Apple refutes NBC's pricing-policy claims
Apple has taken issue with NBC's claims that the media conglomerate was able to change pricing policy at Apple.
NBC Universal executives have suggested that they agreed to start selling downloads of TV shows on iTunes only after being allowed more flexibility to set prices for its wares on iTunes. That's just not correct, Eddy Cue, the vice president in charge of Apple's iTunes Store, told CNET News on Wednesday evening.
On Tuesday Apple announced at the company's "Let's Rock" press gathering that NBC shows were returning to iTunes. A year ago, NBC yanked its show off iTunes over the issue of pricing. Following the press event Tuesday, JB Perrette, who runs NBC's digital unit, told CNET that Apple's increased flexibility on pricing led to agreement between the two companies.
He said that NBC was given a chance to charge $2.99 for high-definition downloads of its TV shows and that it also could sell catalog titles for 99 cents or $1 less than the price for the vast majority of videos sold on iTunes. NBC would also, according to Perrette, be given the opportunity to bundle TV show compilations and sell them for whatever it wanted.
However, all of this was available at iTunes before the NBC deal was struck, according to Cue.
Cue pointed out that while most TV shows sell for $1.99 on iTunes, retailers have always been allowed to sell videos for less. He said Viacom has offered many of its shows for 99 cents, including episodes of South Park and MTV's The Hills. The History Channel has offered shows such as Ice Road Truckers and Ax Men
"We've never told anyone they can't lower prices," Cue said.
Cue said that the $2.99 price NBC is selling its HD content for is the same price for all HD content. "People can see (Showtime's) Californication in HD live right now on the site," Cue said.
And when it comes to packages, Cue said there have been packages on iTunes before.
"If you look at some of the things we've done for holidays," Cue said, "we've had holiday packages with shows with the right themes. We've done things in the past with big name actors so we've packaged those things in the past."
Both Cue and Perrette say their companies are glad to be working together again, but what this disagreement over how NBC returned to iTunes illustrates is how the relationship continues to be a troubled one.
The two engaged in a public relations battle last year when NBC suggested that it wanted out of its iTunes contract. Apple fired back by accusing NBC of demanding that iTunes double prices of its content on the site.
This time around, NBC again was able to circulate it's version of events before Apple.
"Frankly, ever since we dropped our relationship with Apple last fall, they have made a gradual progression culminating in (Tuesday's announcement that NBC was returning to iTunes)," Perrette told CNET. "Originally, Apple had no film content (from the major motion picture studios) on the service because they were asking the film studios for years to accept a price that was below their DVD price.
"Apple realized it wasn't worth the fight anymore," Perrette continued. "They were better off to just have the content. So they agreed to the pricing that was at least equal to the DVD pricing."
Cue disagreed that pricing policy has changed at iTunes.
"We're glad to have NBC back and they are participating under the same terms with all of the other content providers."
Greg Sandoval covers media and digital entertainment for CNET News. He is a former reporter for The Washington Post and the Los Angeles Times. E-mail Greg, or follow him on Twitter at http://twitter.com/sandoCNET. 
And so people will continue to buy low quality drm infested mp3s.
But the Music Cartels refuse while giving open tracks to other providers.
Place your blame where it belongs...
Apple is more than willing to sell higher quality AAC files without DRM.
But only EMI allows them to do so. The other record companies allow Amazon to sell higher quality, DRM-free music, but not Apple.
What's silly, is that the record companies could set up their own online stores, ditch Apple, Microsoft, Real, and everyone else (since they aren't using DRM anymore with Amazon), sell whatever they want, at whatever price they want and in whatever "bundles" (re: albums) and quality level they want. And they keep ALLL the profit!
Is that so hard?
Apparently.
Because they're a bunch of greedy bastards.
Same goes for my "ex" DVD collection.
What once used to fill a room, first with VHS tapes, then with hundreds of discs, now fits on a tiny hard drive, and to me, that is "better".
It's called "progress", dude, and you will NEVER convince me that buying discs is better than digital downloads.
I did EXACTLY the same thing over Galactica. I even wrote NBC and told them what I was doing, and I said that until they ended their "war against consumers", I'd not watch NBC programming again.
It's funny, but after trying this out for a year, I found out just how little the tube meant to me, and I even went as far as canceling my subscription to ComCast.
Yo! ComCast? NBC's idiocy cost you a customer!
You don't need a PHD to figure out what happened. Greedy NBC looses, Bratty NBC lies to make themselves look good. Glad I'm not related to one of those NBC people. I'd hate to be living under one roof with a bunch of arrogant childish brats. Are these people even adults?
It seems that there is no tv show or music that is so compelling as to override the convenience and ease of use of iTunes presents to the consumer. Despite cheaper, DRM-free alternatives out there.
Apple has this market completely and utterly sewn up and there is nothing Microsoft, Amazon, Real Networks, or anyone else can do about it. Any money they spend trying to break Apple's stranglehold here is a collosal waste of resources.
Sewn up, yes. But, the government CAN do something about it. It's a monoply apple is abusing.
I thought I remembered reading however long ago that NBC left iTunes because of the fixed pricing structure. I also don't remember this being refuted. Now Apple is saying that they've allowed content providers to adjust pricing all along?
Anyway, roll-on TV Show rentals and bundles and good-bye scheduled programming.
McD
The whole "relationship" appears to be a troubled one classification is primary the author's inference. NBC was given pricing flexibility (i.e., you can lower prices for SD content below 1.99, and HD content will sell for 2.99 or less), when it was the author's fault to make preposterous interpretations of this claim in his previous article.
Clearly, the author misinterpreted the "pricing flexibility" that NBC was talking about in his earlier article and now is quoting this as "troubled relationship" to continue these two companies to talk and give this non-journalistic article more hits.
What else do we expect from CNET!
In this case, Apple is on the side of the consumer. No artificial high pricing, no bundling (you can buy your Heroes, but only if you also buy that stupid Office show with it), no preferred, exclusive deals. You get what everyone else gets. Apple and iTunes liberated music from the shackles of the Album (artificial construct designed to sell crap together with a few good hits, thereby increasing profits significantly), and they are on the way to liberate the video content as well.
Apple's Eddie Cue was simply defending the truth here and it had to be done.
- by jrg--2008 September 12, 2008 12:34 AM PDT
- iTunes Music store is just a shop, and it's not the only way to sell music or video for an iPod (although it is the only way to "protect" that video or audio with DRM.)
- Like this Reply to this comment
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(26 Comments)A retailer should be able to set the price they sell at. If it's too high, no-one will buy. If it's too low, they won't make enough money to cover costs. If NBC want to charge too high a wholesale price, then the shop won't stock the product. (I wholeheartedly agree with other posters who have said that of course online should be cheaper than a DVD - you get less: no 'bonus content', no physical media or packaging, booklets, etc., and a lower video quality. Clearly NBC does not want to hear that.)