Since I got my iPhone, I’ve been buying a lot of TV shows on iTunes, so I can carry them with me and watch them wherever I am. Most of the time that watching is done when I’m in my room, right before bed (I don’t have a TV in the bedroom right now). However, the freedom of watching a TV show or a movie when I’m out eating dinner (by myself, of course, that would just be rude in the face of other company), or waiting in line at some place, is quite priceless.
So I was a little disappointed when NBC decided to have a bit spat with iTunes, and decided to pull all of their shows off of iTunes by the end of the year. What really gets to me, is how senseless the arguments the media companies are raising against Apple. This doesn’t pertain to just NBC, but all media companies dealing with iTunes as a whole.
Think back to when Universal was negotiating with Apple for their new music agreement. Their argument was that they’re not making enough money from iTunes Music Store, they want more control over pricing. Similar arguments has been brought up over the years with Apple multiple times, and they’re all along the lines of more control over DRM, more control over pricing, more profit for the record labels. Time and time again they insist that they can’t make enough money from iTunes Music Store alone.
Yet, look what happened these past few months. EMI started selling DRM-free tracks on iTunes, and doesn’t seem to be hurt by it as much as bolstered by it. All the other studios started offering completely DRM-free tracks on Amazon MP3 that sold for as little as $0.89 per track, depending on albums (although the misconception is all tracks are available at $0.89, they are not. Most out-of-print album tracks are $0.99, similar to how such albums costs more than new releases at record stores). They have agreed to sell less restrictive & less expensive music on Amazon, meanwhile telling Apple this is precisely what they cannot ever afford to do.
Now with this NBC deal, they’re complaining about revenue, about not making enough money. Same arguments as the record labels had with iTunes. At the same time, they’re going to be bringing out their own video service that allows you to watch entire shows for free (albeit with advertisements) and even embed videos on other sites in a very web 2.0-friendly fashion. So now they’re just serving up bandwidth and going back to relying on advertisement-based revenue models. Do they really make that much more money from webcasts compared to selling the shows? I’m sure the studios makes a huge amount of money from DVD sales of TV shows. Meanwhile iTunes’ sheer volume may not be as much as DVD sales now, it is a developing market that will probably grow bigger over time as we steer away from solid-state mediums for media delivery.
Furthermore, NBC’s little tirade about how much they’ve helped the iPod, and how they should get a share of that iPod sales revenue, is utterly ridiculous. Has RCA, Sony, Sharp and other TV manufacturers been sending part of their revenue to television stations? Obviously TV as a delivery medium wouldn’t work without the TV stations. So why isn’t NBC charging TV makers a fee for delivering their shows to millions of homes everyday?
We’ll see how this whole thing plays out. In the end, AmazonMP3 might take over iTunes Music Store, but that’s only because iTMS was there to pave the way first. Maybe Hulu.com will succeed, or maybe it’ll be a massive failure. Whatever happens, the end result probably wouldn’t impact iPod sales a slight bit. After all, no one’s stopped buying TV’s because NBC doesn’t have any interesting shows on Wednesday nights, right?
