NBC Universal Now Says It Should Be Apple's Responsibility To Stop Piracy

from the oh-please dept

Sometimes you wonder how the folks at NBC Universal get anything accomplished, when they seem totally unable to accept responsibility for the market challenges they face, and demand that everyone else fix NBC Universal's business model problems. Remember, NBC Universal has been the main supporter of the idea that ISPs should be responsible for stopping any unauthorized transfer of content. But why take chances on having just one outside party prop up your business model?

Now, NBC Universal's "chief digital officer," George Kliavkoff, is saying that it should be Apple's responsibility to stop unauthorized usage by building special antipiracy filters into iTunes. Yes, iTunes -- the service that plenty of people use in order to legally purchase content. However, since iTunes is also the connection that most people use to manage their iPod content, NBC Universal thinks Apple should somehow block the ability to get non-authorized material onto the iPod. How would they do that? How would they know that a song is authorized vs. legally ripped? Don't bother asking tough questions like that. After all, if NBC Universal actually knew how to answer them, it wouldn't be telling everyone else that they're required to fix NBC Universal's broken business model. And, of course, it apparently hasn't occurred to NBC Universal execs that if Apple actually agreed to this (which seems extremely unlikely), it would just push people to jump to other solutions to manage their music, such as Songbird.

Kliavkoff then goes on to say: "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." Note the careful choice of words here. Remember, we were just discussing how the entertainment industry is trying to appropriate all value that is associated with content (even if that value is because of some other vehicle) back to the content owner. Kliavkoff's statement also shows a confusion over the difference between price and value -- and because of that he seems to be assigning all the value to the content and almost none to the service and technology Apple provides (sound familiar?). Coming from a "chief digital officer" that seems troublesome for the company's digital strategies. Then again, perhaps it shouldn't be a surprise. Companies that have a "chief digital officer" are already in trouble because they're sectioning off "digital" as if it's some separate function, rather than a key component that will impact all aspects of the business.

Filed Under: blame, business models, economics, itunes, piracy, responsibility
Companies: apple, nbc universal


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  1. identicon
    DanC, 17 Apr 2008 @ 1:00pm

    Re: Pricing

    Well, IMHO they have a point, in that in nearly every other industry the publisher or manufacturer sets the wholesale price

    They had every opportunity to set their own prices when they were trying to set up their own distribution services. If they want access to iTunes customers, for better or worse they have to play by Apple's rules. The standardized pricing and relaxed DRM were set up to eliminate the two main factors that caused the recording industries previous online efforts to fail. The fact that those are the two things NBC is complaining about should tell you that content providers still haven't learned their lesson.

    The content producers are still perfectly capable of setting their own pricing. All they have to do start their own music service and potentially lose their built-in iTunes customer base if they implement DRM. They're also going to have to fight against the customers' now built-in expectations of pricing.

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