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Apple goes "Sylar" on NBC Universal
Apple drops NBC Universal prematurely

Earlier this morning, DailyTech reported that NBC Universal decided not to renew its iTunes contract due to Apple's inability to negotiate on higher prices. Apple has since responded to NBC Universal's remarks and decided to air some dirty laundry in the process.

In a press release issued this afternoon, Apple reported that NBC Universal called for an increase in price for its TV shows to $4.99 per episode -- the current price is $1.99 per episode. This was especially disconcerting to Apple considering that ABC, CBS and FOX all signed on for next TV season at the $1.99 per episode price.

"We are disappointed to see NBC Universal leave iTunes because we would not agree to their dramatic price increase," said iTunes VP Eddy Cue. "We hope they will change their minds and offer their TV shows to the tens of millions of iTunes customers."

Apple also went one step further than NBC Universal's request to sever ties with iTunes. NBC Universal's contract with iTunes was to end in December. Since the end of the contract would happen half way through the television season, Apple has decided to boot NBC Universal from iTunes before the new TV season begins in September.

According to Apple's own numbers, NBC Universal TV shows took three of the top ten slots for best selling TV shows on iTunes last season and accounted for 30 percent of all TV show sales.

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By GetSome681 on 8/31/2007 2:41:21 PM , Rating: 5
Are you all blind? NBC-Universal wants to RAISE prices 150%, and Apple said NO. This is Apple trying to protect the customer by not allowing them to charge such an absurd price. If Apple agreed to sell them at $4.99, everyone would be crying out at Apple, "How could you let them do that!". Not to mention that all the other studios would likely want to follow suit with the price increase.

RE: Huh?
By Bioniccrackmonk on 8/31/2007 3:09:39 PM , Rating: 5
Thank you, I was thinking the same thing as I read all the other retarded comments about fanboyism and Jobs being stupid. First of all, this doesn't have anything to do with fanboyism, I wish all you trifling tarts would pike off. Second of all, I am proud that Jobs stood up to NBC and told them to shove off at their attempt to raise prices for their shows. This is exactly what he should have done and I feel it adds precedence to any other companies out there who feel they have to bend to the almighty will of these money hungry corperations. Kudos Jobs.

PS - I do not own anything Mac related, I game on a PC that I built that runs on XP, so don't try to spin my words into fanboyism for Macs, cause there are a few people on these forums that only seem to do just that.

RE: Huh?
By kelmon on 8/31/2007 4:22:17 PM , Rating: 2
I don't know if this helps or not but I'm definitely in the Apple camp and I applaud this decision despite the fact that it no doubt means that I won't get NBC content from anywhere else since competing services will probably be Windows-only. If NBC thinks it can do better then it's welcome to try but consistent pricing is one reason the iTunes Store is successful and NBC's attempts to muck about with the prices was neither warranted nor desired by anyone but NBC.

RE: Huh?
By michal1980 on 8/31/2007 3:13:52 PM , Rating: 2
i see both sides. NBC should be allowed to price their shows however they want., if the price is too high no one will buy them.

Apple wants everything to fit the price that the Apple gods say it is.

iTunes cannot live without content though

i think both sides are wrong

RE: Huh?
By GetSome681 on 8/31/2007 3:53:18 PM , Rating: 5
Of course they have the right to price them however they want. However, it's Apple's store, and they also have the right to decide whether they want your content in their store or not. Apple didn't see NBC-Universal's desire to raise prices as beneficial to their store and their customers, and I commend Apple for dropping them.

RE: Huh?
By mcnabney on 8/31/2007 4:01:30 PM , Rating: 2
I had to scroll all the way down here to find the truth.

RE: Huh?
By AkumaX on 9/4/2007 10:30:51 AM , Rating: 3
Next up: Apple teaches users how to use bittorrent to only download NBC tv shows!

RE: Huh?
By rcc on 8/31/2007 6:13:08 PM , Rating: 5
Yeah, I can't really keep track of the "hate" list. Those companies that you must dislike to be trendy. But obviously Apple is higher on the list than the RIAA/MPAA/Music Industry

Maybe we should publish a list just so everyone won't have to guess. In rough order then....

