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The case of NBC vs. Apple – a problem of customer-disassociation?

I don’t like the principle of re-blogs, but sometimes, no many times, people say smarter stuff than I do (in this case, John Gruber), so here goes.

NBC, in a public statement, said following noteworthy things:

In addition, we asked Apple to take concrete steps to protect content from piracy, since it is estimated that the typical iPod contains a significant amount of illegally downloaded material.


NBC Universal also wants iTunes to stiffen anti-piracy provisions so computer users would not have easy access to illegal downloads.

Gruber’s response:

This is straight out of the music industry’s playbook: assume your customers are criminals and treat them with contempt.


It Is Estimated That NBC Could Not Have Screwed This iTunes Thing Up Any Worse.

No, I don’t highlight this because I hang on everyone of Gruber’s words, far from it, but this does point out a core-problem in the supplier-retail relationship, in my opinion. That of disassociation.

Yes, their estimation of pirated content on the iPod is probably an accurate one, but what business is it of theirs? It would be similar to me entering a record-store and having to submit to a strip-search for “estimated” pirated content. It is disrespectful and any customer-focussed company would know that.

However, NBC is not a customer-focussed company. It is a supplier of content, which means it is a business-2-business company. It acts merely as a legal entity connecting the creators, e.g. the lovely Tina Fey from 30 Rock (who is clearly a human-being), to the owners of iTunes, Apple. They, in turn, sell their products to people, which makes them more customer-focussed (though online selling isn’t exactly the same as being in the same room with your customers).

It is my personal opinion that people, and businesses, are the way they are, because of experience… at least as far as people-interaction is concerned (case in point: “the rise of tech is killing the art of chat?“). The more a business interacts with its customers, the human kind, the more it will start to see their point of view. Right now, NBC only understands contracts, and perhaps the creators point of view. But it does not seem to understand that people would be perfectly happy to buy their products, as long as the relationship is based on good value for them, which includes both respect and a fair price.

The way to get around this is not simple market-research. It requires a constant stream of information back to NBC, a barometer of moods, trends, and plain-and-simple information, which gives NBC an idea of where it stands. And of course that won’t prevent mistakes. But it will lead to more mistake-fixing instead of making public statements where they call all of us iPod-owners pirates. For one method on how to accomplish this, read my blogpost about Proctor & Gamble’s take on shopper marketing.

To a degree, it is understandable why this does not happen. It is not efficient, unless NBC has control over the sales-channel. And it is not efficient for NBC to enter sales, from their perspective, I think. But that is no excuse! If they don’t understand a business, they must either gain the necessary knowledge to operate well in it, or stay out of the kitchen! [/end rant]

Btw, how does not having their content in a legal outlet, lessen the risk of piracy? Wouldn’t that result in more piracy?


  1. Being closely related to the customer (or not!) is one thing. Major shifts in technology another.

    Companies like NBC face the problem that they were built for a certain purpose and now the underlying business model is dramatically changing. Or: Business is changing faster than the comany thinks it can adopt. So they try to “fight back” and defend their position which results (unfortunately) in a very costumer-unfriendly behaviour.

  2. Thanks for your comment, Matthias, I agree that this internet-world is very challenging, particularly to media-producers.

    But withdrawing from what is clearly an exploding market, and calling your potential customers pirates in the process, is definitely a sign that NBC is living in a very dark place indeed.

    The way to get out of it is to reconnect with your core-values, which go beyond suing your partners and customers into oblivion. While this sounds abstract, I agree, and public companies tend to focus on short-term performance, NBC should enter into a conversation with their viewers, to find a compromise that works for both of them. Or they should stay out completely.

    The ways of communication and how it can lead to innovation, is very interesting to me, and I’ll surely dedicate future topics to it.

  3. Btw. I’m glad to see that Seth Godin also has a similar point of view:

    NBC should get with the times!

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