OK, I need someone to enlighten me as to why I would spend 1.99, let alone 4.99 for an episode of crappy NBC show in the first place.
I've run the math, and it seems to me that even at 1.99/show, if I watch 2 shows per day, that comes out to about 60 bucks per month, and zero flexibility.
My cable with HBO is 60/month including DVR.
Someone want to 'splain the brilliant economics of this model to me?
the ecomonics is the same that persuaded you to get cable with HBO in the first place instead of just relying on free over the air tv. Cable offers something free over the air cannot, same way, digital downloads offers something cable with HBO cannot offer. Your show when you want it on demand!!!. Sure, you could tivo with cable but you can only tivo when the show is airing!!.. example, i love stargate SG1. I have tivo but without digital download, i have to wait until the sci-fi channel rebroadcast Stargate and then, i'd have to hope they broadcasted the episode i was interested in. That's two very big conditions right there.
If there were no value in digital downloads, Itunes would not even take off. Obviously, there is value offered and i hope i just demonstrated the value to you.
Although it looks like it, this is not about money but about the distribution of video, TV shows but especially Movies.
Apple owns the music industry download business and the music moguls hate it but there is nothing that they can do about it.
The TV/movie companies don't want to be in the same position as the music industry and are trying everything possible to weaken Apple.
But at the same time they don't have a clue on how to get the download business organised in a way they keep control over it. They are just messing around.
I know that the whole TV and Movie industry absolutely hate Apple and yes, there will be more to come or better NOT to come (like in no more new movies on iTunes)
All in all Apple has nothing to loose, if there is no more video on iTunes, they just update the software on the iPod and any type of "free" downloaded video can be played... making the iPod even more popular.
aah yes, apple condoning free downloads of video... what cannabis you smoking?. Can i have some so i could be dillusional as you are?.
Cool. I just sent a long and well-thought out email to the NBC address posted in the other thread (and received an email autoreply, so the address is legit) about how $1.99 is the price point where people will buy without even thinking about price but $5 is sheer greed. I detailed my age (26) marital status (single), industry I work in, and how much money I spend on electronics ($4000 on my computer in the past year, $4500 on home theater).
I explained that I won't visit a site that doesn't support Mac users, even with my Windows system (and certainly not if they require IE6 which I don't even have installed). I furthermore went into detail about how users will refuse to pay for streaming content only, or crappy DRM, or content that relies on my trust in some fly-by-night media provider to stay in business, in order for me to continue to view what I paid for.
I also explained that everyone who used to buy their shows will now use BitTorrent, or record on their DVR and skip commercials. I fall into the latter camp, as I find most P2P to be more hassle than it's worth -- especially if the alternative was paying a mere $1.99 for my fix.
Good luck, NBC! Suckers.
Why is $1.99 a good price?.. why not $1.98?.. $2.00. $1.49. $1.399887?.. why $1.99?.. is it cause apple said $1.99?.. did apple do any research that suggested people wouldn't pay more than $1.99 for a song?. Heck, people already pay $600 for their overpriced iphone.. why not more than $1.99?. Obviously, the people who bought an iphone for $600 have lots of disposable income.. i can see NBC viewpoint. Why shouldn't they get the dumb-ass mac zealots money if they willing to spend it?. The only company $1.99 video benefits is apple cause they don't care if they make money from videos..they just want to sell more video ipods.. why should nbc sacrifice profits to sell apple video ipods?. As to people not paying more than $1.99.. they already do.. people rent videos for more than that.. they buy videos for more than that, why not pay $4.99 for a video espicially when you don't have to gas up the car and take a trip to the video store?. Also if NBC does it themselves, you can bet it would be better quality than the crap itunes is pushing out. Yeah, NBC was right.. the $1.99 only benefits Apple, they lose in this equation. Well, lets see apple sell video ipods with dramatically reduced videos available for it (NBC accounted for 30% of videos sold via itunes).
As to people not paying more than $1.99.. they already do.. people rent videos for more than that.. they buy videos for more than that, why not pay $4.99 for a video espicially when you don't have to gas up the car and take a trip to the video store?
The DVD you rent would generally be two hours or more, whereas the $1.99 is only 22 to 45 minutes. I can rent from Netflix for an average of about $1 a disc.
Most DVD sets that I buy offer the entire series for less than that per episode.
The DVD you rent would generally be two hours or more, whereas the $1.99 is only 22 to 45 minutes. I can rent from Netflix for an average of about $1 a disc.
Most DVD sets that I buy offer the entire series for less than that per episode.
hmm, that's the point!!!.. NBC wanted to bundle videos for sale, in addition to increasing prices for certain videos. When you go to the video store, does all video cost the same?. has that ever prevented you from buying the video you wanted to view?. for me it hasn't. If i want to see something, i want to see it!. The video rental place also has video rentals at different prices. Blockbuster seems to be just ok with this variable pricing model. Maybe NBC should make a deal to sell it's stuff through blockbuster.com.
Why is $1.99 a good price?.. why not $1.98?.. $2.00. $1.49. $1.399887?.. why $1.99?.. is it cause apple said $1.99?.. did apple do any research that suggested people wouldn't pay more than $1.99 for a song?. Heck, people already pay $600 for their overpriced iphone.. why not more than $1.99?. Obviously, the people who bought an iphone for $600 have lots of disposable income.. i can see NBC viewpoint. Why shouldn't they get the dumb-ass mac zealots money if they willing to spend it?. The only company $1.99 video benefits is apple cause they don't care if they make money from videos..they just want to sell more video ipods.. why should nbc sacrifice profits to sell apple video ipods?. As to people not paying more than $1.99.. they already do.. people rent videos for more than that.. they buy videos for more than that, why not pay $4.99 for a video espicially when you don't have to gas up the car and take a trip to the video store?. Also if NBC does it themselves, you can bet it would be better quality than the crap itunes is pushing out. Yeah, NBC was right.. the $1.99 only benefits Apple, they lose in this equation. Well, lets see apple sell video ipods with dramatically reduced videos available for it (NBC accounted for 30% of videos sold via itunes).