1. Apple (just cuz they are different)
2. Music Industry/RIAA/MPAA etc. (cuz they want us to pay for stuff).
3. Microsoft (cuz they are big and make an OS)
4. Intel (because they are big, and not AMD)
5. The U.S. Government in any form.(cuz, well just cuz)
6. Sony (because they like propretary stuff, and exploding batteries)

feel free to add and re-sort. Wouldn't want to miss anyone.

Please don't jump on me for the list, I didn't create it, I'm just posting it. : )

RE: Huh?
By GoodBytes on 9/1/2007 1:24:23 AM , Rating: 2
6- Sony (because of root-kits they add in game (SecuROM) and Music CD's) :)

RE: Huh?
By exanimas on 9/1/2007 3:34:27 AM , Rating: 1
Oh God please give this man a 6.

Apple's intentions here seem well placed. I think it's great that they don't want their customer's to be forced to pay $5 for a TV show when everyone else is only charging $2, on the other hand, some people may want to pay $5 for an NBC show. It's kind of a tough line to draw on who's right and who's wrong, but I think Apple looks more like the good guy in this case.

RE: Huh?
By AlexWade on 9/1/2007 8:48:10 AM , Rating: 5
#2 should be changed to:

2. Music Industry/RIAA/MPAA etc. (cuz they want to overcharge for their stuff, put out junk nobody wants to buy/hear/see, then complain that its pirates instead of their inept business decisions, and are always accusing of being guilty before proven innocent by trying to force DRM down our throats.)

RE: Huh?
By Pythias on 9/2/2007 2:54:08 AM , Rating: 2
...put out junk nobody wants to buy/hear/see...

If nobody wants to "buy/hear/see" why are they stealing it?

RE: Huh?
By feelingshorter on 9/2/2007 2:40:29 PM , Rating: 2
Because most of it is junk . I listen to rap like a lot of other people here and I cannot lie and say that every artist's song is good. Infact, most rap cds have like 1-2 good song that i can even listen to without my ears EXPLODING .

Very few rappers for example, are smart enough to actually create a CD thats just not a bunch of gibberish that they sing and call it a song. Basically, most of the good songs are already on the radio so when you buy their albums, the rest of it's crap. I'll never buy a damn album again.

Again the few artists that actually have good albums is like Chamillionaire. <---- sounds like that guy has brains and actually put some thought into writing his stuff. Or even Black Eyed Peas just to name a good artist that releases music that doesn't make my ears bleed.

Other than that, the RIAA can kiss my ass for putting crap CDs out that no one wants to buy. Thats why people steal music, they only want that one good song. Remember kids, most rap is c rap.

RE: Huh?
By logaldinho on 9/2/2007 9:31:15 PM , Rating: 2
uh, its called production value. most popular artists or legendary artists would be nowhere without producers creating their sound and fine tuning it.

what i do not understand is by your rationale every artist should record a couple songs and only release those which popular culture designates as a "success" instead of expressing their creative persona so that you can save a couple dollars on an LP. thats about as greedy as you claim the riaa are and for that i sadface your comment.

RE: Huh?
By tedrodai on 9/4/2007 10:45:12 AM , Rating: 2
I don't know--if I wanted to buy some apples, but could only purchase them in baskets that also included oranges, pears, avacados, etc, I wouldn't pay an extra $5 just to get ahold of a couple of apples. Now, if watermellons (I looooove watermellons) were ALSO sold only in packages like these, I might be sorely tempted to buy them occasionally, but it wouldn't feel any less like highway robbery.

An artist can't know if their "expressions of their creative persona" will be a success or not when it is released, but lets face it--there are a LOT of CDs out there with 1 or 2 good songs and ~10 horrible ones.

RE: Huh?
By hashish2020 on 9/3/2007 10:10:29 AM , Rating: 2

Black Eyed Peas?



