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News Corp. affirms loyalty to iTunes Store

updated 09:25 am EDT, Tue September 11, 2007

News Corp. backs iTunes

In the wake of the mutual fallout between Apple and NBC Universal over pricing, News Corporation -- owner of the Fox movie and TV studios -- says it will continue to sell shows through the iTunes Store. President Peter Chernin notes that contrary to speculation from industry observers, News Corp. has no intention of following NBC, despite wanting more control over video sales. "Right now we have a perfectly good relationship with Apple," says Chernin, "But let me say this, we're the ones who should determine what the fair price for our product is, not Apple."

NBC is rumored to have split with Apple partly because it expects its upcoming Hulu service to fill in the gap; News Corp. is also a partner in the project however, and Chernin argues that Hulu will not compete with the iTunes Store. The former will offer streams with advertising, Chernin says, whereas the latter sells ad-free shows to own.

The Fox networks comprise a small portion of iTunes' video content, with popular shows like "24," "House" and "American Dad" being complemented by sports and reality programming. NBC Universal is still currently the largest video supplier, providing 40 percent of all material, among it shows like "The Office" and "Battlestar Galactica."




by MacNN Staff

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  1. estranged

    Joined: Dec 1969

    0

    The market decides price

    Quoting Chernin, "But let me say this, we're the ones who should determine what the fair price for our product is, not Apple."

    Actually the market will decide what a fair price is. The studios are welcome to try and set whatever wholesale price they want, Apple is free to set whatever retail price they want. If anyone ends up buying it at the end of the day will determine if those prices are 'fair'.

    http://requestresponse.blogspot.com/

  1. BelugaShark

    Joined: Dec 1969

    0

    Doodus

    the guy looks like mr.bean

  1. mgpalma

    Joined: Dec 1969

    0

    re: the guy looks like...

    Um, not at all.

  1. vasic

    Joined: Dec 1969

    0

    he is right; however...

    In the sense that they own their content, on principle, he is right about setting the prices. However; there is a big however (or, should i say but)...

    It is clear that neither music labels, nor studios, have a clue how the market works in the download space. They in fact don't really know much about market rules in general; they've been doing the same business model for generations, this is the only thing they know, and they know how it works: they set the price, people buy CDs, (or TV ad time) since there's nothing else. They're now freaking out, since there IS something else, and are clueless about how it works.

    In order to succeed online, they MUST TRUST Apple. That is the ONLY way for them tu survive. As much as they may hate giving up control, there is no other choice for them now. Eventually, when the download market becomes mainstream, and they get a bit more comfortable (and gain some experience) variable pricing and other pricing models might be the way to go. Right now, Apple is the ONLY one that has figured it out. NBC will learn this the hard way. At least News Corp (Fox) has a clue.

  1. ClevelandAdv

    Joined: Dec 1969

    0

    Market Price

    The marketplace will determine what a product is worth. You can ask for whatever you want but if people will not buy it - then you have to reduce the price or go out of business.

    As for NBC - I purchased Battlestar Galactica from itunes as the DVD's were more than I wanted to spend for a TV show. Now that I am caught up - I will use my eyeTV to record the rest of the episodes (since NBC does not want my itunes $$).

  1. chucker

    Joined: Dec 1969

    0

    doodus?

    the guy looks like mr.bean

    its probably because he is picking his nose.

    though he does have a point. Apple may set a price, but the studios decide whether they want to sell or not (of course they could be spiting their own face by not doing so, but then that is another matter).

  1. testudo

    Joined: Dec 1969

    0

    Re: price

    Actually the market will decide what a fair price is. The studios are welcome to try and set whatever wholesale price they want, Apple is free to set whatever retail price they want. If anyone ends up buying it at the end of the day will determine if those prices are 'fair'.

    But Apple is basically attempting to dictate the price they offer wholesale. And when people (like NBC) say "No", they get blasted for being 'greedy'. Few seem to think that they should be given the option to set the price they want.

    In order to succeed online, they MUST TRUST Apple. That is the ONLY way for them tu survive. As much as they may hate giving up control, there is no other choice for them now. Eventually, when the download market becomes mainstream, and they get a bit more comfortable (and gain some experience) variable pricing and other pricing models might be the way to go. Right now, Apple is the ONLY one that has figured it out. NBC will learn this the hard way. At least News Corp (Fox) has a clue.

    That's so full of it. They MUST TRUST APPLE? Why must anyone trust apple. Just because they currently control all the online downloads, basically? I guess you also thought companies should just trust Microsoft, because they were the defacto standard? Oh, and we see how well that worked.

    And, maybe you didn't notice, buy now that the record labels 'trusted' apple, they tried getting different deals, but Apple, being the market leader (because they trusted apple and now are dealing with the large behemoth that is them) won't let them look for better terms (better for them, of course).

    And the only thing Apple figured out on downloads is how to make a good store that syncs easily with people's computers and devices (well, device, since it only syncs with the iPod). They just decided on a price, and just sticking to it because they think its the best way (again, going on the 'variable pricing is just too confusing for people' philosophy, because we're all stupid asses who can't make our own minds or something).

    I just don't the reasoning that a 23 minute sitcom should cost the same as a 45 minute drama/sci-fi show as a 40 year old tv show from NBC's back-catalog.

    And no one's yet really explained why its OK for Apple to do variable pricing on movies, but for TV shows, its a bad thing?

  1. cblackmo

    Joined: Dec 1969

    0

    Who's price??

    They have a right to determine what they "think" is a fair price; just as much as consumers have a right to think they're full of c*** and not accept their prices; and just as much as Apple has a right to determine the terms which providers must comply with.

    These people baffle me how they continually overlook the fact that Apple has provided them with a "privilege" and "opportunity" to have access to APPLE CUSTOMERS.

  1. ethical_paul

    Joined: Dec 1969

    0

    Pricing how it should be

    People seem to have forgotten how pricing works in a distributor system in the US.

    The manufacturer sets the price to the distributor (obviously) since the distributor is the one buying it.

    The distributor sets the price that they sell it to the end user. This allows efficient distributors to charge less and is healthy for the market.

    Manufacturers try all the time to set the price to the end user artificially high, but until just this year, that was actually illegal (yes Apple does this like crazy and has for years). Bose for years has been a prime offender.

    That's why it's called "Manufacturer's SUGGESTED Retail Price".

    Jobs is actually a huge hypocrite here. Ask all the Apple resellers if they can charge lower than MSRP for their Apple stuff. They can't. And yet he doesn't call himself greedy.

    I can excuse it though because I'm a fanboy.

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