Describing the people who buy media at the iTMS store as "dumb ass Mac zealots" suggests that you're just kinda full of shit, and whatever vehemence you are bringing to this argument is based on more than the just the relative value propositions.
Describing the people who buy media at the iTMS store as "dumb ass Mac zealots" suggests that you're just kinda full of shit, and whatever vehemence you are bringing to this argument is based on more than the just the relative value propositions.
I'm sorry.. you are all extremely intelligent for buying an $600 overpriced iphone whose only revolutionary feature is that it was made by apple.
Sounds better?. NBC still wants more of your money, since you seem to have a lot of it to spend. Actually, i can't believe you want to buy videos on the cheap. I mean, you think paying a lot means getting better quality, you should be jumping all over to pay more for NBC shows. When snooty windows people come up to you and talk about their ugly cheap players, you can haughtily say.. "your player sucks and is cheap.. i paid a ton of money for mine and also paid a ton of money for the video on it, hence it is a better quality video player with superior video content".
BTW, a disclaimer. I've never bought music from itunes, never will buy crappy videos from itunes (and i have an ipod and also a mac computer) so i am being devils advocate here.. but I do believe NBC has the right to offer their content as they see fit. I've never heard a distributor telling a supplier what to charge for their products. If u have, please give me an example (other than wal-mart).
I'm sorry.. you are all extremely intelligent for buying an $600 overpriced iphone whose only revolutionary feature is that it was made by apple.
Sounds better?. NBC still wants more of your money, since you seem to have a lot of it to spend. Actually, i can't believe you want to buy videos on the cheap. I mean, you think paying a lot means getting better quality, you should be jumping all over to pay more for NBC shows. When snooty windows people come up to you and talk about their ugly cheap players, you can haughtily say.. "your player sucks and is cheap.. i paid a ton of money for mine and also paid a ton of money for the video on it, hence it is a better quality video player with superior video content".
It'll show those window snobs.
My point exactly. You are obviously inspired by some kind of animosity for whatever you imagine the motivations of Apple's customers are.
Which is fine, and your prerogative, but probably not the basis of a reasonable analysis of the situation.
BTW, a disclaimer. I've never bought music from itunes, never will buy crappy videos from itunes (and i have an ipod and also a mac computer) so i am being devils advocate here.. but I do believe NBC has the right to offer their content as they see fit. I've never heard a distributor telling a supplier what to charge for their products. If u have, please give me an example (other than wal-mart).
Your rhetoric goes a little beyond "playing the devil's advocate" into "Apple people teh suxxor".
If you could leave out the gratuitous jabs at Apple's customers, arguments about NBC's behavior would seem more persuasive.
hmm, that's the point!!!.. NBC wanted to bundle videos for sale, in addition to increasing prices for certain videos. When you go to the video store, does all video cost the same?. has that ever prevented you from buying the video you wanted to view?. for me it hasn't. If i want to see something, i want to see it!. The video rental place also has video rentals at different prices. Blockbuster seems to be just ok with this variable pricing model. Maybe NBC should make a deal to sell it's stuff through blockbuster.com.
Last I saw, Blockbuster does have fairly fixed rental price schedules though, a certain price for videos less than a year from release, and a lower price for older videos.
At retail, you are right, movies and TV shows are sold at several different price points, though the TV shows are almost always in complete sets, not a la carte.
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\tBTW, a disclaimer. I've never bought music from itunes, never will buy crappy videos from itunes (and i have an ipod and also a mac computer) so i am being devils advocate here.. but I do believe NBC has the right to offer their content as they see fit. I've never heard a distributor telling a supplier what to charge for their products. If u have, please give me an example (other than wal-mart).
Wal-Mart might very well be the most applicable example, because they are both the biggest fish in their respective home domains. Wal-Mart has the dominant position in physical media sales, something like 20% or more, depending on the media, I think 30% on CDs. Apple has the dominant position in downloaded media sales, at a much greater fraction, I think I've seen around 80%. I think it's easy to see why the media companies don't like this situation. I go legit for all my music and movies, but that doesn't mean I'm necessarily sympathetic to what I see as an oligarchy of content producers.
At any rate, this is a private contract dispute that the parties have decided to take public, without really providing adequate specifics. I find that unnerving because there is so little information, and spoon fed, and what little information given is spun and twisted that I fear all these opinions on the issue are completely off base. Basically, a PR game used for negotiation, playing public opinion without risking a breakdown in discussions.
My point exactly. You are obviously inspired by some kind of animosity for whatever you imagine the motivations of Apple's customers are.
Which is fine, and your prerogative, but probably not the basis of a reasonable analysis of the situation.
You realize i was being sarcastic right?. What basis do you have for a reasonable analysis of the situation?. Give me one example (a link to a post would be good) where you thought apple was in the wrong?. Exactly how could your analysis be reasonable if apple is always right?. If you can supply such a link to some post you made in the past where you were being reasonable, i will be a man and admit i was wrong (when i am wrong, i have no problem admitting it).
