In yesterday’s Variety.com technology section they have an interview with NBC Universal head Jeff Zucker and it shed light on some of the reasons Apple and NBC will no longer be working together.
1. “We wanted to take one show, it didn’t matter which one it was, and experiment and sell it for $2.99,” he said. “We made that offer for months and they said no.” This is not quite the $4.99 that Apple stated they wanted but clearly shows that NBC wanted to make the good shows more expensive that the bad ones. Heroes was the show in question.
2. In lieu of more flexibility on pricing, NBC U sought a cut of Apple’s hardware sales.
“Apple sold millions of dollars worth of hardware off the back of our content, and made a lot of money,” Zucker said. “They did not want to share in what they were making off the hardware or allow us to adjust pricing.” I suppose they want money from the CD makers and the HD and Blue Ray guys as well. This could possibly one of the most ridiculous things he’s said yet. Before iPod there were four choices. Watch it for free, tape it for free, download it for free, or buy the DVD. Apple gave them one more revenue source they didn’t have even if it was only $15 million as they say.
3. NBC Universal programming accounted for 40% of iTunes’ video sales. Apple said 30%. It’s a big chunk of Apple’s sales but Apple doesn’t seem too worried or there would have been some sort of concessions.
4. Zucker’s comments came on the day of the beta launch of Hulu.com, NBC U and News Corp.’s joint venture that aims to compete with iTunes for whatever online demand exists for studio-produced TV and films online. People don’t want to watch TV on their computers. Not yet at least. Short clips and user generated shorts are huge because we only have the attention span of a few minutes in front of a computer when it comes to video. I don’t see Hulu.com being a huge success……….. Unless you can download it to your iPod or iPhone.
5. Zucker argued that the 50 million streams of TV shows that had been accessed on NBC.com during the month of October prove there is a demand for traditional TV series on the Web. As long as it’s free sure. You were getting $2 bucks a piece at Apple. There were billions of streams of TV on bittorent. That doesn’t prove want of anything. If snickers were free at the convenient store and all the rest of the candy bars cost .75 cents. Guess what is the most popular candy bar in America this year?
6. On Fox’s New Business Channel: CNBC is a very serious-minded financial news network, and what we’ve seen thus far from Fox appears to be not as investment-focused or financially focused, and that’s good for us,” he said. “From a performance standpoint, it has had no impact (on ratings) over the last few weeks.” I agree right now but I remember people talking about Fox TV in the same way the first few years.
It seems to me the Zucker is stepping on a dollar to pick up a dime. In my view he hasn’t said one thing the supports his reasoning for leaving Apple, other than to leave and form hulu which ironically they started with News Corp which owns the Fox Business channel he so lightly bashed.