Man, no wonder you need to steal from the big labels---eMusic has 96% of the good hiphop out there---

And labels like Universal already sell most of the good major label hiphop of the latter 4% through labels like Interscope etc

RE: Huh?
By Ryanman on 9/3/07, Rating: -1
RE: Huh?
By Chadder007 on 9/1/2007 3:41:04 PM , Rating: 2
That was pretty awesome of Apple to do. :D

RE: Huh?
By SoCalBoomer on 9/4/2007 2:59:11 PM , Rating: 2
I've seen reports contradicting Apple's claim of NBC wanting to raise their prices by ridiculous amounts.

Of course, this article does seem to nail it -

When NBC is 40% of iTunes' video sales, it's a big deal but with Apple acting more as WalMart and less like an actual competitive entity, I don't see it as Apple trying to PROTECT anyone . . .

In fact, reports are coming in that NBC may be moving to free, ad-based revenue streams for its downloadable video - - hulu - ""Once all NBC shows are available, ad-supported, online, then the bulk of digital viewing will shift from iTunes to the free, ad-supported alternative,""

But, hey, if you want to follow Apple's propaganda, be my guest! Don't do any research to see any of the other views since a: the Kool-Aid is GOOD at Apple, and b: one of the others may be "more true"!


RE: Huh?
By stubeck on 9/6/2007 12:54:08 AM , Rating: 2
I don't know if I fully believe NBC wanting to increase the price. They switched to Amazon and are now charging the same price as at iTunes.

RE: Huh?
By wupta on 9/6/2007 8:28:45 AM , Rating: 2
Content is King. It always was and always will be. Since when does a pencil dictate to the author. Apple sure did for a while but that's over now. Nice run.

Why are people complaining?
By ChristopherO on 8/31/2007 4:01:25 PM , Rating: 1
Consumers shouldn't complain about the price increase. Shows like BSG lose a tremendous amount of money on TV. The only reason the show is still around is because they cut the season in half and sell twice as many DVDs. Failing that, Universal would have cancelled it years ago (the ratings are low enough to guarantee cancellation on any of the big-4).

So much the better if Universal can make additional money to justify these shows... I would have been thrilled if this option were available with Firefly (I'd be happy to pay $10-20 per new episode). Perhaps it would still be on TV if they had successful pay-per-view Internet delivery in 2002. Don't knock their strategy given it costs a fortune to produce these shows.

If people don't want to buy, then they don't have to. I suspect everyone is complaining because most users would still cough up the $5. For the most part we're talking about cult shows with rabid fans.

As for Steve, he has an opposite incentive... He makes money when there are higher sales. The studios make more money with higher prices. Part of the iTunes revenue is transaction (not percentage) based. The reason he's "standing up" for the consumer is because it helps line his pockets (and makes sure iTunes is at least slightly profitable). Visa works a similar way -- percentage wise their profits are bigger when you charge less.

In the end, the right thing happened... Apple has the right to tell Universal to go away, and Universal has the right to tell Apple to get their content elsewhere. No big deal... It's also obvious Universal won't abandon the Internet -- they've still got Xbox Live, and I'm sure something else is coming.

By DigitalFreak on 8/31/2007 4:11:40 PM , Rating: 2
Woo hoo! Xbox Live! Yeah, I carry my 360 with me so I can watch TV shows...

RE: Why are people complaining?
By alifbaa on 8/31/2007 6:53:27 PM , Rating: 2
I'm not quite sure of your logic...

How does NBC make money by selling fewer shows at a higher price that iTunes wouldn't make by selling more shows at a lower price?

iTunes' costs go up with the number of downloads, the studios' stay the same. For iTunes to maximize profits at a given revenue level, their incentive is to price the episodes higher to produce as few downloads as possible. In short, if anyone wanted to increase prices, Apple would certainly be the first one to look for the opportunity.

For the studios, their decision making is still primarily based upon their projections of the advertising they'll sell when they go to air in its primary time slot, the licensing of reruns (if applicable), and to a lesser extent DVD sales. Downloads have to be considered "found money." The studios clearly are treating this as an emerging market, or else they'd be flooding iTunes with every movie and every episode of every show they've ever produced. iTunes would surely jump at such an opportunity.

