NBC's iTunes return may hinge on offline piracy filtering

[AppleInsider]

NBC made it clear this week that it would like to resume selling its television programming through the iTunes Store, but only if Apple makes changes to its client software that would allow it to serve as the gatekeeper for all forms of potentially pirated media.

George Kliavkoff, chief digital officer at NBC Universal, made the assertion during an on-stage interview at the Ad:Tech conference in San Francisco this week, in which he didn't specifically call out the iPod maker and iTunes operator by name.

"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," he said "One of the big issues for NBC is piracy. We are financially harmed every day by piracy."

Since Apple already embeds digital rights management (DRM) software within each audio and video file it sells, it appears that Kliavkoff is requesting that the company go a step further and police every piece of digital media a user imports into his or her iTunes library, regardless of its origin.

Oddly, when NBC Universal yanked its TV shows from iTunes last fall, the primary issue was reported to be pricing, not piracy. It's now clear, however, the television studio is seeking concessions in both areas.

"We'd love to be on iTunes. It has a great customer experience," Kliavkoff said. "We'd love to figure out a way to distribute our content on iTunes."

In addition to the added anti-piracy measures, NBC wants the right to determine the cost Apple pays for its programming, not the other way around.

"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."

Prior to the fallout between the two parties, NBC supplied the iTunes Store with over 1,500 hours of programming that accounted for more than 30 percent of the service's television show revenues, including three of the 10 best selling shows during the summer season.

[ View this article at AppleInsider.com ]

[gloss]

Guess who would stop using the iTunes/iPod ecosystem if this happened?

[BRussell]

The piracy bit is such nonsense. There is no widespread piracy of iTunes videos. They're much safer than DVDs or TV broadcasts.

[mrjoec123]

Originally Posted by BRussell

The piracy bit is such nonsense. There is no widespread piracy of iTunes videos. They're much safer than DVDs or TV broadcasts.

If you ask me, this is a sure early sign that Hulu isn't working, and NBC wants to come back to iTunes in the worst way. But they're trying to save face by attacking Apple again.

This guy played his hand, and lost big time. Steve called his bluff.

Give it a year, at most. Kliavkoff will be fired, and NBC will be back on iTunes, with none of these draconian measures implemented. There's simply no way Steve will agree to any of it. Not the variable pricing, not the anti-piracy. None of it.

[jeromatron]

So how are they going to determine whether it's legitimate content or not?

[JeffDM]

I'm sure there are a lot of iPods with mostly pirated material. The rest of the non-itunes sourced stuff may be legitimate format-shift or time-shift material.

It doesn't matter what NBC does, or what iTunes does for NBC (or themselves for that matter), it's going to be impossible to stop the illicit distribution,

It's all pretty silly once you consider that NBC is broadcast "in the clear". Hamstringing the iPod is only going to drive the file traders to buy Chinese brand players that will just play just about any pirated format.

[rbonner]

This does not make a ton of sense.

Doesn't iTunes do a great job of keeping me from just coping the content to another system? I have tried, I am limited to 5 computers, which with a large family can get in the way.

On the way into iTunes, there is the possibility that I am loading my purchased series that I want to watch on Apple TV, so on the way in it going to be tough to monitor.

[NTropy]

Originally Posted by AppleInsider

NBC made it clear this week that it would like to resume selling its television programming through the iTunes Store, but only if Apple makes changes to its client software that would allow it to serve as the gatekeeper for all forms of potentially pirated media.

Since Apple already embeds digital rights management (DRM) software within each audio and video file it sells, it appears that Kliavkoff is requesting that the company go a step further and police every piece of digital media a user imports into his or her iTunes library, regardless of its origin.

Oddly, when NBC Universal yanked its TV shows from iTunes last fall, the primary issue was reported to be pricing, not piracy. It's now clear, however, the television studio is seeking concessions in both areas.

In addition to the added anti-piracy measures, NBC wants the right to determine the cost Apple pays for its programming, not the other way around.

[ View this article at AppleInsider.com ]

Face saving at its finest. I seriously doubt piracy is a real issue but NBC had to figure out an excuse to save face before crawling back to iTunes.

