watch an episode of Battlestar Gallatica on the Sci-Fi channel site. My watching was hampered by:

1. A crapload of commercials
2. I was limited to watching in a small window on my computer screen.
3. I had no control over the streaming so after every 2 minutes, the video stopped for a minute so the streaming could catch up.

Hey NBC, please take my two freakin' dollars and let me watch your show commercial free and without streaming issues from the iTunes Store. Even though free is a really good price, quality is worth my $2.

Apr 16, 08 - 04:02 pm Comment from: Buster

Let'em back in but charge'em an entrance fee for the privilege

Apr 16, 08 - 04:05 pm Comment from: peragrin

Actually the fact that NBC cracked first as to want back, is a sign that NBC needs apples distribution. They probably realized they are spending more money, and getting less watches than they had when they were on itunes to begin with.

I know i don't watch shows from them any more.

Apr 16, 08 - 04:07 pm Comment from: The Dark Side of the Moon

(in the voice of Dwight Schrute)

"Question: What more piracy prevention/DRM does NBC need for TV shows that isn't already there?"

Apr 16, 08 - 04:10 pm Comment from: His Shadow

HAHAHAHAHAHAHAHAHAHAHAHAHAHAAAAAAAAAAA

Apr 16, 08 - 04:11 pm Comment from: Guessing

NBC wants back in the iTS? Hmmm.. wonder why. Is it because they are dead last in ratings and people are upset at Zucker? Not making any money with Hulu? Was a matter of time, wasn't it. Hope the music execs learn and open up all their content to the iTunes+ music store.. The Amazon decision is not hurting the iTS.

Apr 16, 08 - 04:14 pm Comment from: Nutcracker

Haha... Screw NBC

MaWo: 'final'. As in, the word which Apple has...

Suck it, a-holes.

Apr 16, 08 - 04:15 pm Comment from: MacMarc

NBC considers music ripped from legally purchased CD's to be "pirated."

What @**holes!

Apr 16, 08 - 04:18 pm Comment from: Demon

The wholesale price is nogosiated with Apple and the content provider. NBC wanted to do away with single shows and go to just having Apple iTunes sell bundles a good show and a bad show or two model with a combined Wholesale price equal to the wholesale price of each show if each show were a hit show. Apple said are you nuts customer don't want the crappy shows forced on them like that and it's raise the cost of the shows people want to watch by too much. NBC insisted and Apple said good for you enjoy the loss.

NBC wanting back into iTunes shows that they need Apple much more then Apple needs them.
NBC direct or Hulu are easy to game and get the souce FLV file. Converting it to AppleTV or iPod is a snap with Visual Hub too. No need to worry about the ads either. Piracy? I get it from NBC's site and convert it to a watchable format so, it's not piracy in my opion, and I'm not making it available to others either.

Apr 16, 08 - 04:19 pm Comment from: Think about it...

MDN- you can't really be so blinded by the holy Apple logo that you think that NBC needs Apple more than Apple needs NBC? Put down the apple rapped joint and listen up, stoner!

NBC and other content providers is the reason iTunes is there! With no content, why would we have iTunes, besides to play the movies or music I illegally steal from bittorrents! DUH!

Listen, I think Apple is a great company with some of the best electronics/software for this day in age... but lets not forget where Apple has been and where they want to be.

I think NBC has every right to say to Apple what the price should be. Hell, let them make it outrageous! Then CBS, ABC and all the others will benifit and then NBC will see their error.

Apple needs NBC has much as the providers need Apple. PERIOD!

Apr 16, 08 - 04:19 pm Comment from: trex67

"NBC wants back into Apple’s iTunes Store"

That didn't take long. I wonder how much free money they lost in the last few months?

Apr 16, 08 - 04:19 pm Comment from: Macromancer

@ 84 Mac Guy

I had the same experience on the SciFi website. I gave up watching after just a few minutes and watched it *cough cough* using *cough* ALTERNATIVE means.

Apr 16, 08 - 04:19 pm Comment from: Zune Tang®

Who cares. What I want to know is when is NBC content going to be available on Xbox Live? That's the future. In a couple of years only a few people will remember I-Tunes or I-Pods. It's a Zune and Xbox world now folks.