For the studios to demand price increases at this stage is both outrageous and completely predictable for this industry. This is especially true when you look at the current costs per episode when compared to purchasing the DVD of the entire season.

RE: Why are people complaining?
By ChristopherO on 8/31/2007 8:27:16 PM , Rating: 2
The logic -- at $5 the number of sales will decrease, yet enough people will continue to buy that the studio's total profit will almost certainly increase. Sci-Fi fans will gladly pay this kind of coin (or else people like Lucas couldn't sell the same trilogy 357 times, or Paramount couldn't sell Trek over and over). Shows with less devoted fans would obviously see lower prices (since that's free money). Consumers might not like it, but nobody seems to have the fortitude to stop buying.

Apple's costs barely increase with the number of downloads. The cost of additional bandwidth is not cheap, but a per-transaction charge more than makes up for it.

Think of it this way -- Visa/MasterCard make drastically more profit if you buy 200 items at $5 each than if you buy one at $1000 (this is because of flat per-transaction surcharges that are included to cover "overhead" -- around 35 cents). Apple takes a per-item based transaction charge in the guise of covering "costs" (in addition to the typical mark-up). However, this per-transaction charge will contain hidden profit in the same way that the Visa/MC example works. Jobs can tell studios, "we retain X cents to cover bandwidth", when in reality the cost might only be a small fraction of the stated amount (and will continually decrease over time).

Universal did the right thing to walk away. One of the basic rules of business is that you should never accept less than you're worth. Once you do that, you're easily pushed around (in the long term it's better to have no short-term income than accept inadequate income). Apple did the right thing by letting them go. If they can't meet in the middle, that's nobody's problem but their own. Neither one of them are around to make the planet a better place. Jobs wouldn't be rapidly climbing the list of the world's wealthiest people if that were the case.

RE: Why are people complaining?
By logaldinho on 9/2/2007 9:46:53 PM , Rating: 3
this is nbc cutting off their nose to spite their face. 2 dollars an episode over what they make on advertising and syndication (right now its only scifi channel which im sure is going to change) sounds a lot better than 0 dollars an episode. the majority of the people that were buying these off of itunes for 2 dollars are computer savvy to the point where they will just go back to bittorrent. ive known many people that in hopes of supporting their television shows have gone to downloading episodes via itunes over getting them for free with better image quality and drmfree. i was this way until NBC cancelled my house's favorite show last year (the black donnellys). now if i miss a show and didnt tivo it i just wait for it to reair.

sorry if i went off on a tangent.

on a side note maybe nbc should invest in a DVR firm as it sounds like their business might improve now that you have to record your shows and skip the ads instead of download them via itunes =\

RE: Why are people complaining?
By Ryanman on 9/3/2007 9:18:30 PM , Rating: 1
I'm sorry man. You're dead wrong with this statement...
the majority of the people that were buying these off of itunes for 2 dollars are computer savvy to the point where they will just go back to bittorrent

The people that use Itunes (yeah, I capitalized the I you stupid mac <3's) don't know how to drag and drop files into an equal-but-cheaper MP3 player. They choose fashion over substance, and are willing to pay through the nose for it.
The fact is, many of these upper-middle to high class idiots with Ipods don't know ANYTHING about computers whatsoever. They're not going to torrent them, they're not going to burn them from a DVD, nothing. They're probably just not going to get the shows at all, especially since they only bought them in the fist place to fill up their Ipod to make it seem like 80 gb was worth the extra money.

RE: Why are people complaining?
By Zapp Brannigan on 9/2/2007 6:21:08 AM , Rating: 1
Naa Man, BSG is on the Sci-Fi channel, it's not meant to have great ratings, it's basic cable. BSG is the highest rated show in its timeslot on basic cable, can't really do any better then that. No way they would cancel it, infact i bet Sci-Fi are pretty pissed that it's ending after this season.

