Forbes: Apple vs. NBC battle won’t amount to much

Apple iTunes“Apple! NBC! At war! Sounds like heady stuff: Apple and NBC Universal brawling in the press over an iTunes’ contract to sell downloads of NBC TV shows,” Louis Hau writes for Forbes.

“But we’re having a hard time getting excited about this particular battle. In the end, it probably won’t make much difference in the media industry’s embryonic efforts to make money from online video, which are shifting to advertising-supported streaming video. In fact, the dispute may not even affect the long-term availability of NBC’s content on iTunes,” Hau writes.

“While TV networks have a vested interest in remaining on iTunes, the online store will likely end up being less important to them over time,” Hau writes. “Rather than focusing on selling downloads of their programming, the strategy being pursued by NBC, News Corp.’s Fox, CBS , Disney’s ABC and Viacom’s MTV and Comedy Central is increasingly emphasizing the sale of advertising to keep their content free.”

“No doubt Apple sees the writing on the wall, which is why we can probably expect the company to come up with new ways of getting iPod owners the content they want. One possibility: Apple has reportedly been in talks with film studios about starting a movie-rental service on iTunes,” Hau writes.

Full article here.


  1. Meanwhile NBC will be fretting and wringing their hands trying to figure out how to make up the money they’re going to lose in this Fall season. They’ve got another think coming if they think the News Corps deal is their salvation.

  2. This is ridiculous: what iTunes (and bittorrernt) has done is to show people that they can watch a 42 minute program in one shot rather than having to sit through 18 minutes of commercials! I, for one, will never go back to watching TV with commercials again. If NBC et al think we’ll go back to the dark ages of ad-supported TV, they are the ones who have another thing coming.

  3. “Rather than focusing on selling downloads of their programming, the strategy being pursued by NBC, News Corp.’s Fox, CBS , Disney’s ABC and Viacom’s MTV and Comedy Central is increasingly emphasizing the sale of advertising to keep their content free.”

    This is the biggest pile of BS that I have ever heard.

    The fact is advertising is down because competition is drying up, and the reason for that is the population is increasing and more direct efforts, like paying supermarkets to gain shelf space (Walmart), is much more effective and pernament.

    Put it in front of the customer as the only choice and they are forced to buy.

    Content providers have diversed into selling TV shows as a way to offset the monopoloy of cable companies.

    This NBC “price hike” was just a cover ploy. Because they know Apple has to charge one price for the same type of content because PRICE SENDS A SIGNAL.

    Why is it that at movie theaters all the movies, good. bad and horrible are all priced the same? Why is it that the new haircutter at a barber shop gets the same price as a experienced one?

    Because if their price reflected their experience the customers would line up behind the more expererienced haircutter as to avoid a possible bad cut.

    Same thing with movies, price sends a signal that the quality is bad. Who wants to see a crappie movie with their new girlfriend?

    Apple has to charge one price for each content type as not to cause chaos from: price wars, which will shut out the less wealthy studios; conspiracies to set prices higher and basically kill the iPod/iTV sales; and other manipulative tactics.

    All the other contents providers have agreed to the one price, knowing exactly this information. Sure they all can agree AT ONE TIME, to increase the prices.

    So why does NBC want to raise prices? Control.

    With price as a signal they can manipulate you as the customer to buy cappie movies and reward studios who give them a bigger cut of the pie. They can also punish studios that want too much by lowering their prices on iTMS.

    Apple is catering to the richer crowd which can afford to download content to avoid advertising.

    The great experiment has been if this method can superceed advertising/free method, but appartantly it hasn’t. ABC moved their content to the web paid for by advertising. ABC is owned by Disney which Steve Jobs is the major sharholder.

    So NBC is off to do it themselves too, although they would have been better off keeping a foot in iTunes.

    I suspect they didn’t want to upset the cable companies, so they needed to keep their prices uniform.

    So many buisness models, so much competition. No wonder the customer just plops in a chair nightly, turns his mind off and watches the idiot box as it slowly destroys his ability to think.

  4. Now what begs the question.

    What if Apple allowed a iTunes streaming option to watch free TV content in exchange for advertising?