BTW - looooooong time reader. Since before this was AppleInsider even. I've just never felt compelled to register and comment.

[DeaPeaJay]

Jobs must be frustrated that NBC is run by such a quack. I know I would be. That whole schpeal was absurd.

[Virgil-TB2]

Originally Posted by AppleInsider

NBC made it clear this week that it would like to resume selling its television programming through the iTunes Store, but only if Apple makes changes to its client software that would allow it to serve as the gatekeeper for all forms of potentially pirated media...

The *only* way to do this would be for Apple to adopt a Microsoft style procedure of scanning your computer and sending back the information to the "gatekeepers" at Apple so they could turn you in to the cops. So, Steve Jobs would have to go back on his word, Apple would have to reverse all their previous policy and put the lie to all their previous statements on the matter etc.

The day that happens is the day that huge numbers of people have bonfires of Apple computers all across the country. Public relations disaster of cosmic proportions IMO and not going to happen.

[SpamSandwich]

Originally Posted by gloss

Guess who would stop using the iTunes/iPod ecosystem if this happened?

Everyone?

[Clark4Bucks]

Does this mean I would not be able to store my own music and video in my iTunes library? How will they determine what is blocked? I hope Apple does not give into this. I for one would look for an alternative.

On a side note, Hulu is not a bad product; however, I just don't watch long videos on my computer. I want something I can sync to my Apple TV or iPod.

[SpamSandwich]

Originally Posted by mrjoec123

If you ask me, this is a sure early sign that Hulu isn't working, and NBC wants to come back to iTunes in the worst way. But they're trying to save face by attacking Apple again.

This guy played his hand, and lost big time. Steve called his bluff.

Give it a year, at most. Kliavkoff will be fired, and NBC will be back on iTunes, with none of these draconian measures implemented. There's simply no way Steve will agree to any of it. Not the variable pricing, not the anti-piracy. None of it.

They should point NBC toward the door and give 'em a shove for encouragement as they fall down the stairs.

[omnivector]

I hereby name George Kliavkoff for the "biggest douche in the universe" award. I doubt he has much chance of ever surpassing John Edward but at this pace, he's well on his way.

[Gandalf the Semi-Coherent]

"One of the big issues for NBC is piracy. We are financially harmed every day by piracy."

No, Mr. Kliavkoff, NBC is financially harmed every day by your own stupidity.

I want to watch Battlestar Galactica whenever I want, wherever I want. This includes watching it on my brand-new HDTV that I got last month specifically on which to watch this show. I am gladly willing to hand you over $1.99 per episode for this privilege.

It is nice that I can watch season four episodes of BSG on Hulu. Unfortunately, I cannot drag my iMac with me wherever I go. And I find your repetitive commercials and your crappy streaming to be annoying. Therefore, to create the experience I seek, I have resorted to accessing BitTorrent in order to download episodes that I can later transfer to my iPod and watch on my TV. As a result, you have not received a dime in revenue from me, revenue I am more than willing to pay you... if not for your recent stupidity regarding what consumers like me truly want.

That is how you are losing sales to piracy. Not because of anything Apple has done. It's because of what you have done. I assume your stockholders are reasonably bright enough to understand this as well, and I'm sure they will be happy to tell you at the next stockholders' meeting.

"We'd love to be on iTunes. It has a great customer experience," Kliavkoff said. "We'd love to figure out a way to distribute our content on iTunes."

No, Mr. Kliavkoff, you'd love to figure out a way to save face after making such an arrogant blunder. This is not possible. Therefore, if you cannot admit you made a bad decision, return your content to iTunes post-haste and play by their rules--which are not Draconian and anti-consumer--you should seriously consider updating your resume, as your job is in jeopardy.

"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."

No, Mr. Kliavkoff, the market will determine the full value of the product. Not you. And the market has spoken. $1.99 is fair. Anything more is pure greed. And pure greed on the part of content providers is one of the reasons for piracy. Price it fairly and we'll gladly pay. Try to fleece us and we'll find other options.

--GTSC

[bloodstains]

Originally Posted by NTropy

Face saving at its finest. I seriously doubt piracy is a real issue but NBC had to figure out an excuse to save face before crawling back to iTunes.

