It takes a short guy to admit a big mistake. Or a big ego to declare a small victory. But the fact is that Jeff Zucker went off on Steve Jobs and severed NBC Universal’s relationship with iTunes a year ago. NBC Universal had been iTunes’s No. 1 seller even if Zucker boasted back then that NBC wasn’t getting all that much dough from the deal. But Zucker’s backing out of renewing its contract with Apple over disputes on pricing, bundling content together, and more restrictive DRM was still a pinhead move. Not only did NBC execs admit that The Office got a big awareness boost when because of iTunes, but they missed not having iTunes as another marketing platform to promote the 2007-2008 fall season which ended up dying. And then Zucker added insult to injury by claiming Apple and iTunes had “destroyed the music business” in terms of pricing and that video was next unless “we take control”. Back in January, there were hints of a rapprochement after Universal inked a movie rental deal with iTunes and Zucker did a 180. “We’ve said all along that we admire Apple, that we want to be in business with Apple,” Zucker told the press. “We’re great fans of Steve Jobs.” Jobs praised NBC Uni, too.
Now all is forgiven and NBC is back on iTunes with its lineup of TV shows. Jobs announced today that The Office, Heroes, Monk, Battlestar Galactica, 30 Rock, etc. will all be sold. HD versions will run $2.99 while SD versions will go for $1.99 andother stuff for $.99. Even so, Zucker couldn’t leave well enough alone. He had to go on his lapdog CNBC and claim victory for getting variable pricing while at the same time admitting that the shows must be available on as many platforms as possible. (“Short term pain for long term gain,” his mouthpiece kept repeating to me just now.) How this will cannibalize NBC’s much hyped Hulu is anybody’s guess. What’s next — SNL clips back on YouTube?
Editor-in-Chief Nikki Finke - tip her here.


Anything that screws the writer out of a decent residual I(and let’s not even discuss the DVD thing) rate has got to be good for NBC and bad for the writer. But, whatever, this is what we fought so long and hard to achieve. Thanks Patric.
These media guys just don’t get it. Apple does all the work and mails you a check for 90% of the download fee, and it’s not enough for these guys. They want the charges to be higher than most people would be willing to pay.
The recording industry is in the retail business, and it just can’t see how it’s going to make their money in the digital world except by selling little plastic disks to people.
A wiser man with a once mega-powerful network sinking all around him put the phrase: “We take control” completely out of his lexicon.
He also made a huge tactical mistake by making this little mini-feud so public. A CEO can’t just grab his ball and scream “I’m going home!” because he doesn’t like the game. He has to be smart, learn everything he can about the playground, and either find out how to get his way within the existing game or develop an all new game with all new rules that everyone will want to play.
Returning now after all the melodrama is a rather big dinner of crow for someone who is supposed to be so powerful.
He really doesn’t know what he’s doing.
Zucker is clueless as to how much trouble his company is in. Viewers have desereted his news division becouse they’ve gone left wing; the assaults of Gov Sarah Palin have only done more harm than good. MSNBC had a blow up with Chris Matthews and Keith Oberman who tried to be anchors and now they’re banned from election coverage. MSNBC problems are coming to the surface…
I wonder how Zucker is taking the Leno jokes from the tonight show?
Here is the bottom line: NBC’s SEASON suffered last year. That is at least partly attributed to not being on iTunes. And while profits for Studios from iTunes are not CURRENTLY anything that warrants a second glance, fast forward a few years when 50 million or more Americans have iPhones or iPod touches… This landscape is changing fast, and NBC knows it.
Let’s recap last year, shall we? Jeff Zucker made a complete IDIOT of himself when he threatened (unfortunately for NBC, very publicly) to remove all NBC content from iTunes by the end of the year. Apple, instead of cowering in dismay, did Mr. Zucker one better: They immediately and unceremoniously removed all NBC content post haste (Early Sept. 07).
Here is the word on the street: Apple made the decision to completely ban NBC content from the iTunes store for a period of exactly one year. That is why even though Apple and NBC appeared to “make nice” in January, you haven’t seen NBC content back on iTunes until now (Early Sept. 08).
Apple approached this issue in this way in order to send a message to the other networks that might be contemplating doing the same. “You’re free to leave whenever you want, but chose wisely, because it isn’t so easy to come back once you decide you want back on the gravy train.”
Apple’s financial reports never registered even the slightest blip from a missing NBC over the last 12 months. In fact, their growth has been unprecedented and their profits have been Apple’s largest in history.
NBC made a massive miscalculation. End of story.
“I’m not sure that we’d still have the show on the air” without the iTunes boost, says Angela Bromstead, president of NBC Universal Television Studio, which owns and produces “The Office.” “The network had only ordered so many episodes, but when it went on iTunes and really started taking off, that gave us another way to see the true potential other than just Nielsen. It just kind of happened at a great time.”
