Thursday, April 17, 2008, 02:00 pm PT (05:00 pm ET)
NBC's iTunes return may hinge on offline piracy filteringNBC made it clear this week that it would like to resume selling its television programming through the iTunes Store, but only if Apple makes changes to its client software that would allow it to serve as the gatekeeper for all forms of potentially pirated media.
George Kliavkoff, chief digital officer at NBC Universal, made the assertion during an on-stage interview at the Ad:Tech conference in San Francisco this week, in which he didn't specifically call out the iPod maker and iTunes operator by name.
"If you look at studies about MP3 players, especially leading MP3 players and what portion of that content is pirated, and think about how that content gets onto that device, it has to go through a gatekeeping piece of software, which would be a convenient place to put some antipiracy measures," he said "One of the big issues for NBC is piracy. We are financially harmed every day by piracy."
Since Apple already embeds digital rights management (DRM) software within each audio and video file it sells, it appears that Kliavkoff is requesting that the company go a step further and police every piece of digital media a user imports into his or her iTunes library, regardless of its origin.
Oddly, when NBC Universal yanked its TV shows from iTunes last fall, the primary issue was reported to be pricing, not piracy. It's now clear, however, the television studio is seeking concessions in both areas.
"We'd love to be on iTunes. It has a great customer experience," Kliavkoff said. "We'd love to figure out a way to distribute our content on iTunes."
In addition to the added anti-piracy measures, NBC wants the right to determine the cost Apple pays for its programming, not the other way around.
"They can mark up the price and make a profit or use it as a loss leader to get people in the door," Kliavkoff said. "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."
Prior to the fallout between the two parties, NBC supplied the iTunes Store with over 1,500 hours of programming that accounted for more than 30 percent of the service's television show revenues, including three of the 10 best selling shows during the summer season.
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