Thursday, September 6

Killing Digital Heroes: NBC Universal

“Unfortunately, Amazon Unbox videos and the Amazon Unbox video player are not compatible with Apple/MacIntosh hardware and computer systems.” –

And as Amazon goes, so goes NBC Universal’s ability to put top-selling shows like Heroes and The Office into the hands of iTunes consumers. The losers, undoubtedly, will be consumers in what some are calling one of NBCU’s worst decisions since it entered the digital media arena.

According to Apple, NBCU had reportedly sought more copy-protection controls as well as more pricing flexibility. Apple said that NBCU had asked for “more than double the wholesale price for each NBC TV episode,” which would have resulted in a $4.99 per episode price. The episodes are now listed on Amazon for $1.99.

“With the addition of NBC Universal TV content to Amazon Unbox, fans now have the ultimate convenience for enjoying their favorite shows whenever or wherever they want,” said Jean-Briac Perrette, president of digital distribution for NBCU, neglecting to mention that only Amazon Unbox customers (which exclude Apple portable media owners) will benefit from this convenience.

The post-negotiation public debate being played out between Apple and NBCU reinforces an increased trend toward companies airing disagreements in public, knowing that if the media does not pick it up, then high profile bloggers will.

“What they’re going to have to realize is that out of all the dozens of shows available out there, most people only want the four or five most popular shows,” James McQuivey, an analyst at Forrester Research, said (as highlighted on Terry Heaton’s blog). “And if those aren’t there, those consumers are just going to walk away.”

McQuivey is right. As much as I like Amazon, I won’t have a choice when it comes to Unbox video player. Since we work on Macs, play on Macs, and own iPods, NBCU’s decision is clear: if we miss a broadcast, our only option is to watch something else. How’s that for content protection?

Apple seems to be doing its fair share to protect NBCU content as well. Apple decided it will no longer sell new NBC shows, including those that will premiere next month. Fortunately, iTunes has other shows to consider, including those that might distract the fans of Heroes and The Office.



Geoff_Livingston on 9/6/07, 1:10 PM said...

I saw NBC Universal Vice Chair speak at GLOBALCOMM last June. They are bent on protecting their intellectual property in the new age. They are so bent they will lose market share. Good points, Rich.

Rich on 9/6/07, 1:16 PM said...

Thanks Geoff,

Yep. I appreciate the concern of networks wanting protect their content. We all do. But you know, this seems to go far beyond in that it seems to me that NBC was disappointed that consumers would rather by 1-5 episodes as opposed to a full season.

There is some good news for ABC, Fox, and CBS... they have crossover shows that seem to appeal to people who used to buy Heroes on iTunes (including Jericho, believe it or not). You never know; this could tip the programming balance in some cases.


Rich on 9/6/07, 2:21 PM said...

Famous Last Words:

"I hope that it does mark a change, I really do. But in future, if Jericho does not do well, I hope that doesn't mean that networks will go back to ignoring passionate viewers. That would be a serious mistake. Broadcast networks need to start treating viewers better, especially in this day and age when there are so many other options. It's shocking to me that they've gotten away with treating viewers so shoddily for so long." — Maureen Ryan, Chicago Tribune in an interview featured on Jericho Monster.

Sweet Tea on 9/6/07, 7:39 PM said...

You tell them, Maureen. Thanks Rich.

Anonymous said...

Great article Rich. I just think its funny for a company that tauts and toots their horn about expanding on digital media.. they contradicted themselves. If anything I think it puts other networks like CBS, ABC and Fox to really monopolize on selling to iTunes consumers.

Rich on 9/9/07, 9:22 AM said...

Thanks Ruth,

You're very right. I was very surprised by the decision. But, upon reviewing the Beth Comstock's WALLStrip interview again (in the margin), I can hear the internal struggle between content protection, cash, and digital media.

Personally, I think iTunes content protection — which I believe (not verified for video) is four devices at one time seems fair enough. Of course, Apple recently launched a new program that allows you to have less restrictions on music downloads for a modest .30 per song increase. Some people will opt for that (like me) and some will not (like my wife).

All my best,

Rich on 9/21/07, 3:45 PM said...

More Words:

More words on convergence:

"NBC Universal said yesterday that it would soon permit consumers to download many of NBC’s most popular programs free to personal computers and other devices for one week immediately after their broadcasts.

The service, which is set to start in November after a test period in October, comes less than three weeks after NBC Universal said it was pulling its programs out of the highly successful iTunes service of Apple Inc. That partnership fell apart because of a dispute over Apple’s iTunes pricing policies and what NBC executives said were concerns about lack of piracy protection." — The New York Times

Geesh, I guess the fight with Apple was worth it. Now they are going to give their shows away.


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