.. but I do believe NBC has the right to offer their content as they see fit. I've never heard a distributor telling a supplier what to charge for their products. If u have, please give me an example (other than wal-mart).
Your right they do have the right to charge what they see fit, and Apple has the right to set the retail price that they will sell products for. As for the current spat between the two I would bet that there is a lot more to the story than has been released, such as a higher price built in for HD versions of the video.
You ask for an example of a retailer demanding price the price point but want one other than Wall-Mart but that is unrealistic. For the most part retailers don't have the power over the suppliers to demand a lower price, though manufacturers regularly do have that power to demand a lower price from their suppliers. Wall-Mart has changed the face of retail sales because they do have the power to demand the lower price due to their dominance in almost every market, and so they are a great example of the retailer setting the price. However, retailers regularly have "Store Brand" products which do put a downward pressure on the larger manufacturers to lower prices and those retailers do set the prices for those products. For an example of this look at any grocery chain, Best Buy, Circuit City, Sears, Lowes, Home Depot, etc, etc...
That aside, retailers regularly set the price of what they sell. They sometimes put sales prices for some products at lower than retail for some products to get people into the store so that they buy other products that are more profitable, so their net profit is larger than the loss of the single product that they sold at a loss. Auto parts stores use to do this on a regular basis with motor oil, and made the money back on filters and other parts. I imagine that they still do this, though I am not currently selling auto parts to say from first hand experience. Sure there are some manufacturers that don't allow this, but Apple is the only one that comes to mind.
Last I saw, Blockbuster does have fairly fixed rental price schedules though, a certain price for videos less than a year from release, and a lower price for older videos.
At retail, you are right, movies and TV shows are sold at several different price points, though the TV shows are almost always in complete sets, not a la carte.
Wal-Mart might very well be the most applicable example, because they are both the biggest fish in their respective home domains. Wal-Mart has the dominant position in physical media sales, something like 20% or more, depending on the media, I think 30% on CDs. Apple has the dominant position in downloaded media sales, at a much greater fraction, I think I've seen around 80%. I think it's easy to see why the media companies don't like this situation. I go legit for all my music and movies, but that doesn't mean I'm necessarily sympathetic to what I see as an oligarchy of content producers.
At any rate, this is a private contract dispute that the parties have decided to take public, without really providing adequate specifics.
BTW, i would argue just as passionately against walmart practices. There are many people who are against wal-mart practices so i would not rush to compare apple with walmart.
As to private dispute.. i agree but apple took it public for the exact reasons you see in this forum.. to paint NBC as greedy. Maybe NBC should point out that if apple sold their ipods for less price, people would have more money to buy videos at 4.99 a pop. I think it's hypocritical of apple to point out how greedy NBC is while claiming the right to charge a premium for their name brand. NBC could make the same argument.. saying that their shows are superior to others and should be bought at a premium (and then apple should let the market decide if that is true or not). How nice of apple to look out for me.. If they really want to look out for me, drop the price of their ipods and their laptops.. i'd really appreciate that rather than this trumped up sympathy campaign apple is engaging in.
You realize i was being sarcastic right?. What basis do you have for a reasonable analysis of the situation?. Give me one example (a link to a post would be good) where you thought apple was in the wrong?. Exactly how could your analysis be reasonable if apple is always right?. If you can supply such a link to some post you made in the past where you were being reasonable, i will be a man and admit i was wrong (when i am wrong, i have no problem admitting it).
Otherwise, i am just as reasonable as you are.
I've gone on at length about how shitty I think the new dock in Leopard is, how terrible the Apple TV stuff looked in the stores at roll-out, and what a disaster I feel iMovie '08 to be, just to pick a couple of recent examples.
I'm not sure why you would assume I'm some kind of Apple apologist, or how you think that has any bearing on anything.
Your rhetoric goes a little beyond "playing the devil's advocate" into "Apple people teh suxxor".
If you could leave out the gratuitous jabs at Apple's customers, arguments about NBC's behavior would seem more persuasive.
Oh come on.. people have been attacking NBC left and right and trumpeting how virtuous apple is. I'm not even saying apple is bad. I'm just saying they are not in the right and you know what?.. apple fans need to be told sometimes that they are full of shit. Why should i sugarcoat it?.
Think about it.. how can $1.99 videos favor NBC?.. people say that NBC makes more money at $1.99 but these people are not economists.
Here is an article from wikipedia discussing price points
Actually, NBC is right. there is no way on earth the price point of a old video is the same as a new and hot video so apple is incorrect in thinking all videos are worth $1.99, but apple is framing the argument in a way to galvanize their fans. Greedy NBC wants your money!!!.. while ignoring the fact that their pricing strategy flies in the face of economics.
think of gas.. gas prices rise but people still buy gas.. while some of that behavior is due to the fact people have to actually travel.. they don't curtail their travel. In the last year, more people than ever is driving and flying and taking the trains. This is an example of where lowering the price does not equal greater demand. So if Exxon were to lower the price of gas, they would lose money unnecessarily.. that is why there is a science of price points. Ie., the price you can raise something to and increase revenue. I can assure you that even if NBC were to lose some people by raising the prices of their video (you perhaps), they would more than make up for it in extra revenue (if they did their studies right and have identified the correct price point). Even if they haven't, apple does not want them to discover the price point. By keeping videos at $1.99, NBC will never know what the best price point is. I'm sure that is what they are thinking. I'm sure if revenue decrease more than offset additional revenue, they would adjust their prices.