As for Firefly, it was on sodding FOX, it never stood a chance. If it were on Sci-Fi or USA, it would still be going now. No Sci-fi show, with like spaceships in it, were people like live on the spaceship, has had a multiple season run on any of the big 4 (note big 4 not WB or UPN or CW) since the original star trek. (maybe Buck Rogers and the original BSG/1980, but neither got past 2 seasons). That kind of sci-fi is officially dead on network television, don't matter how good it was/is.

By Madoc Owain on 9/4/2007 9:35:52 AM , Rating: 2
You forgot Space: Above and Beyond (FOX)

Apple has no room to criticize.
By Domicinator on 9/1/07, Rating: 0
RE: Apple has no room to criticize.
By psychobriggsy on 9/1/2007 11:54:46 AM , Rating: 2
If you had a different phone on the same plan it would cost you $480 more over the two years because the data plan is $20 less expensive with the iPhone. That Razr (a rather crap phone with limited features (I have a V3x), it's a really poor choice of comparison and belies you inner feelings about Apple) is not free. It's subsidised. The iPhone has its issues (the battery is not one of them, who replaces a phone's battery anyway? 2% of users?) but at least there is competition in the phone market - buy a Windows Mobile device, or a Symbian device, or a Motorola. Whatever meets your needs at a decent price with a suitable contract plan.

There's zero competition in the "Episodes of LOST/BSG/etc" marketplace.

I wouldn't mind so much a "missed an episode this week? download for $2.99" scheme, where after that week the price dropped back to $1.99. But $4.99 is something else. A 24 episode season would cost you $120, and it's nowhere near DVD quality and there are no extras or anything.

(In the UK the iTunes TV shows work out at $3.20 each, tax adjusted, and people are really quite unhappy)

RE: Apple has no room to criticize.
By Domicinator on 9/1/07, Rating: 0
RE: Apple has no room to criticize.
By hashish2020 on 9/3/2007 10:14:14 AM , Rating: 1
You know lithium ion batteries' shelf life is based on time from manufacture and not amount of charges

You charge a li-ion battery 40 or 400 times in 4 years, same reducation in function...

By Domicinator on 9/3/2007 3:10:01 PM , Rating: 3 Shelf life does have something to do with it, but you need to do some Google-ing or Wikipedia-ing about lithium ion batteries. While they do not develop a "memory" like NiCad batteries, they still get wear and tear due to repeated charging. That's exactly why Apple says that after 300 to 400 charges, the iPhone battery will start losing capacity.

They last even less time if you have them constantly plugged in. I always chuckle at people who are surprised that their year-old laptop batteries can't hold a charge for more than an hour because they have never unplugged the thing from the wall. If you let a lithium ion battery constantly go down to 99% and then charge itself back up to 100%, you can destroy it pretty quickly. The same can happen if you let it fully discharge every single time before you charge it back up again. They also say that a LiIon battery will last longer if you store it at 40% charged when it's not being used for a couple of weeks.

There are a lot of things you can do to make your lithium ion battery last longer than the average user's battery, but you have to educate yourself a little bit on maintenance. Most people don't give a crap, and therefore their battery lets them down usually when they most need it to work.

So, sorry to tell you, but your information is incorrect. Do some research.

By sandytheguy on 8/31/2007 2:38:42 PM , Rating: 5
I don't own any Apple products so I'm not a fanboy. But in this case I commend them for standing up to a ridiculous price increase.

Consumer protection? Give me a break...
By ghostbuster on 9/1/2007 2:19:28 AM , Rating: 2
I don't get the whole "I'm glad Apple is protecting consumers" argument. Consumers in a competitive market do not need "protection" provided by multi-billion dollar corporations - consumers protect themselves by choosing how to spend their money. In supermarkets you have store brand soda that's cheaper than Coke or Pepsi but guess what - Coke and Pepsi sell just fine. Free market is about giving consumers a choice, and what Apple is doing is the exact opposite.

By HotdogIT on 9/1/2007 10:27:09 AM , Rating: 3
Agreed. In some cases, the consumer will need protection; the FDA, in theory protects us from a company releasing a product that, ya know, kills us.

But "protecting" us from 5-dollar-an-episode? Are you people really that naive?

By ToeCutter on 8/31/2007 6:37:29 PM , Rating: 4
You'd think that these studio execs would eventually get the drift?

