On the heels of NBC U’s download deal with SanDisk, we spoke to NBC U president of digital distribution, Jean-Briac “JB” Perrette about what SanDisk offered that iTunes wouldn’t and the prevailing view at NBC U on downloads vs. streaming.
JB on SanDisk’s “Fanfare”:
“Fanfare is going to be an iTunes-like store for us.”
On the pricing issue for downloads:
“It’s normal for content owners to control wholesale the price of their content. This is no different than any other wholesale relationship; it’s not different in that sense than Wal-Mart, which decides to price DVDs at a loss. Ultimately, we still set the wholesale price.”
JB Perrette interview after the jump.
SAI: Where does SanDisk’s Sansa TakeTV and its Fanfare download service fit strategically for NBCU?
JB: Fanfare is going to be an iTunes-like store for us.
Does this solve the Internet-to-TV problem, or is it an interim solution?
Strategically, everyone is fighting like hell to seamlessly integrate Web video to television. The TakeTV version is an analogue solution to a digital problem. At the same time, while people are trying to do this wirelessly and with a broadband connection–this is very simple, very clean. It isn’t the endgame but its a great way for people to port content from the PC to the television.
Will NBCU’s deal support portable devices when Fanfare supports them?
They (SanDisk) are looking to launch Sansa View — an iPod-like portable device for September rollout next year.
How much pricing flexibility will you have with SanDisk’s Fanfare?
The business model is one we like; it’s normal for content owners to control wholesale the price of their content. This is no different than any other wholesale relationship; it’s not different in the sense that WalMart decides to price DVDs at a loss. Ultimately we still set the wholesale price.
You mentioned $0.99 to $3.99 as a price range for TV shows. What other pricing options are you considering?
In 2008 we will look at other options; packaging a couple shows or episodes or some extras and pricing at a premium price offering. Amazon Unbox offers bundles of shows–season passes where the pricing is in the $0.99 range. We want to experiment and see how to make this business scale in a more meaningful way.
And what about copyright protection?
They are working with us on being leaders in the consumer electronics industry on software and on hardware. There will be technology to filter legitimate versus illegitimate content. This is one aspect (Apple) didn’t want to engage us on. [We don’t think we can stop all piracy, but if we don’t try to counter it, it’s a bad sign for us as a company and for the media industry as a whole.]
What’s the prevailing view at NBCU: paid downloads (SanDisk) or free streaming (Hulu)?
The second approach is ad-supported which is more compelling and more scalable. There’s a lot of confusion in the market. People think it’s us throwing spaghetti against the wall. We have two models, one is the retail model (Unbox, Sandisk), and one is the free ad-supported model.
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