Quoted from Summer 2007
Yup, hulu is doing sooo great that NBCU NEEDS to get back on iTunes. If I was a shareholder I would want to know how much revenue was lost due to this putz.
Zucker has no clue what he is doing. Don’t make Apple mad. It’s not wise. I’m sure after Zucker is dismissed from NBC he’ll sign a lucrative producing deal. The failing upwards prophecy lives.
By the way, did I see Ben Silverman on Entourage a few days ago. Maybe ZUCKER will make an appearance on THE BIGGEST LOSER…..or DEAL OR NO DEAL, holding a briefcase of course.
As usual Nikki, after reading all the other coverage about this, only *you* have the proper perspective and it’s only *you* who is worth quoting:
http://mikecane2008.wordpress.com/2008/09/09/nikki-finke-knows-the-apple-nbc-score/
Hulu is doing so good that FOX is posting clips of its most popular shows on You Tube. If that site had been doing great, Apple and iTunes would be down in the dumps. Instead Jeff Zucker makes a decision so bad that it would make Michael Scott’s bad decisions look wonderful by comparison. Jeffy buddy, enjoy your super size order of crow.
It’s a year NBC and Zucker will never get back.
Time as a Network or Studio Chief is precious and shouldn’t be wasted.
Chuck, you’re way off base on the Palin stuff, for two primary reasons: MSNBC didn’t “attack” her, and that network is enjoying its highest ratings ever. The bigger point, though, is that the entire entertainment division (and most prominently, NBC) is in trouble.
Chuck is partially right. There is trouble at NBC News and MSNBC, but ratings are up thanks to interest in the election. The problem is that CNN’s and Fox News’s ratings are up as well. Add in the bickering on set and it is no wonder why NBC is in trouble, and that is just the news division.
As for Sarah Palin, it is the tabloid media that is attacking her though Barack Obama referred to her as a pig with lipstick within the last 12 hours. Now you don’t smear an opponent unless you have concrete evidence like a recent blunder by McCain in which he doesn’t remember how many houses he owns though at least 70 of them might be in foreclosure.
It’s not just the tabloid media that has attempted to Vilified Sarah Palin. In fact leftie talk show host Ed Schultz is doing it for yesterday he attacked her religon. Jan Wenner who owns Us Magazine has lost a huge number of readers becouse the tabloid headline last week. And Bradly Jacobs got what deserve from Megyn Kelly of Fox News.
Now what got Keith Oberman in trouble at the RNC convention was a statement he made about Sept 11th. More has emerge too that both parties have criticized MSNMC. Tom Brokaw I’m pleased to say flex his muscles over Overman. But the story is getting around the web and Bill O’Reilly has pointed the finger at Zucker and Capus. It’s dubbed Media corruption and even Lou Dobbs called it on his network and others. NBC needs to remove this idealogue culture it has set itself in; becouse the veiwer isn’t stupid. Nor is the viewer.
>>>Barack Obama referred to her as a pig with lipstick
Are you kidding? Tell me you’re kidding.
Here are examples of that idiom in common usage, NONE of which apply to Sarah frikkin Palin:
http://www.palminfocenter.com/comments/8546/#137058
http://www.palminfocenter.com/comments/7899/#141532
http://www.palminfocenter.com/comments/8745/#137550
And that’s just three. Now just because YOU are ignorant of the idiom being in common use, stop trying to imagine everyone else is an outright eejit too.
So what exactly does Zucker have to show for NBC Universal that they wouldn’t have had if they’d never pulled their shows from iTunes a year ago?
Nothing – except for millions of dollars in lost revenue.
Some victory.
Now you don’t smear an opponent unless you have concrete evidence
That’s funny, Jessy S. You smear Obama w/o factual basis, and in the same breath complain about Obama smearing palin.
the Lipstick comment was referring to McCain’s attempt at policy, go watch it, it’s all over youtube…
You all are delusional. No one makes much off of iTunes. Video sales at iTunes were no more than $200 million in 2007. The studios get 70% of that, not 90%, and then you have to subtract tech costs and residuals. NBC’s share was maybe 40% of iTunes at the time they bolted. I doubt NBC made $50 million from iTunes the year it bolted. In fact, I think Zucker said they made $15 million. Compared to what they make off ad revenue, syndication, and TV DVD, it’s nothing.
The Office was an aberration and it’s doubtful it even had the impact on tipping the show that people think it did. I imagine maybe 200K people would download a typical Office episode in its early days, a good chunk of whom were already watching the show anyway. And that was before ad-supported streaming at NBC.com and later Hulu were in place. 80%-90% will opt for free ad-supported streaming over paying $1.99 for an episode iTunes.
NBC knew what it was doing.
Zucker folded like a cheap umbrella. Does anyone believe his claims of victory?
And shut up with the Palin nonsense already, it has zero to do with this and people are sick of hearing about her. It’s bad enough on political sites without people trying to turn this into a political soapbox as well.