NBC refutes Apple's price claims, pledges iTunes shows
NBC Universal has rejected claims by Apple that it wanted to more than double the price of TV shows on iTunes -- and has also contradicted threats that new NBC shows would disappear from the iPod maker's online store.
In a statement to the press, NBC flatly dismissed Apple's contention that the TV studio's ultimate goal had been to charge $4.99 per show, more than twice as much as today's $1.99 rate. The actual goal has been to institute "flexibility in wholesale pricing" and bundle shows together in more "attractive" ways, said NBC's executive vice president of communications, Cory Shields.
The studio also insisted that all of its existing shows would see new episodes available for sale through iTunes in spite of Apple's declaration mid-Friday that it wouldn't carry updated NBC programming for the fall season. The company did not say how it intended to force Apple to agree to the terms, but appeared to use its existing contract as leverage.
"We want consumers to know that all our returning series, including new episodes, will be available on iTunes through the remainder of the contract, which expires in early December," said Shields. "Our content is also available on NBC.com, Amazon.com, and the soon-to-launch hulu.com."
The statement reiterates NBC's cautious approach to renewing its contract with Apple, leaving a window open for the the two firms to resolve their dispute before the end of the contract. But in a counter to Apple's own allegations, NBC argued that its would-be partner was the unreasonable firm in the dispute, attempting to keep prices at its media store fixed in a way that favors sales of iPods and iPhones above the shows themselves.
"It is clear that Apple?s retail pricing strategy for its iTunes service is designed to drive sales of Apple devices," Shields asserted," at the expense of those who create the content that make these devices worth buying."
The confirmation of variable pricing as a sticking point for NBC reveals the seriousness of the issue for its parent company Vivendi. July saw NBC's sister company Universal Music Group drop its long-term contract for iTunes music, choosing instead to offer music "at will" so long as Apple maintained its flat 99-cent song pricing. Warner Music and other larger labels have also made similar arguments, but aren't known to have abandoned their own contracts.
In a statement to the press, NBC flatly dismissed Apple's contention that the TV studio's ultimate goal had been to charge $4.99 per show, more than twice as much as today's $1.99 rate. The actual goal has been to institute "flexibility in wholesale pricing" and bundle shows together in more "attractive" ways, said NBC's executive vice president of communications, Cory Shields.
The studio also insisted that all of its existing shows would see new episodes available for sale through iTunes in spite of Apple's declaration mid-Friday that it wouldn't carry updated NBC programming for the fall season. The company did not say how it intended to force Apple to agree to the terms, but appeared to use its existing contract as leverage.
"We want consumers to know that all our returning series, including new episodes, will be available on iTunes through the remainder of the contract, which expires in early December," said Shields. "Our content is also available on NBC.com, Amazon.com, and the soon-to-launch hulu.com."
The statement reiterates NBC's cautious approach to renewing its contract with Apple, leaving a window open for the the two firms to resolve their dispute before the end of the contract. But in a counter to Apple's own allegations, NBC argued that its would-be partner was the unreasonable firm in the dispute, attempting to keep prices at its media store fixed in a way that favors sales of iPods and iPhones above the shows themselves.
"It is clear that Apple?s retail pricing strategy for its iTunes service is designed to drive sales of Apple devices," Shields asserted," at the expense of those who create the content that make these devices worth buying."
The confirmation of variable pricing as a sticking point for NBC reveals the seriousness of the issue for its parent company Vivendi. July saw NBC's sister company Universal Music Group drop its long-term contract for iTunes music, choosing instead to offer music "at will" so long as Apple maintained its flat 99-cent song pricing. Warner Music and other larger labels have also made similar arguments, but aren't known to have abandoned their own contracts.
Comments
Really? Then how do you explain Amazon selling the same content for the SAME price?? These executives take the masses for a bunch of idiots. The reason for all of this is to hike up the prices on iTunes ahead of the October launch of NBC and Fox's Hulu.
This war can be traced back to Universal demanding a cut of all iPods sold. Microsoft gave in and they are pissed that Apple said no way.