So NBC is right.. the only entity a $1.99/video helps is apple. That helps them sell their ipods cause they are selling NBC product at an artificial low price. How do i know it's low?.. cause they are selling old episodes for $1.99, same as new episodes.. either apple is robbing the consumers (cause there is no way in hell an old episode is worth as much as a new one.. or even an episode from a less popular show worth as much as one from a very popular show) or they are taking revenue from NBC.. ie, NBC is subsidizing the sales of Video Ipods.
Was this the kind of argument you wanted to see?.
(i'm sure a few mac fans knew this but why would they point this out?.. apple is great, everyone else is greedy).
BTW, i would argue just as passionately against walmart practices. There are many people who are against wal-mart practices so i would not rush to compare apple with walmart.
Oh well. In this case, I really don't see anything wrong with the comparison, even though Wal-Mart's practices may be worse, Apple's still in the same vein with regard to pressuring suppliers.
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As to private dispute.. i agree but apple took it public for the exact reasons you see in this forum.. to paint NBC as greedy.
I don't know, it could be, but that's hard to say for sure. It looks to me that the Apple PR release was in response to the NYT story. Whether someone at Apple or NBC leaked the bits to NYT, I am not sure, it could be either.
Oh come on.. people have been attacking NBC left and right and trumpeting how virtuous apple is. I'm not even saying apple is bad. I'm just saying they are not in the right and you know what?.. apple fans need to be told sometimes that they are full of shit. Why should i sugarcoat it?.
Think about it.. how can $1.99 videos favor NBC?.. people say that NBC makes more money at $1.99 but these people are not economists.
Here is an article from wikipedia discussing price points
Actually, NBC is right. there is no way on earth the price point of a old video is the same as a new and hot video so apple is incorrect in thinking all videos are worth $1.99, but apple is framing the argument in a way to galvanize their fans. Greedy NBC wants your money!!!.. while ignoring the fact that their pricing strategy flies in the face of economics.
think of gas.. gas prices rise but people still buy gas.. while some of that behavior is due to the fact people have to actually travel.. they don't curtail their travel. In the last year, more people than ever is driving and flying and taking the trains. This is an example of where lowering the price does not equal greater demand. So if Exxon were to lower the price of gas, they would lose money unnecessarily.. that is why there is a science of price points. Ie., the price you can raise something to and increase revenue. I can assure you that even if NBC were to lose some people by raising the prices of their video (you perhaps), they would more than make up for it in extra revenue (if they did their studies right and have identified the correct price point). Even if they haven't, apple does not want them to discover the price point. By keeping videos at $1.99, NBC will never know what the best price point is. I'm sure that is what they are thinking. I'm sure if revenue decrease more than offset additional revenue, they would adjust their prices.
So NBC is right.. the only entity a $1.99/video helps is apple. That helps them sell their ipods cause they are selling NBC product at an artificial low price. How do i know it's low?.. cause they are selling old episodes for $1.99, same as new episodes.. either apple is robbing the consumers (cause there is no way in hell an old episode is worth as much as a new one.. or even an episode from a less popular show worth as much as one from a very popular show) or they are taking revenue from NBC.. ie, NBC is subsidizing the sales of Video Ipods.
Was this the kind of argument you wanted to see?.
(i'm sure a few mac fans knew this but why would they point this out?.. apple is great, everyone else is greedy).
Fine, sure, but you seem to have a pretty relentlessly negative attitude towards pretty much everything Apple does. Is it really that rewarding to be the guy that tells Apple enthusiasts that they are full of shit, over and over again, on an Apple enthusiast discussion board?
I mean, knock yourself out and all, I'm just sayin.
Oh come on.. people have been attacking NBC left and right and trumpeting how virtuous apple is. I'm not even saying apple is bad. I'm just saying they are not in the right and you know what?.. apple fans need to be told sometimes that they are full of shit. Why should i sugarcoat it?.
Think about it.. how can $1.99 videos favor NBC?.. people say that NBC makes more money at $1.99 but these people are not economists.
Here is an article from wikipedia discussing price points...
Some Math:
Heroes Season 1, HD DVD, MSRP $99.98 or $4.35/show, Amazon price $69.95 or $3.04/show
Heroes Season 1, SD DVD MSRP $59.98 or $2.60/show, Amazon price $39.99 or $1.74/show
Heroes Season 1 Pass, SD iTMS $42.99 or $1.87/show
Given these prices and the lower cost of manufacturing the download file, minus the "special features" , shipping, and advertising Apple's retail price for the downloaded file is a pretty good deal for NBC for the SD version which is actually selling for more per episode than the DVD with less extras and no physical media or shipping costs based on a real world price from Amazon. Given these figures a "reasonable" price based off of real world examples would put the SD version at the same that it is currently getting at iTMS or moving it up to a HD format would give us about $72.91 for a season pass or $3.17 a show. Now iTMS gives the consumer an earlier outlet for the purchase than a DVD does, but at a lower cost to manufacture and advertise than the DVD does and with fewer features to the consumer. A price increase should be expected if there is going to be a move to HD, but a good value for the consumer would place it at $2.99 or $3.49 an episode as a final cost.
I would imagine that there is a lot of posturing on both sides of this to get what they want, and there might be more to this than just the sales. Apple would probably like to have access to the Hula service, and NBC would probably like access to AppleTV as a quantifiable ad revenue based "on demand" stream for new shows to offset ad revenue lost to DVR timeshifiting, and put off releasing a retail version until after the season is complete. There is most likely more to the story than that as well, including both companies trying to get the upper hand in the deal. I wouldn't say that either company is an Angel here, hopefully the consumer will come out ahead.
One thing to remember with Apple is that they historically prefer single price schemes for their products, even though that may hurt them at times.