Your potential. Our passion.™

Apr 16, 08 - 04:20 pm Comment from: Chaz

Guess the boys at GE don't like wearing the shoe on the other foot.

Guess what, distributors set the price. I can't tell you how many goods GE used to buy in the US and forced to Mexico, China and India. Why, because they wanted their costs lower, and some of the product (WalMart does this all the time) they just take it over to the low cost countries and tell them to copy it.

No fun having price dictated to you is it.

Apr 16, 08 - 04:30 pm Comment from: Chaz

Jaygee

Retailers / distributors own the "shelf space". It's up to the manufacturers / creators to price their product to get the shelf space allocated to their product.

Retailer decides how much space to allocate based on customer demand, margin, alternatives.

Simply put, NBC priced themselves out of Apples store. In the case of Apple, they have decided provide as good of an experience as possible. The content has to be fairly priced to make the purchase of the player and content compelling to consumer. Costs have to be low if they are going to expand the market beyond where it is now.

Apr 16, 08 - 04:30 pm Comment from: Spark

There was value to obtaining TV shows for the iPod and iPhone because of their mobility, along with the time shifting. I'm not going to make any kind of practice of watching TV shows, I may have missed, on my computer screen. You can't currently take an internet connection to NBC.com or Hulu, or any other streamed source while you are on a cross country road trip, or on an airplane or subway. NBC should recognize that sales through iTunes does not subtract from gross revenues derived from TV productions, it is gravy. Are any of Hulu's advertisers going to reduce their participation if the same program is sold on the iTunes Store? I doubt it, they serve different market segments. And as the first poster (FIRST!) stated, Apple has DRM, and has worked hard to maintain its integrity. I don't even know why the NBC guy is raising that as an issue in relationship to Apple. I'd like to see ANY evidence that iTunes sourced TV shows are being bit-torrented.

Apr 16, 08 - 04:34 pm Comment from: Pete

"They can mark up the price and make a profit or use it as a loss leader to get people in the door," Kliavkoff said. "It's really difficult for us to work with any distribution partner who says 'Here's the wholesale price and the retail price,' especially when the price doesn't reflect the full value of the product."

"'The music industry guys would have something to say about how the pricing has affected their product over the last few years,' Kliavkoff said.

We see what he means. Amazon is doing what the music industry wants by offering DRM-free tracks as a loss leader! Why, so that they cannibalize their own CD sales?

It's like people have the time to shop around for a TV show! Today, I'll buy the show in this format for $1.49 tomorrow I'll buy the same show in another format for $1.89. And I need several incompatible devices and media software to use them.

Kliavkoff, why don't you try it yourself for a while before you preach it. It seems you have never been a consumer yourself.

Apr 16, 08 - 04:34 pm Comment from: MCCFR

Wow, what a steaming pile!

Here's a challenge for Mr. Kliavkoff: take your content out of all the legal download services, including Hulu, for the upcoming 2008/9 season.

And then check, in January, how much of your content is available in high quality on BitTorrent sites.

Now ask yourself how it got there and why does so little of it seem to have any station ident logos on screen.

And then you'll realise that people are just grabbing your content as you bounce it - unencrypted - off a satellite to get to your affiliate stations.

Apr 16, 08 - 04:44 pm Comment from: Missy Pants

NBC
Hahahahaha!

I hope Steve says,
"Mmm, no."
*click*.

Apr 16, 08 - 04:49 pm Comment from: JAYGEE

@ Chaz

I still think NBC should sell their content at the price they want.

Apr 16, 08 - 04:52 pm Comment from: spaceMan

Pricing, DRM, and all the various permutations on one side of the equation, simplicity on the other.

It's a tough balancing act to make all the variables work for everyone. The most important (in my opinion) is to keep the customer happy, and don't confuse with too much complexity.

It's the KISS princiiple - it's why we see one-click buying, standard pricing, and so on.

The risk of too many permutations is customer fatigue..

Apple's right to insist on the less complex model.

