How Robert Iger Pissed Off Everyone So Quickly

from the that-takes-talent dept

Robert Iger only took over Disney recently and he's already managed quite a feat: pissing off just about everyone in Hollywood. While he restored Disney's relationship with Steve Jobs by agreeing to offer downloadable TV shows, we noted that this caught all the ABC affiliates by surprise, and they freaked out at the thought people might just download the shows instead of watching them on TV (despite, of course, the cost advantage to watching them or recording them off the TV). Turns out it wasn't just the affiliates that Iger forgot to let in on the secret. Actors, writers and directors are all up in arms and are collectively demanding that they get a piece of every $1.99 for every TV show sold through iTunes. In other words, even if Apple is actually making any money at $2/show, it's unlikely to last very long. Of course, all this means is that the price will get driven up, and people will say it's not worth it when they can record it or download it for free from elsewhere.

Reader Comments (rss)

(Flattened / Threaded)

  1. identicon
    Jimi Spier, Oct 14th, 2005 @ 10:56pm

    We nerds are junkies..

    We geeks are like any crackhead out there. If we can't get our fix for a cheap price, we'll just get it for free by stealing it.. Disney, ABC, etc. its up to you whether or not you want to make any profit at all. I can go either way on the issue, sell it for cheap or I'll get it for free, the ball is in your court..

    reply to this | link to this | view in thread ]

  2. identicon
    Anonymous Coward, Oct 15th, 2005 @ 2:42am

    No Subject Given

    Perhaps that was the aim of Apple all along - to show what consumers are willing to pay for content.

    reply to this | link to this | view in thread ]

  3. identicon
    tvnetdude, Oct 15th, 2005 @ 4:54am

    Re: No Subject Given

    Paying for content is everyone's goal. If they could, they would eliminate terrestrial TV and radio.

    If this ever happens, which direction do you think prices in an unregulated industry will go up or down?

    reply to this | link to this | view in thread ]

  4. identicon
    Deva, Oct 15th, 2005 @ 7:06am

    Re: Heinz Baked Beans

    Paid content might make a profit for the distributors, but ad money, which is probably much more, will always be more important to them, I think. Paying for content seems to be a pretty shallow goal, considering the benefits of having masses of people directed to purchase things. We geeks have been away from ads for too long :)

    Also, most people like to have their content fed to them, instead of clicking around for it and giving their credit card numbers to the magical compooter machine, so I don't think we should be taking the geek viewpoint too seriously anyway - This kind of content is targeted towards completely different audiences

    reply to this | link to this | view in thread ]

  5. identicon
    JosephH, Oct 15th, 2005 @ 9:25am

    No Subject Given

    What? How do you know that Apple wouldn't make money if the writers, actors and directors got some of it? Apple fanboy much?

    reply to this | link to this | view in thread ]

  6. identicon
    Aleks Y., Oct 15th, 2005 @ 10:57am

    That would be just right!

    Ofcourse $1.99 per show isn't that bad if you're rich and don't know where else to get it for free or don't have the time to tape it from TV. My boss downloads $.99 a song from Itunes, simply because he doesn't know that his CD collection can be turned into mp3 galore within 3 or 4 hours. $1.99 a show isn't a bad idea, especially if you're into those shows and you really hate to sit enfront of tv and watch it, you can just watch it on the train. Great stuff. But nevertheless, once everyone who was watching those shows on tv starts downloading them - there goes the neighborhood. Kiss $1.99 goodbye.

    reply to this | link to this | view in thread ]

  7. identicon
    Jason SJOBECK, Oct 15th, 2005 @ 7:03pm

    Re: No Subject Given

    Never happen. They know that they can reach a multiple more people by giving the terrestial broadcast away. If they took it away, their ad' revenue would disappear & they would be done.

    reply to this | link to this | view in thread ]

  8. identicon
    harry, Oct 15th, 2005 @ 10:39pm

    Do the math, not so bad

    The Math is even better..

    Most TV ads cost $10 to $20 per 1000 viewers. Superbowl ads are cheaper, some top top show much more. Let's use $20 as the example here.

    That means each ad shown to the total # of viewers as estimated by Neilson. 5 people @ one house watching would count 5 times. We will assume since the Ipod is a personal device, one viewer.