Apple provides an outlet for them to recycle TV shows they initially broadcast (for free) at reasonably attractive revenue rates. There's not much cost associated with offering shows on iTunes; i.e. as opposed to DVDs, there are no media or distribution costs.

So any additonal revenue provided by sales of iTunes material could easily be considered gravy, as the sales are for the most part self-funding.

And what does NBC ask for in exchange for renewing their contract? A 150% price hike! Totally reasonable!

I predict that NBC will come cowering back in 6 months asking to revisit these negotiations, with practically no additional leverage then they have today.

Perhaps most ridiculous is the timing of NBC's rejection of iTunes: Less than one week before Apple releases brand new iPods, likely to include widescreen displays AND wireless capabilities to simplify the process of purchasing NBC's content!

Yep, Apple's really taking some chances here.........:-/

why would Apple bother?
By eyebeeemmpawn on 8/31/2007 3:16:49 PM , Rating: 3
At $5 an episode they might as well pull the content from iTunes anyway. Why would Apple want the hassle of listing something that is priced into the realm pointlessness?

Universal Sucks
By jameslj on 8/31/2007 3:11:58 PM , Rating: 2
Doesn't anyone else find it amusing that Universal music already pulled out earlier this year (I assume that the Universal parent company owns both music and tv).

So way to go is obvious that Universal is just out to charge us as they see fit...not actually have to compete.

BTW, no apple fanboy here...

NBC is being stupid
By Hacp on 8/31/2007 5:06:15 PM , Rating: 2
Dvds cost around 40-50 dollars for a 20-25 episode season. So lets see, 2 dollars an episode, 25 episodes equals 50 dollars!

I'm not an Apple Fanboy, but I can't help but side with Jobs on this one. Jobs is just trying to bash some common sense into NBC.

seems fair
By omnicronx on 8/31/2007 6:39:16 PM , Rating: 2
I was saying this morning how NBC deserved a price increase if they had 30-40% of the videos on itunes. But 3.99 instead of 1.99? who does NBC think they are? Thank you apple for keeping these services at lower prices and not allowing the big guys to take advantage. Sorry for doubting you.. i cant believe i just said that... Anyways, in my mind NBC is biting the hand that feeds them, they are losing revenue to things like Tivo, and downloading online in general, this is not going to help them one bit.

By Staples on 8/31/2007 10:45:39 PM , Rating: 2
Finally one company fighting for the consumer and trying their best not to let bundled crap on the market and yet there are so many children with very low IQs who all come out of the woodworks whenever Apple is in the news.

Price as a signal
By moviehead on 9/1/2007 12:56:05 AM , Rating: 2
Have you ever wondered why when you go to a movie house that all the movies are priced the same? The only difference may be a earlier showing, then the movies are still priced the same but at a lower price?

Price as a signal

Consumers are conditioned to match quality based upon price. If they see a movie for $5 and one for $10, they immediatly assume the lower price means it's a lower quality movie and avoid it.

Why does the least experienced hairdresser get the same price for a haircut than the veteren haircutter? What would happen if prices were matched closely to their experience? Posted right next to each chair?

Yep, there would be a line for the experienced hair cutter because nobody wants to take a chance on a bad hair cut.

So think further what would happen if Steve Jobs allowed a price war between the content providers on iTunes? Eventually no one would be making any profit and everyone would consider iTunes a failure.

NBC knows all this, they purposely did this move because they got a fat check from Microsoft with this "Hulu" network thing. The only problem is their little plan backfired and now they look like fools.

Deep down, they don't want downloads over the internet to succeed, because they beleive they will make much more and have more DRM control, with physical medium. They want to shut out the computer completely or control it through the new DRM systems coming down the pipe.

Right? Wrong? WTF?
By afkrotch on 9/1/2007 6:52:49 PM , Rating: 2
I personally think NBC should be allowed to charge whatever they feel like for their episodes. At the same time, I very much dislike that. I mean, $5 a show. That'd make downloading it over iTunes more costly than simply buying the dvd. I can buy the 1st season of Hereos on for $37 at Amazon. If I were to use iTunes at the $4.99 price tag, that would cost me $114.77 for the 1st season.

