iTunes and NBC's views

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At the recent Ad: Tech conference (a digital marketing event) NBC Universal’s chief digital officer, George Kliavkoff, expressed his thoughts on piracy and NBC’s relationship with iTunes.

In regard to piracy, he said (as quoted by CNET):

“If you look at studies about MP3 players, especially leading MP3 players [read: iPod—editor] and what portion of that content is pirated, and think about how that content gets onto that device, it has to go through a gate-keeping piece of software, which would be a convenient place to put some anti-piracy measures. One of the big issues for NBC is piracy. We are financially harmed every day by piracy. It results in us not being able to invest as much money in the next generation of film and TV products.”

And he’s right. Piracy does harm the media companies. However, much like the relationship between Apple and video-centric media companies, this sentiment runs about three years behind the times.

Harken back to what the music companies were saying in 2005. What you heard was copy-protection this, gatekeeper that, and digital rights management the other. The notion was that if you locked down content and punished those who dared distribute it, the days of milk and honey would return to the music industry.

And what a triumph that was.

Listen today and while the RIAA still has a bit of bark left in it, it’s all about stripping music of DRM and finding other financial models for getting music to consumers while getting paid for the trouble. Why? Because anti-piracy measures don’t work.

NBC is working on other means for getting their content to consumers including streaming video from its website and Hulu as well as selling downloadable episodes via Amazon’s Unbox service, but none of these solutions are compatible with today’s most popular portable media player, the iPod. And so you’re back to the same old keening offered by music services that didn’t sell their wares in an iPod-compatible format: If only Apple would open its format or support our just-as-closed format we’d….

Perhaps we could unearth the stinking remains of Virgin and Sony’s online music efforts to see just how well that went.

But let’s assume for the moment that piracy is a red-herring. After all, Apple already locks down video sold at the Store. This stuff is not being distributed on bit-torrent. No, NBC’s real concern remains money. Kliavkoff went on to say:

“We’d love to be on iTunes. It has a great customer experience. We’d love to figure out a way to distribute our content on iTunes.”

Gee, I’d think if you just checked the filing cabinet you’d find Apple’s contact info printed on your previous contract. One call in which you suggested that your decision to leave iTunes was not as clearly thought out as it might have been would probably patch things up nicely.

Clearly NBC still wants control over pricing as evidenced by this statement:

“They can mark up the price and make a profit or use it as a loss leader to get people in the door… It’s really difficult for us to work with any distribution partner who says ‘Here’s the wholesale price and the retail price’ especially when the price doesn’t reflect the full value of the product…. The music industry guys would have something to say about how the pricing has affected their product over the last few years.”

Excuse the familiar tone, but Dude, currently your alternative to selling your programming on iTunes is giving the frickin’ stuff away. Seems to me that the dollars derived from iTunes would amount to a reasonable pool of gravy. And your competitors—none of which have hissy-fitted their way off iTunes—appear to agree.

As for the say of “the music industry guys,” would you care to venture a guess as to where they’d be today without iTunes? Perhaps the memory has been blotted from your mind, but the music companies were losing their shirts thanks to piracy and a general disinterest in new music. Their solution seemed to be to throw a lot of money at lawyers, churn out more of the same unsuccessful cookie-cutter dreck, and sit in their hot-tubs sipping scotch in the hope of dulling dreams of their impending unemployment.

As with the pursuit of copy-protection, as with the idea of tying content to computer screens and portable players that don’t bear the iPod name, this is not somewhere you want to go. You haven’t been able to create a viable alternative to iTunes and there’s no indication that such an alternative is in the works. I understand that losing some control over your content is painful—like the music industry guys, you like owning your content lock, s, and b. But, if you ask those same music guys, they’ll tell you that the world has changed.

Maybe it’s time you changed with it.

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