    That means each ad costs 2 cents ($20 / 1000). Assuming there are 40 ads per show, you get 80 cents per show in ad income. So for $1.99 there is plenty of room to pay all the actors and everyone else all of their normal fees. [The point is that the amount of $$ per show generated PER viewer is small and easily covered by Apple's fee!]

    A 1/2 hour show would have less than 40 ads (typically ads can be 60 sec, 30 secs, 20 sec and even 5; i'm just using average prices. A 20 sec ad costs less than a 60 second one, of course.)

    reply to this | link to this | view in thread ]

  9. identicon
    joe, Oct 16th, 2005 @ 3:31pm

    Re: Do the math, not so bad

    Superbowl ads are more expensive.

    reply to this | link to this | view in thread ]

  10. identicon
    Anonymous Coward, Oct 16th, 2005 @ 4:46pm

    Re: Do the math, not so bad

    No, you are wrong. They are less expensive.

    Its less because you are payting a million dollars for 1 30 secd spot that has VASTLY more viewers than the average television show. It ends up being somewhere around $10-$15 per thousand ather than $15-$20

    reply to this | link to this | view in thread ]

  11. identicon
    DMA, Oct 16th, 2005 @ 5:29pm

    Income-to-quality will drive price

    I think the demand will boil down to a quality/price ratio, if the ad revenue allows the quality to create demand, ad-driven product will survive. If the pay-per model can produce the revenue to produce acceptable quality to produce more demand than the ad-driven product, it will win. I think assuming the model in and of itself will drive demand is short-sighted, the product-to-price acceptance will drive demand, and the model that produces the acceptable ratio will survive.

    reply to this | link to this | view in thread ]

  12. identicon
    anonymoustroll, Oct 16th, 2005 @ 5:33pm

    Re: Do the math, not so bad

    Uh, actually if you look at it from an "area under the curve" prospective, Superbole ads are more expensive. Most ad campaigns require reptition to be effective. It's a multi-dimensional, stochastic psychology problem, so just about any "answer" can be defined as correct

    reply to this | link to this | view in thread ]

  13. identicon
    Anonymous Coward, Oct 16th, 2005 @ 8:19pm

    anonymous coward

    exactly. this is just an experiment. insofar as the actors go, they may be surprised to know that the producers are selling DVD's of their shows too! Same principle, just another format. And the value of .h264 at 320x240 has got to be much lower than 1080i DVD.

    reply to this | link to this | view in thread ]

  14. icon
    MadJo (profile), Oct 17th, 2005 @ 12:53am

    Re: Do the math, not so bad

    But would you be willing to pay $1.99 for an ad-ridden episode of whatever program on your iPod? :)

    reply to this | link to this | view in thread ]

  15. identicon
    Pete Austin, Oct 17th, 2005 @ 2:23am

    Newspapers give away DVDs

    ...with the UK Sunday editions. A paper costs 1-2 ($1-$2 allowing for cheaper American prices) so I think this shows the fair price for DVDs. At $1.99 in low resolution with DRM, Apple sounds a bit expensive.

    reply to this | link to this | view in thread ]

  16. identicon
    richard, Oct 17th, 2005 @ 10:12am

    Re: Do the math, not so bad

    The episodes on iTunes right now are commercial free.

    reply to this | link to this | view in thread ]

  17. identicon
    crystalattice, Oct 17th, 2005 @ 11:59am

    I thought they already got paid.

    Don't all those people already get royalties based on reruns and other broadcasts? Then they should already be getting the money for these shows. If Apple is paying for the rights to use the programs in iTunes, then ABC et al. are getting their fair share; it's up then up to ABC to pay the royalties out of the money they've already received. Apple shouldn't be bothered by the unions and guilds since it's not their responsiblity.

    reply to this | link to this | view in thread ]

  18. identicon
    Tam, Oct 11th, 2006 @ 10:43pm

    Re: Re: Do the math, not so bad

    Could you explain stochastic psychology to me? I've just come across it, and i'm interested.... I can't find much on the internet outside of math and computational analysis... so you're it! Tell me what it's all about....

    reply to this | link to this | view in thread ]

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