NBC pulls its TV shows from Apple iTunes
No more ad-free episodes of The Office, 30 Rock, Scrubs or Friday Night Lights for $1.99 each. — As promised, NBC (GE) removed all its content and that of its affiliates from the iTunes Store over the weekend after its contract with Apple (AAPL) expired.
Context & Ripple Effects
The removal is the endgame of a dispute that has been running since late summer: Apple announced in August it would stop selling NBC shows when the contract lapsed, and NBC Universal publicly denied asking Apple to double the wholesale price while confirming the shows would stay up only through early December (NBCU's own response). In September NBC lined up its alternative, signing with Amazon's download service.
The timing is awkward for both sides: on the very weekend NBC's catalog left the store, syndicated reports have News Corp's Fox closing in on an iTunes movies deal — meaning Apple is losing its highest-rated TV supplier even as another major studio deepens its commitment. Fox had already been experimenting with ways to court the iPod audience back in September.
First-order effects
- iTunes customers immediately lose $1.99 ad-free downloads of NBC's top properties — The Office, 30 Rock, Scrubs, Friday Night Lights plus Bravo, CNBC, USA Network and Telemundo content — leaving a visible hole in Apple's TV catalog during holiday-season gifting.
- NBC loses direct access to the iPod/iTunes installed base at the moment of peak seasonal device sales, betting those buyers will follow to Amazon instead.
Second-order effects
- Fox and News Corp are positioned to capture shelf space and negotiating attention at Apple that NBC vacates, with an iTunes movies deal reportedly near — Apple can demonstrate it has willing studio partners without conceding on pricing.
- Amazon becomes the credible second channel for network TV downloads, giving other networks a fallback that weakens Apple's hold-the-line position in future contract talks.
Third-order effects
- If NBC's walk-away holds, the era of iTunes as the default single storefront for TV is ending: networks are learning they can fragment distribution across Amazon, hardware makers' services and their own channels rather than accept one retailer's fixed per-episode price.
- A multi-retailer market forces per-show and per-platform pricing experiments, shifting leverage in content licensing from the dominant distributor toward the studios — though whether audiences will chase shows across stores is the open question this standoff turns on.
The trend: Television networks are testing collective leverage against Apple's uniform $1.99 pricing by pulling catalogs and spreading digital distribution across competing retailers.