NBC WILL SELL TV SHOWS ON AMAZON'S UNBOX (BW)

By Nancy Vialatte

Just days after NBC Universal said it would not renew its contract with iTunes unless the online distributor agreed to new pricing options and tighter piracy controls, the conglom has said it will sell episodes of its new fall television shows and other programs through Amazon.com Inc.'s Unbox digital-download store.

The agreement with Unbox will offer such shows as "Heroes," "The Office" and "30 Rock" for $1.99 an episode, the same price iTunes charges. Unbox also will bundle shows and offer discounts on full seasons, an option Apple wouldn't provide, notes the Wall Street Journal.

Starting on Monday, downloads of the pilots of NBC's new shows will be available from Unbox for free before their television premieres.

In response to NBC�s decision not to renew its contract with iTunes, Apple said last week it wouldn't sell NBC's new shows this fall. It will continue, however, to sell existing shows through the end of the year.

Apple said it had refused NBC demands that Apple pay more than double the wholesale price for each NBC television episode on iTunes. NBC denied that, saying "our negotiations were centered on our request for flexibility in wholesale pricing." (WSJ)

The economic impact of the moves is likely to be minimal, but there is symbolic importance as the broadcast networks struggle to take advantage of the Internet and still exert negotiating clout with their Web partners. NBC's content accounts for approximately 30% of iTunes' television video sales, which are a tiny fraction of what iTunes earns through music sales. The video segment of the retailer's business is small but growing, and video entertainment companies are moving quickly to avoid the same fate as music companies, which have complained about the growing control Apple has over online music pricing. (WSJ)

NBC is also nearing the introduction of Hulu.com, a joint-venture with News Corp. that will stream ad-supported versions of shows to viewers through portals including AOL, MSN and Yahoo.

Amazon Unbox debuted a year ago as an outlet for online video, offering television shows for $1.99 and movies for $7.99 or more. It currently offers downloads for some shows from CBS and Fox, but the NBC arrangement is the most extensive for a broadcaster.

NBC Universal, which is majority owned by General Electric Co., has said it wants to package programming in different ways at different prices, something Amazon is willing to consider, according to Jean-Briac Perrette, president of NBC Universal's digital distribution division. (BW)

"For us, this is business as usual," said Perrette. "It's just one of the various outlets that are available to us. Apple's not the only game in town."