The content suppliers are still making a truck load of money... it's just greed that drives the truck even faster!

Apr 16, 08 - 04:54 pm Comment from: george

Um, MCCFR, NBC's sat feed is scrambled and has been for about 20 years when Telco distribution was eliminated and C band was dropped for KU Sat Distribution. Demon has it right. NBC wanted to bundle crap. Demon is also right in that quicktime supports disabled FF/REW at the producer's discretion, so ad-supported shows through iTunes is here and now. NBC should wake up before it's too late. And if I was a cable company, I'd be planning an exit strategy for the cable business. Maybe a Comcastic/Yahoo/MS/Dell uber merger will save their bacon.

Apr 16, 08 - 04:57 pm Comment from: nekogami13

Hulu works nicely and through the miracle of ad block + in firefox I do not get the commercials either.

Yep, hulu has a flaw-adblock stops there commercials from showing.

Apr 16, 08 - 05:02 pm Comment from: Pig Vomit

"Dubya eeeeeeeen Bee Cee"

Apr 16, 08 - 05:15 pm Comment from: Moo

Poor deluded "Think about it"...

I haven't watched a thing from NBC since they declared war on me, the consumer.

Sooooo... you can't really be so blinded by the holy NBC logo that you think that Apple needs NBC more than NBC needs Apple? Put down the NBC rapped joint and listen up, stoner!

Once again, "Think about it"

I have not watched a thing from NBC since they declared war on me, the consumer.
I do, however, continue to this very day to buy content from iTunes, so I'd say NBC needs Apple a LOT more than the flipside.

Apr 16, 08 - 05:18 pm Comment from: studentrights

Whahahahahah! They are ready to come crawling back!

I guess they're tired of giving away their product for free on Bit Torrent networks.

Apr 16, 08 - 05:18 pm Comment from: Jim Klaas

When NBC was on iTunes I subscribed and bought a season pass to two shows...when they went off, I stopped watching them. I don't own a TV. If it ain't on iTunes, it doesn't exist....

The Beatles is a really good example...in a few years...who cares who they were.....I'd pick up a special addition Yellow Sub iPhone if they did one....ha...that is coming next...limited ed iPhones....

Apr 16, 08 - 05:25 pm Comment from: Jeff

What NBC is looking for is not more DRM on the content you buy from the iTunes store, They are looking for Apple to police everything that passes through iTunes, so if you have a Movie you have purchased and ripped, they want Apple to stop you from putting it on your iPod. Apple knows the day they do that is the day that iTunes stops being the Number 1 distribution channel for digital content and shortly there after seises to exist.

Apr 16, 08 - 05:26 pm Comment from: Moo

JAYGEE,

Ah, young Padawan.

NBC does, indeed, have the right to price their content as NBC sees fit.

NBC does NOT, however, have the RIGHT to sell their content on iTunes.

iTunes is the property of Apple, and if NBC wishes to sell content using Apple's outlet, then Apple does indeed have a say in the pricing.

If NBC does not like Apple's answer, then NBC is free to try and make it somewhere else.

The very idea that NBC is coming back to the table suggests that their icicles weren't fairing too well in Hell.

Apr 16, 08 - 05:27 pm Comment from: Anti-commercialism

You people who are promoting the idea of streaming video and commercials just don't get it. People do not want to watch skippy, poor quality video that they have to watch in one sitting. People are sick of paying for cable and satellite TV and still getting commercials and censored programming.

Streaming video is not the answer to anti-piracy either. You are VERY naive if you believe so. There are already tools out there to convert streaming video to video files. The bottom line is that once it gets to the home computer, it can be duplicated.

Apr 16, 08 - 05:33 pm Comment from: MCCFR

George…

If what you say is true (and I have no reason to believe it isn't), something is porous in the networks' distribution mechanism because some episodes of shows are turning up as BitTorrents prior to broadcast.

Apr 16, 08 - 06:42 pm Comment from: KenC

Bundling tv shows, one good with one bad, reminds me of something in another industry....hmmmm... what could it be?

Could it be an "album"? In the music industry, they bundle a couple good songs with about 10 bad ones, and call it an album. On a 45, they bundle an A-side track with a throwaway B-side.