I don't know. If they were trying to save face they should have asked for something Apple would actually implement.

Also - His assertion that music "has to go through a gatekeeping piece of software" isn't true. Before the iTunes and iPod ecosystem that piece of "software" was usually called an Operating System. Although I'm sure he would love OS level anti-piracy controls.

[mrsteveman1]

Since when does NBC have anything they could even USE as a loss leader? Most of their content sucks, and they are in no position to make demands like this.

NBC is well outside of whatever miniscule rights they have at the moment to demand that Apple turn iTunes into some kind of anti-piracy gatekeeper just to prevent pirated stuff from being loaded on to iPods. Won't happen, go away NBC.

[shamino]

Complete BS. NBC is assuming that we're all idiots with no memory.

When they pulled out of iTunes, they said it was because they wanted to charge more money per track, and they wanted to prevent loading content onto iPods.

Now today they're simply repeating that mantra, but with the added lie that loading a legally-purchased DRM-wrapped video clip onto an iPod (an action explicitly permitted by the EULA) somehow constitutes piracy.

Personally, I wouldn't even bother reporting stories like this. It won't be news until NBC says something they haven't already said many times in the past.

[walshbj]

ntropy - I would agree that NBC and its remarkably bad decisions regarding iTunes is worth registering for! I can't believe people haven't been fired over this decision yet.

I'm trying to remember how the networks reacted when VCRs came out. I don't think they distributed their shows on tape for quite a while....but my memory is fuzzy.

[Jack Mac]

Take a hike NBC. What we don't have we won't miss. Let NBC's stockholders decide if they want to remain frozen in the Ice Age or want to hope on board Apple's fair train and pick up more revenue. Simplify and dump the chief digital moron!

[studiomusic]

How about content makers putting a watermark on their creations or coming up with a way to secure what they make? That way there's no need for a gatekeeper. Why should they need to rely on Apple???

[minderbinder]

Originally Posted by BRussell

The piracy bit is such nonsense. There is no widespread piracy of iTunes videos. They're much safer than DVDs or TV broadcasts.

The issue isn't piracy of itunes videos, I think that's pretty much non-existent. It sounds like NBC wants iTunes to somehow recognize a video from bittorrent and either block it from working or report the user.

I don't see how that's technologically possible, how would iTunes be able to tell a pirated movie or TV show from something released free on the net, or a users own home movie?

Seems like a ludicrous and completely unrealistic request from NBC.

And I have to agree that I'd probably use something like Hulu or the other sites streaming TV shows, but so far there's no way to watch them on my TV set. Get together with apple and make them appleTV compatible, and you'll get my business.

[mdriftmeyer]

Our network, NBC, is financially bleeding like a sinking ship.

We'll offer our catalogue, once again, if you change your software to suit our needs.

We can't control the pricing but we now are going to control your software/business model?

Tough luck NBC. You blew it.

[eAi]

Even if they could fingerprint every illegal video, it would be trivial to write a program that would subtly adjust the video to avoid the fingerprint. They've been using the same theory themselves to hide data in video and audio for tracking... Apple would have a dud player if they ever did this.

[wirc]

Originally Posted by Clark4Bucks

Does this mean I would not be able to store my own music and video in my iTunes library? How will they determine what is blocked? I hope Apple does not give into this. I for one would look for an alternative.

On a side note, Hulu is not a bad product; however, I just don't watch long videos on my computer. I want something I can sync to my Apple TV or iPod.

I must say, this plan reeks of technical unfeasibility, complete lockdown, and big brother spyware nonsense (pick as many as you like). How will they determine that the CD I am ripping is not one I bought in a store? How do they know which MP3s I bought from Amazon.com and which I downloaded after someone else put them onto file-sharing networks?

In my ignorance of high-level programming, I can't see a reasonable way to do this, besides locking the ecosystem down to nothing but that which is purchased in the iTS. It's crap, and I'm sure half the people on the board understand DRM better than he.

[Slewis]

Null.

[minderbinder]

Originally Posted by shamino

Now today they're simply repeating that mantra, but with the added lie that loading a legally-purchased DRM-wrapped video clip onto an iPod (an action explicitly permitted by the EULA) somehow constitutes piracy.

