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."