On principal, Apple should be opposed to NBC's bundling, aka album, concept.

Apr 16, 08 - 07:02 pm Comment from: george

MCCFR: Post production facilities have had late night tape dubbers copy and post them (the main way a title is available without network logo), but facilities are clamping down and several employees have been sentenced to prison. The networks are also switching to IP-based storage, so rather than numerous tape copies floating around, it's beginning to be all very securely managed. A company I used to work for handles asset storage and internet encoding for big sites and studios and they have gone 100% tapeless, both for efficiency and security.FInally, local affiliates used to get pre-feeds late at night, but that's been phased out since 24 hour programming. All networks sat feeds are scrambled. The best you can do is find a unprotected back-haul (remote location to network) for a live show or live news report, but most of them are sent now via fiber.

Apr 16, 08 - 07:11 pm Comment from: mark

What NBC wants is for the iTunes player software to pick out pirated material and block it from playing. Apple has no interest in being the gatekeeper. As it is, most pirated material is in formats (divx, avi) that iTunes doesn't even play.

If NBC wants to go after a gatekeeper, they should be going after the VLC player.

Apr 16, 08 - 07:35 pm Comment from: bizlaw

MDN's attitude of "pirates will always pirate, so why fight them?" is terrible. If you don't fight piracy, whether it's TV shows, music, or treasure on Spanish ships in the Caribbean, the pirates will multiply like rabbits.

DRM may not be the answer, but the content providers have a point that they do lose money because of piracy, and it also costs them money to use anti-piracy technologies. It will always be a cat-and-mouse game, but you can't let pirates get away with stealing or it will become the norm rather than the exception.

By the way NBC, if I buy a CD and rip it to iTunes and my iPhone, I'm not stealing – I'm just using my legally purchased material in another medium. I can't listen to my CD and iPhone at the same time. Now if I rip my CD to iTunes and then give the CD to a friend, now I'm a pirate because my friend didn't pay for the CD.

No problem with that, just don't call me a thief for using what I legally purchased. I'm not buying it twice.

Apr 16, 08 - 08:34 pm Comment from: Tommyr

Tell NBC to go F&^K themselves.

Simple.

Apr 16, 08 - 08:57 pm Comment from: willyboy

@ Tommyr

You mean to go "Frack" themselves.

Apr 16, 08 - 09:19 pm Comment from: Mike the Rookie

If it were not for The Office, I wouldn't watch NBC at all.

Apr 16, 08 - 09:29 pm Comment from: Synthmeister

All I can think of is that scene from Die Hard, where John McClain says, "Welcome to the party!"

Apr 16, 08 - 09:33 pm Comment from: dan

Jobs: hi Jeff (Zucker), hows it hanging? I hear your guys want to resume selling your TV shows on iTunes.
Zucker: Um, yeah, Steve, but there still remains that DRM matter and the variable pricing / bundling matter my peeps say we need...
Jobs: Siooma, Jeff. You walked. Now look at your market share. Bad move, boyo. Go grow your own digital distribution network, bokay? What was that? Hulu what? Um, that's great, Jeff. Let your viewers stay before their laptops squinting at grainy small windowed versions of your crapass shows. We're going places and you're not a passenger. Unless...

Apr 17, 08 - 01:44 am Comment from: Dan

As Anthony Hopkins said in A Bridge Too Far...

Tell them to go to hell.

Apr 17, 08 - 09:45 am Comment from: John Gee

Hello...

NBC is just giving the appearance that they had a reason to pull out to begin with...If they just came back, they'd look like complete losers.

Apr 17, 08 - 04:15 pm Comment from: Conga Rick

I purchased several season's worth of NBC shows prior to their withdrawal from iTunes. Since then, I've lost interest on those shows, and will be slow to return to my prior TV viewing habits.

NBC: you shot yourselves in your greedy, corporate feet!

Apr 17, 08 - 07:05 pm Comment from: nekogami13

What we all are missing is NBC requesting an anti-piracy measure embedded in iTunes preventing putting any content not paid for on your iPod.

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