NBC admits asking Apple for a cut of hardware sales
updated 01:55 pm EDT, Thu May 28, 2009
NBC Apple negotiations
NBC's CEO Jeff Zucker has shed more light on the network's negotiations with Apple over iTunes content, according to an interview with Kara Swisher at the All Things Digital conference. The relationship between the two companies has been shaky at best, with disagreements over the iTunes pricing policies.
“We’ve always loved Steve, it’s not personal,” says Zucker. “We didn’t think that a library copy of the Rockford Files should sell for the same price as a new copy of Battlestar Galactica.”
Zucker also noted that "Apple didn't want to cut us in on hardware sales, which we asked for. That's their business, so I get it." It is unclear which hardware NBC was referring to in the negotiations.
The bitter dispute became apparent in 2007 when NBC decided not to renew the contract to keep its content on iTunes. Apple claimed it was asked to increase the pricing of shows from $2 to $5, although the network denied the allegation. “But they’re the only people who get to set wholesale and retail price," Zucker said in the recent interview. "That’s not the way most businesses work.”
Many believe the actions could have been an attempt to stop Apple from gaining the same dominance over video media companies that it has established over the music companies. A year later, however, other major networks did not join in the protest and Apple began to allow slightly flexible pricing. NBC came back on board with many of its shows available in HD quality for $3, which now account for half of its iTunes sales.
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Negotiations
In every sale there are at least two parties and for something to happen, an agreement must be reached... obvious. So then VALUE enters the picture. If nothing happens, each goes their own way. Sometimes it works and sometimes it doesn't. I doesn't look to me like NBC has a great hand to play and by playing hardball they risk not getting to play at all except with substandard services.
When Zucker says"That's not the way most businesses work" he may be getting it. Business has changed but the old businesses haven't.
Stop looking over your shoulder and look straight ahead with peripheral vision for the side. Because one nitwit paid something for hardware sales doesn't make Apple a nitwit for not agreeing to such. Pretty much a really DUMB idea. You buy a card without a CD player in it and decide to get one installed... why should the car manufacturer pay the CD player maker? Increase the price of the CD player... ah, that won't work. Well, you are close to getting it.