I applaud Apple for protecting it's consumers. At the same time, shouldn't NBC be allowed price their own content? Not all content is the same and everything shouldn't fit a specific price scheme. Why should a blockbuster hit have to be the same price as a B rated, straight to dvd release? Overall the protection of the consumer simply screwed them over. Shouldn't it be the consumer's right to decide to pay $4.99 for an episode? Those who don't, won't.

Both companies are neither right, nor wrong. The main losers is the consumer, as there will no longer be NBC content on iTunes.

Apple should just sell it
By viperpa on 9/2/2007 2:17:24 PM , Rating: 2
I agree with Apple, Apple needs to make to. Apple should just charge the $4.99 but not promote the shows on there site. NBC would end the contract for lack of promotion on Apple's part not the fact that people won't pay $4.99 for a show that is not of DVD quality.

It's no wonder people share movies and music, the entertainment industry just don't get it.

By hashish2020 on 9/3/2007 10:20:10 AM , Rating: 2
Apply just has a very intelligent flat fee system, where people like my freinds use it and don't ever check the prices, as they know songs are a buck, shows are 2, and they can check off what they want to download without checking everyprice

Apple doesn't want a grocery store, where everyone is checking the per pound price, they want a boutique

Who owns NBC or actually MSNBC?
By jrin on 9/4/2007 5:11:38 PM , Rating: 2
You need to remember who owns NBC or can promise (or force) them that they can (or want) bring similar system selling tv shows. Possibly with better margin to NBC even.

Can XBOX 360 play tv shows?

Is it because of Heroes???
By MrUniq on 9/4/2007 11:22:35 PM , Rating: 2
At the old rate..season one of Heroes at 23 episodes would've cost the consumer roughly $46. It's not DVD quality i'm sure at Apple store, but maybe that is what they had in mind. Trying to increase it to nearly $5 per episode cost ballons to $115.

Apple evil?
By tmp8000 on 8/31/2007 6:52:36 PM , Rating: 1
Although many see Apple as evil or whatever, at least they do hold firm on their pricing strategies with iTunes. Thankfully they have enough power that the RIAA and others can't force them to increase their prices. At least they are sticking strongly by their pricing strategy and are not attempting to increase prices per download. And if you do not want to play then GTFO.

By Chocolate Pi on 9/2/2007 3:36:42 AM , Rating: 1
Does anyone actually believe that NBC wanted to increase prices to $5 per episode? Sounds like Apple mudslinging to me... What seems likely is that NBC wanted to force users to buy episodes in $5 bundles or some sort of deal... (2 if they were "greedy", 3 if they were "feeling nice")

We're talking about corporations which people seem to have no grasp of. They are neither evil nor kind, merely acting in their own best interest. This is what it is: a simple business deal or lack of therefore. NBC is not stupid, they were not about to start charging $100 for downloads of various seasons.

Wait, I suddenly realized what it was! Apple makes money per transaction, which is to say more if people buy shows individually. NBC thus wanted people to buy seasons all at once, so perhaps they proposed drastically expensive single episodes as a threat to Apple? That would explain everything in this situation.

tsk tsk
By andrewrocks on 8/31/07, Rating: -1
RE: tsk tsk
By marvdmartian on 8/31/2007 2:26:56 PM , Rating: 2
I guess they figure there's enough fanboys out there, that it won't matter, eh?

RE: tsk tsk
By dgingeri on 8/31/07, Rating: -1
RE: tsk tsk
By Xenon14 on 8/31/2007 2:41:51 PM , Rating: 4
The only one wrong here is You.

According to NPD, Apple's retail notebook market share for June 2007 was 17.6%, a 2.2% increase over the same period last year when Apple posted a 15.4% market share. With the increase in the notebook sales pushing it forward, Apple now has an overall PC market share of 5.9% , up 1.1% from the 4.8% it posted this time last year.

