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NBC Not Renewing Its iTunes Contract on Pricing Differences With Apple; On Till December

By Rafat Ali - Thu 30 Aug 2007 09:55 PM PST

imageFirst a rift over music pricing with Universal Music Group (owned by Vivendi), and now a tiff with NBCU (NYSE: GE): NBC has decided not to renew its contract to sell downloads of its TV shows on Apple’s iTunes (Nsdq: AAPL), after disagreement over pricing, reports NYT. NBC was in early on iTunes’ video offering, and now accounts for about 40 percent of downloads. It notified Apple of its decision earlier today, the story says. The current two-year deal extends through December, so the 1,500 hours of NBCU programs will remain available on iTunes at least until then.

Similar issues to UMG: the media companies want better control over pricing decisions. For example, TV show episodes sell for $1.99, with movies priced at $9.99. NBCU wants to sell a package, say an episode of “The Office” with the movie “The 40- Year-Old Virgin,” because they both star the comedian Steve Carell, an example in the story says. Apple wants simplified pricing, as it has said all along.

Also, NBCU is also seeking better piracy controls and wants Apple to allow it to bundle videos to increase revenues, the story said. A deal could still be reached before December, though..While each side has so far refused to budge, the talks will continue and have been free of acrimony, the story cites a source.

This also comes as NBCU-Fox video joint venture Hulu is about to get off the ground, where NBC will be putting most of its shows for free streaming and distribution. Also, NBC.com has been streaming many of the prime-time shows, and earlier today, announced free streaming of “Late Night with Conan O’Brien”, the first late-night talk show to do so.

Posted in: Companies, Apple, NBC Universal, Media, TV



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2 Responses:
  • From Ryan Massie Fri 31 Aug 2007 04:34 AM

    A drop in content on iTunes shall be matched with an increase in piracy of NBC content. It’s that simple.

  • From Roland Brad Wed 05 Sep 2007 08:31 PM

    Let’s hope that GE will reconsider. The internet is here to stay and the indications are that I-tunes and I pods will only accelerate in their popularity.
    The royalties from these downloads could prove to be significant
    revenue sources for GE in the future.

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