The above statement makes it clear that Shields thinks that they diserve all your money. After all you should be paying more because he runs a company that pays Actors, Directors, and Producers outragous sums of money. Not to mention the Gaffer making $120,000. a year to set the lights on the set!
As a minimum they should get their story straight.
I mean it's binary - they either wanted $4.99 or they did not.
Both NBC and Apple are assuming they know what the consumer wants. Both can be stubborn, but Apple is alot smarter about it and knows that people want to take media on iPods, on TV's and on computers while NBC still thinks media is only about online computer streaming video. It is like the record companies who want digital media to exist in a manner that they can "pull the plug" on when they feel they are losing control.
"After all you should be paying more because he runs a company that pays Actors, Directors, and Producers outragous sums of money. Not to mention the Gaffer making $120,000. a year to set the lights on the set!
Hey, why are you getting down on the people who are making the content? They're not the ones doing this; in fact, a lot of them are on the side of the angels. And most of the gaffers I know in TV and movies don't make 120K. You must know some really veteran gaffers with major seniority and a great exchange rate.
They are too stupid to realize that they will sell more shows and make more money if they keep the price low.
I've seen some things on Amazon cheaper than on iTunes, but other things MORE expensive. That indecisiveness was enough to make me stop looking. Everytime I see a DVD with little extras selling at Best Buy for $19.99 or $24.99 I scowl and keep moving. I keep thinking "Are you people HIGH?" Then I see the standard prices in supermarkets starting to excite people with a $9.99 and 2 for $15 bin.
Honestly, I'd by more movies if they all just cost $9.99. Really... I'd just BUY and BUY and BUY and BUY. As it is, I skulk around looking for this kind of pricing. If certain tv shows on iTunes started becoming $4.99, I'd probably browse less. I'd even want a feature that ONLY shows me $1.99 or less tv shows, because seeing anything higher would simply be annoying to even see.
If NBC is ending its deal with Apple... they should insert half-seasons into iTunes. It ruins the "season-pass" feature, and forces Apple to simply shut it off for NBC shows. If I used that feature, it'd be irritating to think I'm paying more per episodes knowing that I won't be able to finish the series.
Unless NBC changes their mind and re-signs, I really hope the new seasons of these shows don't appear. NBC's mad because they don't have their new venue in place yet, and it will be a clear "hiccup" where people will simply be unsatisfied. On the otherhand, if Apple waits until December, the decisions will all be made, and Apple will be holding the bag with irate customers caught in mid-season. It would be stupid.
~ CB
Is that similar to albums where only one or two songs in a $15 CD are any good.
My guess is NBC.
"NBC flatly dismissed Apple's contention that the TV studio's ultimate goal had been to charge $4.99 per show."--No, their intention was to incredibly raise their wholesale pricing without taking responsibility for the consequences. Talk about spin.
"...bundle shows together in more "attractive" ways"--What's more attractive than buying exactly what you want for an attractive price? Maybe... buy Heroes, get a free Taurus?
NBC could have used this opportunity to save face, but instead calls Apple the meanie, reiterates that their shows are only committed until December, and plugs their hulu venture and other retailers.
This reminds me of when people apologize for something and say, "I'm so sorry that YOU felt hurt."
Twisted.
The confirmation of variable pricing as a sticking point for NBC reveals the seriousness of the issue for its parent company Vivendi. July saw NBC's sister company Universal Music Group drop its long-term contract for iTunes music, choosing instead to offer music "at will" so long as Apple maintained its flat 99-cent song pricing. Warner Music and other larger labels have also made similar arguments, but aren't known to have abandoned their own contracts.
Yikes, there some embarrassingly SERIOUS factual errors in this report.
NBC-Universal is owned by GE. (Vivendi sold the Universal film/tv division to GE a few years ago, for $14 billion.)
Universal Music, on the other hand (as I recall; I have not looked this up prior to writing, but I am nearly 100% sure) is still owned by Vivendi.
