Tuesday, October 30, 2007

"NBC Exec: "Apple Has Destroyed the Music Business"

from blog.wired.com - By Terrence Russell

NBC Exec Voices More Beef With iTunes Pricing

 We thought it was video who killed the radio star, but NBC Universal president Jeff Zucker claims that Apple killed both. While being interviewed by The New Yorker's Ken Auletta at a benefit for Syracuse University, the executive claimed that Apple has made millions on its iPod "off the backs of our content" and that the software maker "destroyed the music business in terms of pricing."

The unveiling of Hulu probably contributed to Zucker's overall sauciness, but the true crux was the broadcaster's bitter pricing battle with Apple. "We wanted to take one show, it didn't matter which one it was, and experiment and sell it for $2.99," Zucker said. "We made that offer for months and they said no." NBC's proposed bump in pricing would come out to $1 more than what iTunes users currently pay across the site for video.

But for Zucker, this is all apparently about losing ground. "We don't want to replace the dollars we were making in the analog world with pennies on the digital side," he told the assembled crowd.

It's not unreasonable for NBC to want some sort of control over the pricing of its content. . .but it's unlikely that a price increase would've thrilled many. According to Zucker, the broadcaster netted roughly $15 million last year from iTunes downloads -- and that figure accounts for 40 percent of the site's overall video downloads. With such a low yield, perhaps the perpetually irritable broadcaster made the right choice in striking out on its own. We'll see how things turn out when its download/purchase platform NBC Direct launches soo.


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