Comments
The press release referenced in this story can be found here:
http://www.apple.com/pr/library/2007/08/31itunes.html
Even some of the bad bloggers provide links to other sites that they get their information from.
OK, I need someone to enlighten me as to why I would spend 1.99, let alone 4.99 for an episode of crappy NBC show in the first place.
I've run the math, and it seems to me that even at 1.99/show, if I watch 2 shows per day, that comes out to about 60 bucks per month, and zero flexibility.
My cable with HBO is 60/month including DVR.
Someone want to 'splain the brilliant economics of this model to me?
the ecomonics is the same that persuaded you to get cable with HBO in the first place instead of just relying on free over the air tv. Cable offers something free over the air cannot, same way, digital downloads offers something cable with HBO cannot offer. Your show when you want it on demand!!!. Sure, you could tivo with cable but you can only tivo when the show is airing!!.. example, i love stargate SG1. I have tivo but without digital download, i have to wait until the sci-fi channel rebroadcast Stargate and then, i'd have to hope they broadcasted the episode i was interested in. That's two very big conditions right there.
If there were no value in digital downloads, Itunes would not even take off. Obviously, there is value offered and i hope i just demonstrated the value to you.
Although it looks like it, this is not about money but about the distribution of video, TV shows but especially Movies.
Apple owns the music industry download business and the music moguls hate it but there is nothing that they can do about it.
The TV/movie companies don't want to be in the same position as the music industry and are trying everything possible to weaken Apple.
But at the same time they don't have a clue on how to get the download business organised in a way they keep control over it. They are just messing around.
I know that the whole TV and Movie industry absolutely hate Apple and yes, there will be more to come or better NOT to come (like in no more new movies on iTunes)
All in all Apple has nothing to loose, if there is no more video on iTunes, they just update the software on the iPod and any type of "free" downloaded video can be played... making the iPod even more popular.
aah yes, apple condoning free downloads of video... what cannabis you smoking?. Can i have some so i could be dillusional as you are?.
Cool. I just sent a long and well-thought out email to the NBC address posted in the other thread (and received an email autoreply, so the address is legit) about how $1.99 is the price point where people will buy without even thinking about price but $5 is sheer greed. I detailed my age (26) marital status (single), industry I work in, and how much money I spend on electronics ($4000 on my computer in the past year, $4500 on home theater).
I explained that I won't visit a site that doesn't support Mac users, even with my Windows system (and certainly not if they require IE6 which I don't even have installed). I furthermore went into detail about how users will refuse to pay for streaming content only, or crappy DRM, or content that relies on my trust in some fly-by-night media provider to stay in business, in order for me to continue to view what I paid for.
I also explained that everyone who used to buy their shows will now use BitTorrent, or record on their DVR and skip commercials. I fall into the latter camp, as I find most P2P to be more hassle than it's worth -- especially if the alternative was paying a mere $1.99 for my fix.
Good luck, NBC! Suckers.
Why is $1.99 a good price?.. why not $1.98?.. $2.00. $1.49. $1.399887?.. why $1.99?.. is it cause apple said $1.99?.. did apple do any research that suggested people wouldn't pay more than $1.99 for a song?. Heck, people already pay $600 for their overpriced iphone.. why not more than $1.99?. Obviously, the people who bought an iphone for $600 have lots of disposable income.. i can see NBC viewpoint. Why shouldn't they get the dumb-ass mac zealots money if they willing to spend it?. The only company $1.99 video benefits is apple cause they don't care if they make money from videos..they just want to sell more video ipods.. why should nbc sacrifice profits to sell apple video ipods?. As to people not paying more than $1.99.. they already do.. people rent videos for more than that.. they buy videos for more than that, why not pay $4.99 for a video espicially when you don't have to gas up the car and take a trip to the video store?. Also if NBC does it themselves, you can bet it would be better quality than the crap itunes is pushing out. Yeah, NBC was right.. the $1.99 only benefits Apple, they lose in this equation. Well, lets see apple sell video ipods with dramatically reduced videos available for it (NBC accounted for 30% of videos sold via itunes).
As to people not paying more than $1.99.. they already do.. people rent videos for more than that.. they buy videos for more than that, why not pay $4.99 for a video espicially when you don't have to gas up the car and take a trip to the video store?
The DVD you rent would generally be two hours or more, whereas the $1.99 is only 22 to 45 minutes. I can rent from Netflix for an average of about $1 a disc.
Most DVD sets that I buy offer the entire series for less than that per episode.
The DVD you rent would generally be two hours or more, whereas the $1.99 is only 22 to 45 minutes. I can rent from Netflix for an average of about $1 a disc.
Most DVD sets that I buy offer the entire series for less than that per episode.
hmm, that's the point!!!.. NBC wanted to bundle videos for sale, in addition to increasing prices for certain videos. When you go to the video store, does all video cost the same?. has that ever prevented you from buying the video you wanted to view?. for me it hasn't. If i want to see something, i want to see it!. The video rental place also has video rentals at different prices. Blockbuster seems to be just ok with this variable pricing model. Maybe NBC should make a deal to sell it's stuff through blockbuster.com.
