NBC may not renew iTunes contract with Apple - report
NBC Universal, unable to come to an agreement with Apple on pricing, has decided not to renew its contract to sell digital downloads of television shows on iTunes, according to the New York Times.
Citing "a person familiar with the matter," the paper said NBC ? which is the No. 1 supplier of digital video to Apple?s digital download service, accounting for about 40 percent of downloads ? notified Apple of its decision late yesterday.
A spokesman for NBC Universal subsequently confirmed the conglomerate's decision but would not elaborate further. Since the NBC's existing two-year contract with Apple runs through December, its latest decision will not have an immediate impact on the iTunes service. It also leaves the door open for the two forms to reach a new agreement before the current contract expires.
For its part, NBC is seeking more control over the pricing of songs and videos that are sold on iTunes. It also wants better piracy controls and for Apple to allow it to bundle videos to increase revenue.
NBC Universal is the second major iTunes supplier recently to enter into a standoff with Apple over pricing and packaging matters. In July, the Universal Music Group -- the world?s largest music corporation -- said it would not renew its long-term contract with iTunes and would instead market its music at will (allowing it to remove songs from iTunes on short notice).
In its report, the Times suggests that the defiant moves by NBC Universal and Universal Music could embolden other media companies that have been less than thrilled with Apple?s policies.
NBC Universal was the second company to sign an agreement with Apple to sell content on iTunes and has since been talking to the company about offering Universal movies. No deal has been reached, however, because of piracy concerns on the part of NBC.
The existing contract between Apple and NBC Universal stipulates that Apple receive notice of NBC's plans to cancel 90 days before the expiration date, otherwise the deal would automatically renew.
Citing "a person familiar with the matter," the paper said NBC ? which is the No. 1 supplier of digital video to Apple?s digital download service, accounting for about 40 percent of downloads ? notified Apple of its decision late yesterday.
A spokesman for NBC Universal subsequently confirmed the conglomerate's decision but would not elaborate further. Since the NBC's existing two-year contract with Apple runs through December, its latest decision will not have an immediate impact on the iTunes service. It also leaves the door open for the two forms to reach a new agreement before the current contract expires.
For its part, NBC is seeking more control over the pricing of songs and videos that are sold on iTunes. It also wants better piracy controls and for Apple to allow it to bundle videos to increase revenue.
NBC Universal is the second major iTunes supplier recently to enter into a standoff with Apple over pricing and packaging matters. In July, the Universal Music Group -- the world?s largest music corporation -- said it would not renew its long-term contract with iTunes and would instead market its music at will (allowing it to remove songs from iTunes on short notice).
In its report, the Times suggests that the defiant moves by NBC Universal and Universal Music could embolden other media companies that have been less than thrilled with Apple?s policies.
NBC Universal was the second company to sign an agreement with Apple to sell content on iTunes and has since been talking to the company about offering Universal movies. No deal has been reached, however, because of piracy concerns on the part of NBC.
The existing contract between Apple and NBC Universal stipulates that Apple receive notice of NBC's plans to cancel 90 days before the expiration date, otherwise the deal would automatically renew.
Comments
http://news.com.com/8301-10784_3-976...g=2547-1_3-0-5
This is one of the few headlines I've seen that doesn't declare NBC is already pulling content from iTunes. Hard to believe how half-baked cnn and the like are with their stories. To read the coverage on other sites you'd think NBC had already taken everything down from iTunes - or that they will definitely do so soon. Reckless reporting on their part.
Not really, read the article. It clearly states that NBC had to inform Apple before 90 days of the end of the contract if they no longer wanted to continue. Today is 90 days before the contract expires and so one could logicly assume that NMC have written to Apple to inform them that they are not renewing the deal. Anyone who prints a new story saying NBC have cancelled their contract and iTunes will be no longer selling NBC content has just about hit the nail on the head. I am unsure as to how else they could spin this?
NBC would like to offer discounted seasons for purchase on iTunes, and i for one would agree with that. I think the prices iTunes charges for a season of a TV show is far too high, and i would imagine most people would agree. Why should a poorer quality downloaded season cost more than a DVD box-set??? Yet there are many examples of this on iTunes.
* Apple, dont be so greedy, why not have a fair price for a season of a TV Show (especially one that is years old)?
* NBC, dont be so feckin stupid, if we cant buy it from itunes there are plenty of places to download it for free! Is this really what you want?
Sounds to me like the headlines should be "NBC Endorses BitTorrent".
NBC would like to offer discounted seasons for purchase on iTunes,
Apple, dont be so greedy, why not have a fair price for a season of a TV Show (especially one that is years old)?
Actually what the article claims is that NBC wants to sell bundles. These are not cheaper series, but more expensive "deals" where, in order to buy one program/series, you also have to pay for another one or more, which you may well not want.
It's not about Apple being greedy, it's about the networks being as blind as the music industry and not recognising that 20th century business models won't work anymore. Rather than coming up with an innovative way to make money, they are desperately clinging to their anachronistic practices.
* Apple, dont be so greedy, why not have a fair price for a season of a TV Show (especially one that is years old)?
Just playing devil's advocate: because it's available way earlier than the DVD.
