NBC-U Jeff Zucker is now mad people consider him and his Hulu venture idiotic so he is trying to talk as if he actually understands digital and the television business going forward.
He now claims that $15 million from NBC iTunes sales is not enough for him.
Nevermind that is 7.5 million impressions of NBC shows … or that 7.5 million people were willing to pay for it instead of downloading it for free … instead, Zucker’s very confused.
The bottom line is he wanted to raise prices and Apple did not – no biggie, that’s a business decision, right or wrong – that is his right as the guy NBC/GE’s board decided to hand the major decision making to – they have appointed him as the brains of the operation.
But instead, he tries to open other areas of discussion that he is clearly not qualified to discuss.
He babbles about Apple controllling distribution. At no point has anyone ever raised the issue about exclusive content – so how exactly is Apple controlling distribution when previous and going forward, NBC can sell their shows in every format including on their own website. The only distribution point Apple controls is iPod distribution … network TV, DVD retail, other internet venues, VOD, etc, etc … all NBC – what exactly is the problem with another distribution point? Most companies consider a NEW distribution a good thing (see, Zucker, how this works, if another store can sell your thing, you make more money).
He also talks about wanting to get iPod revenue because clearly we’re buying iPods to watch NBC shows … uh, sure – even if that were remotely true … shouldn’t then the auto makers pay Goodyear because cars without tires aren’t much fun? Or hey, is NBC paying us to use OUR airwaves? What is Zucker’s position on that issue?
So, he’s mad that Apple is not willing to raise prices and has only added $15 million to NBC-U coffers … so he picks a fight with Apple that he clearly doesn’t understand. What is the alternative to $15 million from Apple?
At what cost to sell at Apple iTunes? Practically nothing – how much is to digitize a show to load onto a jukebox that you NEVER have to reload – that requires no real maintance on your part? Apple handles EVERYTHING else?
If you sell a series on DVD, you have to project how many you can reasonable sell and that retailers will order – convert the series to DVD format, create a menu, design jewel case artwork and box, get it manufacturered, shipped and have provisions for returns and damaged discs.
Which is simpler?
So, instead of having yet another format for consumers … another $15 million (even presuming that iTunes sales do not grow) from a different non-exclusive source, he choose to walk away from that …
But that’s not enough for him – instead he thinks he can launch another YouTube.
So, it’s not just good enough to subtract $15 million from revenue but let’s spend how many hundreds of millions to launch a YouTube 1.1?
They already have 100 employees for a site months away from launch … it takes most startups years to pass 100 employees.
I don’t know YOUTUBE’s headcount now but I’m sure before the Google buyout, they were under 100 …
Zucker seems confused about how a startup works.
Of course, GE doesn’t seem to mind he still doesn’t understand anything – GE & Zucker a few years ago paid $600 million for iVillage.com, launched a TV show to promote it and have thrown in hundreds of millions of free promotional spots in order to grow the page views … so far, no real growth at iVillage with some reports that the other massive women’s site has surpassed them. The TV show flopped.
Again, it’s fine to launch new business ventures – no real problem with that but why roil the waters by trying to annoy Apple? Why give up $15 million dollars in revenue for no apparent reason? Did Apple say NBC couldn’t launch streaming on nbc.com or hulu?
Zucker seems to think it’s an either or proposition?
He can’t conceive that some people might prefer to get a show commercial free? AND willing to pay for it? (nevermind the promotional value of people who actually want to watch a show?)
He can’t do a new business unless he walks away from something?
Can he multi-task?
What’s next? Because Zucker doesn’t control DVD pricing at WM or Best Buy – only sell DVD’s at NBC.com?
The bottom line is instead of a steady stream of revenue, he’d rather hire hundreds and spend hundreds of millions to launch Hulu … spending billions to make millions? That doesn’t sound like GE, sounds more like a certain company in Redmond …