Analyst: iTunes pricing spat with NBC could hurt Apple

#1 MW Forums

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Posted 31 August 2007 - 02:30 PM

An analyst says NBC may lose millions by its decision to not renew its iTunes Store contract, but the move may help undermine Apple's aspirations of dominating online videos the way it does digital music. more

#2 daneb

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Posted 31 August 2007 - 05:39 PM

News flash: It's going to hurt NBC too! I lower my opinion of Universal everyday, they just get worse and worse, trying to screw the consumer.

#3 Quoth_the_Raven

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Posted 31 August 2007 - 05:52 PM

Here's a better analysis:
Consumers could hurt NBC's bottom line by realizing that they could be obtaining these overpriced TV shows for absolutely free...without DRM restrictions and in HD

#4 drdreric

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Posted 31 August 2007 - 06:31 PM

Difficult to believe that via advertising NBC will make even 10% per download what they make per download when people make a purchase through iTunes. The idea they will go from $60 mil via iTunes to 100's of millions via advertising sponsorships in just a few years seems to imply an unlikely growth scenario.
Furthermore, they just don't get it. If I buy a show I want to have a copy I control and can take with me where I don't have a broadband connection to their web site.
I understand they hope to forestall Apple dominance. I think they are hosed.

#5 producer

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Posted 31 August 2007 - 06:33 PM

NBC? I haven't watched any shows on NBC for the past 5 or 6 years and don't foresee tuning in for any of their mediocre programming this year. I can't say that I'll miss the other Universal programs that will go away, either. This spat just leaves more bandwidth for the good stuff on the iTunes Store. So long, NBC/Universal. Don't let the door hit you in the arse on your way out.

#6 FloridaFlash

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Posted 31 August 2007 - 06:33 PM

Folks, just because NBC sent a 90 day notice that it is not continuing its current deal with Apple does not mean that NBC will not continue to deal with Apple. NBC knows that if it doesn't send the notice it is stuck with the old deal for another term (what was the original term? one year? two?). NBC had to send this notice in order to keep its options open. Anyone who thinks NBC is not still talking to Apple about terms of renewing the arrangement has never done a business deal.

#7 tomtom

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Posted 31 August 2007 - 06:41 PM

Nah! Apple did the right thing even if NBC accounts for 30% of TV shows transactions.
Apple has a valid marketing proposition and part of this is a price point of convenience. Any departure from this price of convenience will result in more piracy as well as using the fine but time and computer resource consuming services of EYETV and Tivo.
I live in London where we have not (to date) had iTunes video content. I have set up my scripts to get almost all of the shows I need from Digital Terrestrial Transmissions to iTunes or any other format required. If i could purchase these shows from iTunes at the US prices, I would. At 5 bucks, no way.

#8 machadodesign

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Posted 31 August 2007 - 06:43 PM

I think Apple would have been better served in letting them change the price to $4.99. If the market will pay $4.99 (which I doubt it will), then Apple is missing out on revenue. If it won't, then NBC is locked into a contract that will ensure their failure and they become an example to the rest of the money grubbing idiots running the other studios.

#9 tomtom

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Posted 31 August 2007 - 06:43 PM

Do let the door hit you........... on the way to the graveyard.

#10 Kazot

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Posted 31 August 2007 - 06:47 PM

If Apple announces reasonably priced video iPods using OSX (and maybe WiFi) next week, the iPod wannabes are toast and iTunes wannabes are going to have a tough time.
I think NBC may have mistimed their decision. Maybe they should have kept quiet on the negotiations? Having contract disputes in the news is strange.

#11 ralphmegna

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Posted 31 August 2007 - 07:01 PM

Does anybody else think that this "analyst" is a moron?
If NBC doesn't want to provide iTunes with programming, then f--k them. As we speak, I have a bit torrent running in the background downloading an NBC show that I could have purchased from iTunes as I have hundreds and hundreds of songs, tv shows and movies. Instead, I will just go to the web to get this stuff so I can run it on my video iPod and iPhone.
So, explain to me again, Analyst Nancy, how is Apple going to get hurt here? Its margins on content are microscopic; the iTunes store is mostly a means of driving iPod sales. I am going to still buy Macs, iPods and iPhones, from which Apple profits hugely. Meanwhile, the greedheads at NBC have lost me as a customer and won't be making another dime from me. And yet you contend that Apple is the one that is going to be hurt by this.
Yes, Analyst Nancy, you are a moron.

#12 Bob_Hancock

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Posted 31 August 2007 - 07:05 PM

Notice this "brilliant" analysis from Forrester Research:

Quote:

The incident reflects how poorly the iTunes video store has done relative to the iTunes music store, said James McQuivey, an analyst with Forrester Research. It shows how paltry and uninfluential the video side of the iTunes house is, he said.

Now notice the article author's next insight:

Quote:

iTunes does make up the bulk of the online video resale market, but the market is small.

My non-spinned observation: iTunes dominates the bulk of what constitutes a relatively small market for online video sales. McQuivey illegitimately scorns iTune's video sales just because they're paltry compared to the sotre's music side of the market. He ignores the fact that the entire online video sale market is small, and the fact that online video sales are still in their infancy compared to the more mature online music sale market. The non-spinned analysis would be that iTunes video store dominates the online video sales market. End of story. Sheesh.

#13 Dan Frakes

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Posted 31 August 2007 - 07:07 PM

Quote:

So, explain to me again, Analyst Nancy, how is Apple going to get hurt here?...Yes, Analyst Nancy, you are a moron.

You might note that Nancy was the author of the article; the analyst was James McQuivey of Forrester Research.

#14 Luis_Alejandro

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Posted 31 August 2007 - 07:13 PM

Quote:

NBC knows that if it doesn't send the notice it is stuck with the old deal for another term (what was the original term? one year? two?). NBC had to send this notice in order to keep its options open.

Your thinking (and knowledge of contracts) i, IMO, correct.
But they do not have to send the notice over the news.
They, again IMO, are trying to move the battle to other fields, trying to make up some waves against Apple.
But this is, also, common commercial practice!