Why is $1.99 a good price?.. why not $1.98?.. $2.00. $1.49. $1.399887?.. why $1.99?.. is it cause apple said $1.99?.. did apple do any research that suggested people wouldn't pay more than $1.99 for a song?. Heck, people already pay $600 for their overpriced iphone.. why not more than $1.99?. Obviously, the people who bought an iphone for $600 have lots of disposable income.. i can see NBC viewpoint. Why shouldn't they get the dumb-ass mac zealots money if they willing to spend it?. The only company $1.99 video benefits is apple cause they don't care if they make money from videos..they just want to sell more video ipods.. why should nbc sacrifice profits to sell apple video ipods?. As to people not paying more than $1.99.. they already do.. people rent videos for more than that.. they buy videos for more than that, why not pay $4.99 for a video espicially when you don't have to gas up the car and take a trip to the video store?. Also if NBC does it themselves, you can bet it would be better quality than the crap itunes is pushing out. Yeah, NBC was right.. the $1.99 only benefits Apple, they lose in this equation. Well, lets see apple sell video ipods with dramatically reduced videos available for it (NBC accounted for 30% of videos sold via itunes).
Describing the people who buy media at the iTMS store as "dumb ass Mac zealots" suggests that you're just kinda full of shit, and whatever vehemence you are bringing to this argument is based on more than the just the relative value propositions.
Describing the people who buy media at the iTMS store as "dumb ass Mac zealots" suggests that you're just kinda full of shit, and whatever vehemence you are bringing to this argument is based on more than the just the relative value propositions.
I'm sorry.. you are all extremely intelligent for buying an $600 overpriced iphone whose only revolutionary feature is that it was made by apple.
Sounds better?. NBC still wants more of your money, since you seem to have a lot of it to spend. Actually, i can't believe you want to buy videos on the cheap. I mean, you think paying a lot means getting better quality, you should be jumping all over to pay more for NBC shows. When snooty windows people come up to you and talk about their ugly cheap players, you can haughtily say.. "your player sucks and is cheap.. i paid a ton of money for mine and also paid a ton of money for the video on it, hence it is a better quality video player with superior video content".
It'll show those window snobs.
I'm sorry.. you are all extremely intelligent for buying an $600 overpriced iphone whose only revolutionary feature is that it was made by apple.
Sounds better?. NBC still wants more of your money, since you seem to have a lot of it to spend. Actually, i can't believe you want to buy videos on the cheap. I mean, you think paying a lot means getting better quality, you should be jumping all over to pay more for NBC shows. When snooty windows people come up to you and talk about their ugly cheap players, you can haughtily say.. "your player sucks and is cheap.. i paid a ton of money for mine and also paid a ton of money for the video on it, hence it is a better quality video player with superior video content".
It'll show those window snobs.
My point exactly. You are obviously inspired by some kind of animosity for whatever you imagine the motivations of Apple's customers are.
Which is fine, and your prerogative, but probably not the basis of a reasonable analysis of the situation.
BTW, a disclaimer. I've never bought music from itunes, never will buy crappy videos from itunes (and i have an ipod and also a mac computer) so i am being devils advocate here.. but I do believe NBC has the right to offer their content as they see fit. I've never heard a distributor telling a supplier what to charge for their products. If u have, please give me an example (other than wal-mart).
Your rhetoric goes a little beyond "playing the devil's advocate" into "Apple people teh suxxor".
If you could leave out the gratuitous jabs at Apple's customers, arguments about NBC's behavior would seem more persuasive.
hmm, that's the point!!!.. NBC wanted to bundle videos for sale, in addition to increasing prices for certain videos. When you go to the video store, does all video cost the same?. has that ever prevented you from buying the video you wanted to view?. for me it hasn't. If i want to see something, i want to see it!. The video rental place also has video rentals at different prices. Blockbuster seems to be just ok with this variable pricing model. Maybe NBC should make a deal to sell it's stuff through blockbuster.com.
Last I saw, Blockbuster does have fairly fixed rental price schedules though, a certain price for videos less than a year from release, and a lower price for older videos.
At retail, you are right, movies and TV shows are sold at several different price points, though the TV shows are almost always in complete sets, not a la carte.
\tBTW, a disclaimer. I've never bought music from itunes, never will buy crappy videos from itunes (and i have an ipod and also a mac computer) so i am being devils advocate here.. but I do believe NBC has the right to offer their content as they see fit. I've never heard a distributor telling a supplier what to charge for their products. If u have, please give me an example (other than wal-mart).
Wal-Mart might very well be the most applicable example, because they are both the biggest fish in their respective home domains. Wal-Mart has the dominant position in physical media sales, something like 20% or more, depending on the media, I think 30% on CDs. Apple has the dominant position in downloaded media sales, at a much greater fraction, I think I've seen around 80%. I think it's easy to see why the media companies don't like this situation. I go legit for all my music and movies, but that doesn't mean I'm necessarily sympathetic to what I see as an oligarchy of content producers.
At any rate, this is a private contract dispute that the parties have decided to take public, without really providing adequate specifics. I find that unnerving because there is so little information, and spoon fed, and what little information given is spun and twisted that I fear all these opinions on the issue are completely off base. Basically, a PR game used for negotiation, playing public opinion without risking a breakdown in discussions.
My point exactly. You are obviously inspired by some kind of animosity for whatever you imagine the motivations of Apple's customers are.
Which is fine, and your prerogative, but probably not the basis of a reasonable analysis of the situation.
You realize i was being sarcastic right?. What basis do you have for a reasonable analysis of the situation?. Give me one example (a link to a post would be good) where you thought apple was in the wrong?. Exactly how could your analysis be reasonable if apple is always right?. If you can supply such a link to some post you made in the past where you were being reasonable, i will be a man and admit i was wrong (when i am wrong, i have no problem admitting it).
Otherwise, i am just as reasonable as you are.
.. but I do believe NBC has the right to offer their content as they see fit. I've never heard a distributor telling a supplier what to charge for their products. If u have, please give me an example (other than wal-mart).