I don't think that the "Universal" that belongs to NBC (film/video) has anything to do with the "Universal" that belongs to Vivendi (music) -- they are not "sister companies."
NBC will have to promise that the whole new season will be available before Apple takes them back. i.e. 1.99 is here to stay. bitches.
..... NBC argued that its would-be partner was the unreasonable firm in the dispute, attempting to keep prices at its media store fixed in a way that favors sales of iPods and iPhones above the shows themselves.
What a bunch of morons...... Apple is in the business of selling what?!
Oops..... answered below, by Mr. Shields:
"It is clear that Apple?s retail pricing strategy for its iTunes service is designed to drive sales of Apple devices," Shields [of NBC] asserted......
......said Shields. "Our content is also available on NBC.com, Amazon.com, and the soon-to-launch hulu.com."......
I don't know about amazon.com (too messy a site, and I do not go to it anymore), but I randomly checked nbc.com and hulu.com.
On nbc.com, when I clicked on the video for "Heroes" it tells me that the video for season one is "no longer available." (Where do you think it might be available?
As to hulu.com, right now, it seems to be vaporware. Check out for yourself whether you can download a darn thing yet!
These guys are a joke.
Yikes, there some embarrassingly SERIOUS factual errors in this report.
NBC-Universal is owned by GE. (Vivendi sold the Universal film/tv division to GE a few years ago, for $14 billion.)
Universal Music, on the other hand (as I recall; I have not looked this up prior to writing, but I am nearly 100% sure) is still owned by Vivendi.
I don't think that the "Universal" that belongs to NBC (film/video) has anything to do with the "Universal" that belongs to Vivendi (music) -- they are not "sister companies."
Actually, that's not really true!
According to Wikipedia (which should be accurate, in this case):
"NBC Universal is a media and entertainment company formed in May 2004 by the combination of General Electric's NBC with Vivendi Universal Entertainment, part of the French Media Group, Vivendi SA. GE owns 80% of NBC Universal with the remaining 20% owned by Vivendi SA."
So they're sister companies in that Vivendi owns a significant stake in both, even if one isn't a majority stake.
The above statement makes it clear that Shields thinks that they diserve all your money. After all you should be paying more because he runs a company that pays Actors, Directors, and Producers outragous sums of money. Not to mention the Gaffer making $120,000. a year to set the lights on the set!
First you obvsiouly don't know how much a gaffer makes. Seasoned gaffers in Los Angeles can make 70-80K a year. That's not a lot in Los Angeles.
Second, you don't know what a gaffer does. Gaffers do not set the lights on the set. They accurately determine, based on the type of camera, the camera angle, position of the actors, materials used in the set construction, desired lighting effect, and a lot of other factors, the luminosity, angle other information about the lighting. Saying that a gaffer "Sets the lights on the set" is like saying Steve Jobs "tells people what to do". Listen to the commentary on DVDs of a show like West Wing and you'll hear the director rave about theLD (who is a gaffer) at least once.
Third, an Apple fan accusing Hollywood of having inflated salaries is like the teapot calling the kettle black. As a person who works in the technology business in California and knows many Apple employees, you should find out what Apple pays even its entry level engineers. Hint: $120,000 isn't too far off for those guys.
And all you Apple fanboys (on this site and others) who say they will "get their NBC content one way or the other (hint hint, wink wink)" should think about the NBC person who says "I will get Leopard one way or the other" too. Pirating Leopard is just as easy, and just as wrong.
They've been paying too much attention to GOP political strategists over the years.
I think Cory Shields lied and I'd enjoy seeing Apple lay down the proof of his lie for everyone to see. We all know that studios would love to raise their prices for their shows and if Apple said that NBC wanted to raise the rates to $4.99 an episode, I'm betting that's actually what they wanted. I know it would disappoint some on this site if Apple did freeze all of the NBC shows in December when the contract ends, but then we'd get to watch NBC realize just how big a mistake they made. NBC must first and foremost please its customers. Those same customers have iPods. NBC will learn - even if it's the hard way.