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Apple terminates contract for NBC on iTunes

updated 01:40 pm EDT, Fri August 31, 2007

iTunes ends NBC contract

In a fight over pricing, Apple today announced that it will not sell NBC television shows for the upcoming television season on its online iTunes Store. The announcement follows NBC's decision to not renew its agreement with iTunes when Apple declined to pay more than double the wholesale price for each NBC TV episode, which would have resulted in the retail price to consumers increasing to $4.99 per episode from the current $1.99. ABC, CBS, FOX and The CW, along with more than 50 cable networks, are signed up to sell TV shows from their upcoming season on iTunes at $1.99 per episode. Apple noted that NBC supplied iTunes with three of its 10 best selling TV shows last season, accounting for 30 percent of iTunes TV show sales.

"We are disappointed to see NBC leave iTunes because we would not agree to their dramatic price increase," said Eddy Cue, Apple's vice president of iTunes. "We hope they will change their minds and offer their TV shows to the tens of millions of iTunes customers."

Apple's agreement with NBC ends in December. Since NBC would withdraw their shows in the middle of the television season, Apple said it has decided to not offer NBC TV shows for the upcoming television season beginning in September.




by MacNN Staff

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Comments

  1. mgpalma

    Joined: Dec 1969

    0

    What do you want to bet

    NBC will change their minds?

    "Since NBC would withdraw their shows in the middle of the television season, Apple has decided to not offer NBC TV shows for the upcoming television season beginning in September."

  1. Mactarian

    Joined: Dec 1969

    0

    Good Riddence NBC

    NBC is only hurting themselves. Perhaps they just want to sell their stuff to 50,000 Zune owners worldwide.

  1. Terrin

    Joined: Dec 1969

    0

    Wrong Headline

    The headline, as often seems to be the case, is plain wrong. NBC is honoring its current contract, thus it cannot be not terminating it. It simply is choosing not to re-enter a new contract. However, since the current contract lasts until December, why bring it up now? Surely, it is a publicity ploy designed to put pressure on Apple.

  1. dliup

    Joined: Dec 1969

    0

    even lower sales...

    NBC actually has the lowest rating out of the three major broadcasting stations. Their rating is so bad that their own show, the late night show with Jay Leno, keep making fun of the NBC execs.

    Anyhow. No iTunes and other bad chocies made by NBC execs would probably result in even lower ratings / earnings.

  1. Durinn

    Joined: Dec 1969

    0

    Doesnt make sense

    This is the same network that offers a lot of this content on it's own site for free. I watched several heros episodes there last year. But they think Apple should charge 5.00 an episode? Would a season then cost 120.00? When the DVD would only be 40-45.00 at Best Buy? When I had to travel and missed an episode 2.00 was fine to catch up on the current week. No way I'd pay 5.

    At some point these content providers have to realize consumers are smarter than given credit for. The gravy train days of overcharging, building an entire album of 10 tracks off one good one and repackaging the same content again and again are over.

    I'm tired of them saying - yes you bought it - but only in that format - you dont really own it and now thinking ill pay 5 bucks a piece for 26 episodes of content that was already paid for by advertisers.

    Be happy you have a secondary market at all.

  1. gambit23

    Joined: Dec 1969

    0

    Man.

    This is the type of stuff that makes my blood boil. iTunes is a good thing for consumers and the studios, yet the studios keep trying to raise the prices and botch everything up.

    NBC: iTunes SAVED the Office. NBC was going to cancel the show but the show was so popular on iTunes that they kept it going. Now they want to pull this bullshit?

    I was going to subscribe a few TV shows this year but now I think I'll boycott NBC offerings. If people want to send a message, this is the way to go.

    f*** NBC.

  1. quandmeme

    Joined: Dec 1969

    0

    Bittorrent

    Some people go to bittorrent as it is; $5 will certainly drive even more. I think Apple is smart, even if NBC is right and Apple is driving up sales of hardware with deliberately underpriced media, in that making legal media convenience and relatively cheap, consumers are being trained how to pay for media. Only in a few years after the culture is entrenched should there be any attempt to offer flexible pricing. Not that I think of though, on the other hand bittorrent might become more convenient at the same time (which, to me includes the reduction of risk of infection or liability). Guess each company has to play it the way it sees it.

  1. ZinkDifferent

    Joined: Dec 1969

    0

    Time to short....

    ...NBC stock. Actually, time to count down to see them crawl back.

    Smart move on Apple's part to just essentially pull the rug out from underneath NBC, and terminate them before the season started. I'm sure NBC was hoping to start their shows in the season, and then pull them at contract termination time, and hope that the consumers, suddenly deprived of their shows mid-season, will put pressure on Apple.

    Well, yeah, if Apple were as dumb as NBC execs this ploy might have worked....

    Instead, they now lost their only possible bargaining chip, and got their lunch handed to them... Gotta love it.

    I guess all that means is that all fans of HEROES will go back to downloading their favorite episodes from the internet .... just not in any manner that NBC would profit from it.

    Honestly, with the ease with which downloads are available, I wouldn't even bother with the free viewings on NBC's site.

    Time to remove other NBC / Universal properties from my shopping preferences as well.

  1. lockhartt

    Joined: Dec 1969

    0

    nbc

    has a fairly long history of "brilliant" decisions, and their current standings are a clear demonstration of the effectiveness of executive management and those decisions.

    Of course, with Microsoft having a fair stake in the NBC enterprise, one can only wonder about the motivating factors here ;)

  1. estranged

    Joined: Dec 1969

    0

    Economics

    Faced with falling demand, and an infinite supply... lets raise prices! I'll just take my entertainment dollars elsewhere.

    http://requestresponse.blogspot.com/2007/08/nbc-to-pull-shows-from-itunes.html

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