Unless I missed it, they're not saying that (correct me if I'm wrong). They're just talking about people pirating movies and shows from torrents and wanting iTunes to somehow block those from iPods and aTV.

Originally Posted by studiomusic

How about content makers putting a watermark on their creations or coming up with a way to secure what they make? That way there's no need for a gatekeeper. Why should they need to rely on Apple???

And how would they do that? How would such a thing be possible with any video, much less broadcast TV?

[studiomusic]

Originally Posted by minderbinder

And how would they do that? How would such a thing be possible with any video, much less broadcast TV?

EXACTLY!

[corinhorn]

This goes to show these Crapexecs have no idea what consumers like. They don't realize that a gatekeeper would totally ruin the experience. Why re-invent the wheel?

[Rot'nApple]

I, personally, never watched NBC's line-up before it was put on iTunes. Once on iTunes, I never made a purchase of their content either. Now that they are gone from iTunes, I don't miss them and I think NBC is finding out that those who did "enjoy"some of NBC's programming, and upset that it was taken out of the iTunes store, they don't miss it either because they never followed it to Hulu or NBCdirect or where ever!

[mrsteveman1]

What NBC wants is completely possible, unlikely to be implemented by apple, and also ridiculous.

The iPhone uses code signing to prevent unsigned apps from running, the same could be done on iPods or iTunes, even for non-drm tracks. You simply insert a cryptographic signature in the ID3 tag of an MP3 or the file metadata for a video, certifying that this specific file is signed by Apple or some other company, and thus the device will play it. DRM isn't required at all, the file will in fact play anywhere, but devices will ONLY play such signed files.

Its ridiculous but technologically possible.

[dagamer34]

A video from Bittorrent has to be converted from DivX/XviD to H.264 most of the time anyway. Really, who are they fooling? Besides, for people that want to watch stuff on their iPods, it takes WAY too long to convert stuff. I'm pretty tech-savvy, but I can't think of an easy program off the top of my head that will download a show, re-name it, auto-convert it, then add it to my iTunes library for free. And that lack of convenience is why iTunes TV shows continue to sell like hotcakes.

[Chris_CA]

Originally Posted by shamino

Now today they're simply repeating that mantra, but with the added lie that loading a legally-purchased DRM-wrapped video clip onto an iPod (an action explicitly permitted by the EULA) somehow constitutes piracy.

Doesn't sound like he's saying that at all.
Most likely he is referring to the comments by Steve Ballmer
http://www.news.com/Ballmer-iPods-pa...3-5395870.html
"The most common format of music on an iPod is stolen."

and by Real Networks CEO Rob Glaser
http://www.reghardware.co.uk/2006/05...len_real_says/
"About half the music on iPods is music obtained illegitimately either from an illegal peer-to-peer networks or from ripping friends' CDs, which is illegal."

[minderbinder]

Originally Posted by mrsteveman1

Its ridiculous but technologically possible.

Sure, it's possible, but it would also block legal content such as legal material released without DRM and the user's own home movies. Obviously, that would be completely unacceptable to everyone.

Originally Posted by dagamer34

A video from Bittorrent has to be converted from DivX/XviD to H.264 most of the time anyway. Really, who are they fooling? Besides, for people that want to watch stuff on their iPods, it takes WAY too long to convert stuff. I'm pretty tech-savvy, but I can't think of an easy program off the top of my head that will download a show, re-name it, auto-convert it, then add it to my iTunes library for free. And that lack of convenience is why iTunes TV shows continue to sell like hotcakes.

There isn't one app that does the whole thing, but it can be done very easily with a couple free or cheap apps. I'm sure people are converting and watching on ipods all the time - they're already taking time to download, what's a bit longer wait for a conversion? And I wouldn't be surprised if as aTV catches on more, people will increasingly pirate things in iPod/aTV compatible formats in the first place.

[backtomac]

Originally Posted by mrjoec123

If you ask me, this is a sure early sign that Hulu isn't working, and NBC wants to come back to iTunes in the worst way. But they're trying to save face by attacking Apple again.

