Sad, Sad News
While looking at various news articles today I came across one where iTunes (Apple) will be dropping sales of NBC shows. This isn’t too bad, in my opinion, especially given that Studio 60 on the Sunset Strip lasted all of one season, I don’t (really) watch a lot of NBC (specific) shows; but I do watch NBC-Universal shows. Specifically, I am pretty well addicted to Psych and Eureka which reside on the USA Network and the SciFi Channel, respectively. Both of these channels (cable or satellite subscription required) are owned by NBC-Universal and the method for watching them is not to anxiously wait in front of the TV until they are broadcast, I am far too busy a person for that, but rather to pay for and download them via iTunes; then plugging in my iPod in to the television and watching the shows that way.
iTunes will stop selling NBC related shows in the fall of this year (2007), and the contract Apple has with NBC will expire at the end of December 2007.
The reason for this change is because NBC wants iTunes to charge a lot more money per episode download than they are currently charging. NBC, of late, has reached an all-time low of 4th place in the network race, being beaten by (in no particular order) ABC, CBS, and FOX. Not too long ago, NBC was at the top of the heap. They owned Thursday night, they were the network everyone was trying to keep up with… and now, they are declining and fast.
What gets me, here, is not that NBC is on the downward spiral, it happens. A couple of years ago, ABC was the bottom of the top four heap (apparently, the WB and Paramount network, now the CW are not real competitors along with PBS and other broadcast networks) until ABC came up with a powerhouse combination of Lost, Desperate Housewives, and Grey’s Anatomy. Since then, ABC has been able to create show after show that gets viewers attention and keeps it.
NBC does not.
NBC’s shows that I pay attention to are not even on their flagship network. Rather, they show on cable. I get cable. I can actually, if I had the time, watch one of the shows when it is shown (Friday nights, by the by); but I don’t have the time, AND I don’t want to make a special time slot simply because the show is airing. I would rather download it.
This does not mean that NBC and Apple’s little tiff over cost and money is going to cause me to become a rabid supporter of either side. I like Apple because through iTunes they help control a market that I believe needs better money management. A lot of the suppliers of music and media want Apple to raise prices. They see success and then want to raise the price of that success; Apple has refused realizing they are on top of a good thing. If they raise prices, then the outcome will be that they will lose customers to competitors who are forced to charge the same prices.
I also understand NBC wanting to make up revenue on the front end for shows that are being downloaded. With that said, though, I have a top-end price I am willing to spend on downloaded TV shows given that I only pay for downloads of shows I also intend to purchase on DVD. If the total cost-per-download is equal-to or less-than what I can expect to pay for the DVD’s when they come out, I am good with that. On the flipside, though, when the cost-per-download goes far in excess of the cost of the DVD’s when they come out I am less willing to purchase. What will happen, for me, is I will save my money and purchase the DVD’s, watching the show when I can put a disk in my machine rather than plugging my iPod in to the TV and watching.
When it comes to both Eureka and Psych I intend to own the DVD’s. I also have the seasons available to my iPod. The cost of downloading, both, is less than what I can expect to pay for the DVD’s when they are released. The same is true of the other show (singular) that I currently download. It is not an NBC property. However, if NBC thinks that its customers (me in particular) who use iTunes as a way of keeping up with different shows (last season Studio 60 on the Sunset Strip and The Black Donnelly’s were shows I followed almost exclusively through downloads) then they are seriously, seriously, SERIOUSLY mistaken. I am not going to get iTunes to change their policy. In the long run, it saves me money. By not buying downloads I get to wait longer for the shows to arrive on DVD, but at the same time, I don’t have the extra expense of downloading them.
Truth told, I think that NBC will realize this is a poor business decision. In the long run, I think that NBC will decide to allow Apple to set the pricing guidelines for downloadable shows. In the long run, I think that Apple has the better business model and will win out over competitors. However, in the long run I could be entirely wrong. Neither the convenience of downloading television or music or watching those downloads at my convenience is enough to get me to pay more money to purchase through iTunes and NBC is foolish to think that the consumer will side with them.
I believe that NBC is shooting itself in the foot and the winner here will be the consumer.
Go Apple.
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