NBC needs Apple as much, if not more, than the other way around. It is a close-to-last-place major network that is seeking traction. The parent company GE is watching closely for any missteps. If they dump a major distribution channel that offers it a future growth opportunity, I am sure that Mr. Immelt will have a word or two for NBC's leadership.
That said, I don't see why NBC shouldn't have greater say over bundling or repricing its content. The iTunes store has become an incoherent clutter anyway (compared to its original simplicity and elegance), and it is not clear to me that adding things such as bundling (or even differential pricing) will add much to the mess that it has already become. Just add two extra icons/links to the millions already there: "Bundles" and "Not $1.99." No one will notice.
[email protected]
If you want content to remain on-line include information on age, why you buy content from iTunes, circumstances that cause you to buy content from iTs, why you like the iTunes interface.
I do want NBC Universal to figure out why iTs is the top dog in selling on-line tv content.
NBC needs Apple as much, if not more, than the other way around.
Really?
Is that why they're starting their own service?
http://www.hulu.com/
iPods will sell. NBC and the other studios can get on iTunes and make some money off the iPod train or they can get steamrolled by it.
I wonder if the NBC guys heard of the Sony Connect Store?
iPods will sell. NBC and the other studios can get on iTunes and make some money off the iPod train or they can get steamrolled by it.
The iTMS isn't going to be steamrolling anything without any content to sell.
Just playing devil's advocate: because it's available way earlier than the DVD.
Sorry, but if you read the post you commented on i said "Especially one that is years old"
Really?
Is that why they're starting their own service?
http://www.hulu.com/
No, they're starting their own service because they don't realize how much they need Apple. Tons of companies have started their own competing services, have any been remotely successful. And they'll realize it once their service is running and nobody is using it...and they end up shutting it down before long.
NBC can't win, apple has all the leverage.
Just look at it this way:
1 NBC goes on their own
2 NBC has to tell stockholders that profits are down
3 Stockholders: "Why?"
4 NBC: "iTunes revenues are gone and hulu revenues come nowhere close to replacing that lost revenue"
5 Stockholders tear NBC a new one
6 NBC goes groveling back to apple and signs with itunes again
I don't understand the NBCs position on this. It seems to me that they are negotiating from a position of weakness. I can hear SJ talking to the NBC guys now; "there's this thing called BitTorrent. Have you heard of it?'
iPods will sell. NBC and the other studios can get on iTunes and make some money off the iPod train or they can get steamrolled by it.
Steamrolled by what iPod train? Does a few Disney flicks and episodes of Lost constitute a steam train now?
NBC are not talking from a point of weakness, they own the content that people want to buy. ITunes is the store, if the shelves are empty customers stop coming. I would say NBC are in a position of strengh and it does not take a genius to see how this will pan out. If (and it is looking like a big If) iTunes are to continue selling NBC Programming next year then it will be on NBC's terms.
The iTMS isn't going to be steamrolling anything without any content to sell.
So if ONE network leaves, they won't have ANY content to sell? I guess you missed the tons of other shows available on iTunes? NBC would only make a dent if they got all the other networks to join them and negociate together. Leaving on their own will just increase piracy of their material and decrease the number of people watching their shows.
And NBC has had many of the lowest ranked shows for the last couple years, with a couple exceptions like Heroes, their ratings have been awful. With a lineup as bad as theirs, will people miss them much?
No, they're starting their own service because they don't realize how much they need Apple. Tons of companies have started their own competing services, have any been remotely successful. And they'll realize it once their service is running and nobody is using it...and they end up shutting it down before long.
NBC can't win, apple has all the leverage.
Just look at it this way:
1 NBC goes on their own
2 NBC has to tell stockholders that profits are down
3 Stockholders: "Why?"
4 NBC: "iTunes revenues are gone and hulu revenues come nowhere close to replacing that lost revenue"
5 Stockholders tear NBC a new one
6 NBC goes groveling back to apple and signs with itunes again
NBC are a television broadcasting company, they make the vast majority (if not all) of their profits from advertising revenue, global distribution and sales, licencing and DVD sales. You are talking like they are just a content provider, you are totally clueless on this.
iTunes was just a first step for NBC into the digital distribution market, they realise that illegal downloads are taking their global market away. They are trying other things to rectify this, some are working, for instance there is a big move to start showing US shows overseas almost exactly in line with the US to combat the need for illegal downloads.
But iTunes was just a step, an experiment, NBC still need the advertisers, the move to show all programming free of charge on their own website with advertising is one that all broadcast companies are moving to to keep the advertisers happy.
Like it or not the TV market is moving away from Steve Jobs's vision, for once Apple seem to have backed the wrong horse.
So if ONE network leaves, they won't have ANY content to sell? I guess you missed the tons of other shows available on iTunes? NBC would only make a dent if they got all the other networks to join them and negociate together. Leaving on their own will just increase piracy of their material and decrease the number of people watching their shows.
And NBC has had many of the lowest ranked shows for the last couple years, with a couple exceptions like Heroes, their ratings have been awful. With a lineup as bad as theirs, will people miss them much?
NBC account for 40% of TV content sold through iTunes!!