Your right they do have the right to charge what they see fit, and Apple has the right to set the retail price that they will sell products for. As for the current spat between the two I would bet that there is a lot more to the story than has been released, such as a higher price built in for HD versions of the video.
You ask for an example of a retailer demanding price the price point but want one other than Wall-Mart but that is unrealistic. For the most part retailers don't have the power over the suppliers to demand a lower price, though manufacturers regularly do have that power to demand a lower price from their suppliers. Wall-Mart has changed the face of retail sales because they do have the power to demand the lower price due to their dominance in almost every market, and so they are a great example of the retailer setting the price. However, retailers regularly have "Store Brand" products which do put a downward pressure on the larger manufacturers to lower prices and those retailers do set the prices for those products. For an example of this look at any grocery chain, Best Buy, Circuit City, Sears, Lowes, Home Depot, etc, etc...
That aside, retailers regularly set the price of what they sell. They sometimes put sales prices for some products at lower than retail for some products to get people into the store so that they buy other products that are more profitable, so their net profit is larger than the loss of the single product that they sold at a loss. Auto parts stores use to do this on a regular basis with motor oil, and made the money back on filters and other parts. I imagine that they still do this, though I am not currently selling auto parts to say from first hand experience. Sure there are some manufacturers that don't allow this, but Apple is the only one that comes to mind.
Last I saw, Blockbuster does have fairly fixed rental price schedules though, a certain price for videos less than a year from release, and a lower price for older videos.
At retail, you are right, movies and TV shows are sold at several different price points, though the TV shows are almost always in complete sets, not a la carte.
Wal-Mart might very well be the most applicable example, because they are both the biggest fish in their respective home domains. Wal-Mart has the dominant position in physical media sales, something like 20% or more, depending on the media, I think 30% on CDs. Apple has the dominant position in downloaded media sales, at a much greater fraction, I think I've seen around 80%. I think it's easy to see why the media companies don't like this situation. I go legit for all my music and movies, but that doesn't mean I'm necessarily sympathetic to what I see as an oligarchy of content producers.
At any rate, this is a private contract dispute that the parties have decided to take public, without really providing adequate specifics.
BTW, i would argue just as passionately against walmart practices. There are many people who are against wal-mart practices so i would not rush to compare apple with walmart.
As to private dispute.. i agree but apple took it public for the exact reasons you see in this forum.. to paint NBC as greedy. Maybe NBC should point out that if apple sold their ipods for less price, people would have more money to buy videos at 4.99 a pop. I think it's hypocritical of apple to point out how greedy NBC is while claiming the right to charge a premium for their name brand. NBC could make the same argument.. saying that their shows are superior to others and should be bought at a premium (and then apple should let the market decide if that is true or not). How nice of apple to look out for me.. If they really want to look out for me, drop the price of their ipods and their laptops.. i'd really appreciate that rather than this trumped up sympathy campaign apple is engaging in.
You realize i was being sarcastic right?. What basis do you have for a reasonable analysis of the situation?. Give me one example (a link to a post would be good) where you thought apple was in the wrong?. Exactly how could your analysis be reasonable if apple is always right?. If you can supply such a link to some post you made in the past where you were being reasonable, i will be a man and admit i was wrong (when i am wrong, i have no problem admitting it).
Otherwise, i am just as reasonable as you are.
I've gone on at length about how shitty I think the new dock in Leopard is, how terrible the Apple TV stuff looked in the stores at roll-out, and what a disaster I feel iMovie '08 to be, just to pick a couple of recent examples.
I'm not sure why you would assume I'm some kind of Apple apologist, or how you think that has any bearing on anything.
Your rhetoric goes a little beyond "playing the devil's advocate" into "Apple people teh suxxor".
If you could leave out the gratuitous jabs at Apple's customers, arguments about NBC's behavior would seem more persuasive.
Oh come on.. people have been attacking NBC left and right and trumpeting how virtuous apple is. I'm not even saying apple is bad. I'm just saying they are not in the right and you know what?.. apple fans need to be told sometimes that they are full of shit. Why should i sugarcoat it?.
Think about it.. how can $1.99 videos favor NBC?.. people say that NBC makes more money at $1.99 but these people are not economists.
Here is an article from wikipedia discussing price points
http://en.wikipedia.org/wiki/Price_point
Actually, NBC is right. there is no way on earth the price point of a old video is the same as a new and hot video so apple is incorrect in thinking all videos are worth $1.99, but apple is framing the argument in a way to galvanize their fans. Greedy NBC wants your money!!!.. while ignoring the fact that their pricing strategy flies in the face of economics.
think of gas.. gas prices rise but people still buy gas.. while some of that behavior is due to the fact people have to actually travel.. they don't curtail their travel. In the last year, more people than ever is driving and flying and taking the trains. This is an example of where lowering the price does not equal greater demand. So if Exxon were to lower the price of gas, they would lose money unnecessarily.. that is why there is a science of price points. Ie., the price you can raise something to and increase revenue. I can assure you that even if NBC were to lose some people by raising the prices of their video (you perhaps), they would more than make up for it in extra revenue (if they did their studies right and have identified the correct price point). Even if they haven't, apple does not want them to discover the price point. By keeping videos at $1.99, NBC will never know what the best price point is. I'm sure that is what they are thinking. I'm sure if revenue decrease more than offset additional revenue, they would adjust their prices.