    Sure Apple has to charge for bandwidth, so lets say monthly subscription to offset that?

    Of course the cable companies would be livid and demand a cut of that for using their cable lines.

    I’m just wondering if Apple blew a big opportunity here.

  5. I don’t think it’s sorted out either way yet. A very small portion of people buy their tv on iTunes. It’s successful, but it’s not exactly huge when compared to the established advertising-based model.

    If anything, iTunes (and Steve) need to remain flexible and adapt when necessary, be strong and plow others over when necessary, and stay sharp. Easy enough. ” width=”19″ height=”19″ alt=”tongue laugh” style=”border:0;” />

    MW “serious” as in “I’m super cereal.”

  6. Apple hasn’t been doing a lot of listening lately.

    It seems like Steve is pushing to extract anything and everything he can, like he has a defeatist additude.

    Why cheap looking glossy screens? To push people into the more expensive machines?

    Why not listen to the needs of the Networks and offer a advertising based option in iTunes? Why make everyone PAY only?

    Why not own the online market completely?

    Look at Google, immensly rich from advertsiing.

  7. I quit watching television forty years ago because it was crap. Hasn’t seemed to have changed much since then, either. Nice to see Apple isn’t constipated. heh.

    btw, MDN .. we ordered one of those 2.8 GHz iMacs. It’ll get here in two or three weeks. We also got a free printer, a free nano, an iWork ’08 family pack and a copy of Parallels to go with it.

    And no .. I still can’t get an account at the iTunes Store with the same credit card that the iMac is on, regardless. Me? I think Apple oughta just tell the whole damn entertainment industry to shove their contracts up their ass and sell all available media to everybody, worldwide. Not that I’d purchase any TV shows, mind you. It would just feel good to see Apple do it. ahahaha.

  8. Don’t forget advertising isn’t just about products, it’s about politics, ideas, you are required to watch advertising so that ideas can be implanted in to your mind. Those 15 – 18 minutes per hour taken up by advertising are useless to you in small chunks but together you can put those minutes together to do something, something else, something useful, when you should be watching the propaganda.

    Advertising is clearly a time waster, you only purchase a fraction of the products that you see advertised, most adverts are just taking your time away. The most advertised products are junk, that is how they can afford to spend so much on advertising, the resources don’t go in to the product.

    There was a time a few decades ago when people were quite contented with their monetary wealth, they opted to work less hard, have fun, seek enlightenment, enjoy music and art, try to make the world a better place by demanding fairer employment terms and fewer wars. Now people work longer hours, unpaid overtime has become the norm, they have less time to make up their own minds and so opt for what is promoted most vehemently. Advertising has played a pivotal role in degrading the life experience for most ordinary people.

    Most people have heard of Sigmund Freud and his research in to how the mind works, few people have heard of his nephew, Edward Bernays, who took that knowledge and transformed it in to a tool for mass manipulation.

  9. If you’re so phuquen smart why aren’t you doing something important with your life?

    There is a market for ad free TV show sales.

    The sale of missed episodes can make or break a new offering on network TV. NBC is just trying to make their upcoming ad infested service more palatable. If it doesn’t work on an iPod it won’t be successful. NBC will learn the hard way, just like everyone else.

  10. Actually, this is what I have been expecting for years.
    Cable and FIOS will become another utility, offering the infrastructure.
    The content will be on the internet. Streaming.
    Eventually, you will watch the shows from the production studio web-pages.
    There will be no need for the networks, except the specialty channels.
    I think this signals more to the end of over-the-air dominence rather than iTunes.

  11. Gandalf:

    Although your commentary was a little muddled – I couldn’t agree more with the main point of your post.

    Even France, under its new president is trying to reverse the 60 year-long, hard-won principle of more leisure time and less work time. The time to enjoy family, art, music and literature. To relax. Paradoxically, this made the French worker more productive – per man-hour – than a number of its neighbors and much more productive than American workers [and that gap is widening]. The proof seems to be, a happy worker is a productive worker, n’est pas?

    Degrading the life experience will kill us all. I’m often reminded of that old advertising campaign from Europe: It basically ran… ‘No-one said on their deathbed, “I wish I’d spent more time at the office”.’

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