This guy played his hand, and lost big time. Steve called his bluff.

Give it a year, at most. Kliavkoff will be fired, and NBC will be back on iTunes, with none of these draconian measures implemented. There's simply no way Steve will agree to any of it. Not the variable pricing, not the anti-piracy. None of it.

I think they're waiting for the Blockbuster set top box that's going to be the ATV/iTunes killer.

They're going to sell them in their nice new CC stores which will revolutionize retail. An Apple store killer, you know.

The studios are so desperate for an alternative to iTunes and Apple that they really go to unusual lengths to distance themselves.

[shamino]

Originally Posted by minderbinder

Unless I missed it, they're not saying that (correct me if I'm wrong). They're just talking about people pirating movies and shows from torrents and wanting iTunes to somehow block those from iPods and aTV.

Originally Posted by Chris_CA

Doesn't sound like he's saying that at all.
Most likely he is referring to the comments by Steve Ballmer
http://www.news.com/Ballmer-iPods-pa...3-5395870.html
"The most common format of music on an iPod is stolen."

and by Real Networks CEO Rob Glaser
http://www.reghardware.co.uk/2006/05...len_real_says/
"About half the music on iPods is music obtained illegitimately either from an illegal peer-to-peer networks or from ripping friends' CDs, which is illegal."

That is the assumption of the AppleInsider editor.

Over at Ars Technica their editors believe otherwise - that NBC wants total control over where and when you play your purchases, and what ads you must see when viewing them - just like you get from Hulu.

There's absolutely no logic to them wanting Apple to impose measures to block piracy using non-Apple software. That's like saying you'll never fly American Airlines because Continental has a bad policy. The only thing Apple can control is content downloaded from their own servers. Given the fact that Apple has a very good track record of enforcing their DRM, their real complaint must be that they want to impose restrictions beyond what Apple imposes. In other words, they want their content to be as restricted as it is through other services.

Of course, you and I know that if Apple does that, the amount of purchases will immediately drop to be just as low as everybody else's. But movie studios are all about control. Money doesn't matter, no matter what they say. They would gladly flush a billion dollars down the toilet rather than allow a customer to use their own purchases as they want.

[Ronbo]

The statistics people use to prove how iPods are just so full of pirated material has always had a very high BS-quotient. It doesn't take into account the CDs the iPod owners already owned, and later purchased. And it also never took into into account that every time I buy a new iPod, I don't have to buy all my music over again. They like to divide number of tracks sold vs number of iPods sold. So if I buy a second iPod, I've somehow doubled my piracy value in those calculations.

The people who invented these statistics simply did something bogus with math, which seemed to support the argument they were already making... and for some reason, because math was involved, people just happily quoted the results without a lot of rational scrutiny.

[MFago]

Originally Posted by JeffDM

NBC is broadcast "in the clear"

It seems that everyone missed the push to HDMI with HDCP. Pretty soon your DVD player, TV Tuner, Cable Box etc will all talk to your TV via an encrypted signal. All it would take to stop recording broadcasts would for the DMCA to be extended to require all such devices to implement HDCP. I'm sure NBC and others are "lobbying" (aka bribing) congress at this very moment for just this very thing. [according to Wikipedia, the "broadcast flag" was struck down in Congress in 2004, but _is_ required in the EU for HDTV].

I've been holding off on purchasing an HDTV/BluRay player for now so I don't know if every device will actually encrypt the signal via HDCP, but it is certainly possible.

Anyone else have more information?

[bsenka]

Originally Posted by dagamer34

A video from Bittorrent has to be converted from DivX/XviD to H.264 most of the time anyway. Really, who are they fooling? Besides, for people that want to watch stuff on their iPods, it takes WAY too long to convert stuff. I'm pretty tech-savvy, but I can't think of an easy program off the top of my head that will download a show, re-name it, auto-convert it, then add it to my iTunes library for free. And that lack of convenience is why iTunes TV shows continue to sell like hotcakes.

iSquint converts almost any video format to iPod/aTV/h.264 and adds to the iTunes library automatically. It's very easy to use, works very quickly, and it's free.

[aplnub]

We need the smiley that gives "the bird." I would wave it to NBC.