So NBC is right.. the only entity a $1.99/video helps is apple. That helps them sell their ipods cause they are selling NBC product at an artificial low price. How do i know it's low?.. cause they are selling old episodes for $1.99, same as new episodes.. either apple is robbing the consumers (cause there is no way in hell an old episode is worth as much as a new one.. or even an episode from a less popular show worth as much as one from a very popular show) or they are taking revenue from NBC.. ie, NBC is subsidizing the sales of Video Ipods.
Was this the kind of argument you wanted to see?.
(i'm sure a few mac fans knew this but why would they point this out?.. apple is great, everyone else is greedy).
BTW, i would argue just as passionately against walmart practices. There are many people who are against wal-mart practices so i would not rush to compare apple with walmart.
Oh well. In this case, I really don't see anything wrong with the comparison, even though Wal-Mart's practices may be worse, Apple's still in the same vein with regard to pressuring suppliers.
As to private dispute.. i agree but apple took it public for the exact reasons you see in this forum.. to paint NBC as greedy.
I don't know, it could be, but that's hard to say for sure. It looks to me that the Apple PR release was in response to the NYT story. Whether someone at Apple or NBC leaked the bits to NYT, I am not sure, it could be either.
Oh come on.. people have been attacking NBC left and right and trumpeting how virtuous apple is. I'm not even saying apple is bad. I'm just saying they are not in the right and you know what?.. apple fans need to be told sometimes that they are full of shit. Why should i sugarcoat it?.
Think about it.. how can $1.99 videos favor NBC?.. people say that NBC makes more money at $1.99 but these people are not economists.
Here is an article from wikipedia discussing price points
http://en.wikipedia.org/wiki/Price_point
Actually, NBC is right. there is no way on earth the price point of a old video is the same as a new and hot video so apple is incorrect in thinking all videos are worth $1.99, but apple is framing the argument in a way to galvanize their fans. Greedy NBC wants your money!!!.. while ignoring the fact that their pricing strategy flies in the face of economics.
think of gas.. gas prices rise but people still buy gas.. while some of that behavior is due to the fact people have to actually travel.. they don't curtail their travel. In the last year, more people than ever is driving and flying and taking the trains. This is an example of where lowering the price does not equal greater demand. So if Exxon were to lower the price of gas, they would lose money unnecessarily.. that is why there is a science of price points. Ie., the price you can raise something to and increase revenue. I can assure you that even if NBC were to lose some people by raising the prices of their video (you perhaps), they would more than make up for it in extra revenue (if they did their studies right and have identified the correct price point). Even if they haven't, apple does not want them to discover the price point. By keeping videos at $1.99, NBC will never know what the best price point is. I'm sure that is what they are thinking. I'm sure if revenue decrease more than offset additional revenue, they would adjust their prices.
So NBC is right.. the only entity a $1.99/video helps is apple. That helps them sell their ipods cause they are selling NBC product at an artificial low price. How do i know it's low?.. cause they are selling old episodes for $1.99, same as new episodes.. either apple is robbing the consumers (cause there is no way in hell an old episode is worth as much as a new one.. or even an episode from a less popular show worth as much as one from a very popular show) or they are taking revenue from NBC.. ie, NBC is subsidizing the sales of Video Ipods.
Was this the kind of argument you wanted to see?.
(i'm sure a few mac fans knew this but why would they point this out?.. apple is great, everyone else is greedy).
Fine, sure, but you seem to have a pretty relentlessly negative attitude towards pretty much everything Apple does. Is it really that rewarding to be the guy that tells Apple enthusiasts that they are full of shit, over and over again, on an Apple enthusiast discussion board?
I mean, knock yourself out and all, I'm just sayin.
Oh come on.. people have been attacking NBC left and right and trumpeting how virtuous apple is. I'm not even saying apple is bad. I'm just saying they are not in the right and you know what?.. apple fans need to be told sometimes that they are full of shit. Why should i sugarcoat it?.
Think about it.. how can $1.99 videos favor NBC?.. people say that NBC makes more money at $1.99 but these people are not economists.
Here is an article from wikipedia discussing price points...
Some Math:
Heroes Season 1, HD DVD, MSRP $99.98 or $4.35/show, Amazon price $69.95 or $3.04/show
Heroes Season 1, SD DVD MSRP $59.98 or $2.60/show, Amazon price $39.99 or $1.74/show
Heroes Season 1 Pass, SD iTMS $42.99 or $1.87/show
Given these prices and the lower cost of manufacturing the download file, minus the "special features" , shipping, and advertising Apple's retail price for the downloaded file is a pretty good deal for NBC for the SD version which is actually selling for more per episode than the DVD with less extras and no physical media or shipping costs based on a real world price from Amazon. Given these figures a "reasonable" price based off of real world examples would put the SD version at the same that it is currently getting at iTMS or moving it up to a HD format would give us about $72.91 for a season pass or $3.17 a show. Now iTMS gives the consumer an earlier outlet for the purchase than a DVD does, but at a lower cost to manufacture and advertise than the DVD does and with fewer features to the consumer. A price increase should be expected if there is going to be a move to HD, but a good value for the consumer would place it at $2.99 or $3.49 an episode as a final cost.
I would imagine that there is a lot of posturing on both sides of this to get what they want, and there might be more to this than just the sales. Apple would probably like to have access to the Hula service, and NBC would probably like access to AppleTV as a quantifiable ad revenue based "on demand" stream for new shows to offset ad revenue lost to DVR timeshifiting, and put off releasing a retail version until after the season is complete. There is most likely more to the story than that as well, including both companies trying to get the upper hand in the deal. I wouldn't say that either company is an Angel here, hopefully the consumer will come out ahead.
One thing to remember with Apple is that they historically prefer single price schemes for their products, even though that may hurt them at times.