NBCU will stop selling its tv shows at Apple’s iTunes store, the NYT reports. After the companies’ current deal ends in December, Jeff Zucker will walk away from iTunes, where his stuff accounts for 40% of all digital video sales.
UPDATE: Apple retaliates this morning by announcing that it won’t be selling any new NBC shows this fall, and places the blame squarely on NBC. It says Zucker and company wanted to double the wholesale price for their shows, which would raise the retail price from $1.99 to $4.99 per episode. Apple also says that NBC accounted for just a mere 30% of its tv sales. Meow!
NBC is the second big media player to butt heads publicly with Apple. Last spring Universal Music, the world’s biggest music company, didn’t renew its deal with iTunes, but it still continues to sell there on an at will basis. Universal has since fired a few more shots at Apple: This month it announced plans to sell DRM-free music just about everywhere on the Web except for iTunes. And it isn’t playing along with Apple’s plans to offer iPhone ringtones.
Zucker’s move will get lots of attaboys from his Hollywood pals, who worry that Steve Jobs will end up with as much control over their business as he does with music. And if Hollywood is going to stand up to Apple, now is the time to do it: It hasn’t suffered the same kind of slump that music has endured for the last seven years, and it hasn’t become dependent on digital revenue yet. There’s still opportunity to play around with different formats, pricing, and distributors.
And while we’ve heaped plenty of grief on Hulu, the video site NBCU is preparing to launch with News Corp., this move does underscore one of the JV’s best selling points — just the thought of its existence gives Zucker and Rupert Murdoch more leverage when negotiating with the likes of Apple and Google.