RE: tsk tsk
By Gatt on 8/31/2007 3:10:28 PM , Rating: 2
Not flaming, but what was their marketshare prior to switching over to Intel, while they were still using proprietary chips?

RE: tsk tsk
By eman7613 on 8/31/2007 3:27:45 PM , Rating: 2
Yes, but that was a decision made while Steve was gone.

RE: tsk tsk
By jpeyton on 8/31/2007 4:03:08 PM , Rating: 4
Not a good idea for Apple to burn bridges like this. NBC/Universal is a gorilla in the media business. While I don't agree with the price increase they wanted, I don't agree with iTunes fixed-pricing scheme either. There are a TON of non-mainstream artists out there that flourish on other websites like eMusic because they charge LESS for their music than the Top 40 crowd; Apple should impose price ceilings, but they should let economics work their way into iTunes to increase competition and lower prices.

RE: tsk tsk
By danrien on 8/31/2007 8:56:20 PM , Rating: 3
I agree; I've never gone into physical store where the prices were actually completely set by that store. Usually they follow an MSRP, occasionally lowering prices when they need to clear stock. It seems ridiculous that Steve Jobs orders the people who's product he's trying to sell on how high they can set their prices. He should let them set the high price and either learn from their mistake or make good money. It's not like it would be Steve Jobs' fault.

RE: tsk tsk
By tmontana on 8/31/07, Rating: 0
RE: tsk tsk
By onelittleindian on 8/31/2007 3:40:03 PM , Rating: 2
Wow 5.9%. I guess that is incredible for a pc/software maker who's business strategy is to push obsolete technology in a pretty box
No need to be sarcastic. It is pretty incredible, isn't it?

RE: tsk tsk
By Hare on 8/31/2007 4:54:22 PM , Rating: 2
And now they switch to Intel, I would have had more respect for Apple if they would have at least considered AMD.

And what exactly makes you think that they didn't consider AMD? When the Intel decision was published the whole argument was performance per Watt and future roadmaps (Core2Duo). I think Apple made a pretty good decision to go with Intel.

Btw. 5.9% market share is not "bad". It's more than BMW and Mercedes combined in the states...

RE: tsk tsk
By omnicronx on 8/31/2007 7:00:45 PM , Rating: 2
bmw and mercedes also sell their cars for a much higher price, and probably have a better profit margin on their cars, so a feeble 5% can end up seeming like they have 10%, profits wise anyways.

RE: tsk tsk
By arteekay on 8/31/2007 3:34:34 PM , Rating: 2
You're dead on, if the US was the entire world.

Now go look at the worldwide market share, still 3 percent.

RE: tsk tsk
By TimberJon on 8/31/2007 4:43:41 PM , Rating: 2
If 3 Percent of my left shoe is clean. What does that make the rest of my shoe? Do the math. Apply to Apple.

RE: tsk tsk
By retrospooty on 8/31/2007 3:37:55 PM , Rating: 2
"According to NPD, Apple's retail notebook market share for June 2007 was 17.6%, a 2.2% increase over the same period last year when Apple posted a 15.4% market share. With the increase in the notebook sales pushing it forward, Apple now has an overall PC market share of 5.9% , up 1.1% from the 4.8% it posted this time last year."

2 things with this...

1. NPD is one source, others vary. Clearly Apple increased though.
2. This was US, not worldwide.

Worldwide Apple has been at 2-4% for a decade (depending ont eh source of the query). With the increased US sales this past year, it is likely that Apple will hit 4%. Still not much of a player. They are alive today due to iPod sales.

RE: tsk tsk
By ToeCutter on 8/31/2007 6:25:40 PM , Rating: 2
Still not much of a player.

More geek ignorance on the DT forums.

Apple's market cap recently surpassed that of HP. It's already surpassed Dell and Oracle. At the present rate, they are expected to beat out IBM and Intel in the coming year.

Quite contrary to your feeble remarks, financial analysts unanimously agree that Apple will continue to grow for the foreseeable future.


Apple is one of the healthiest American companies in terms DT geeks quite don't understand: Cold, hard cash.

The vast majority of DT readers are mired in a state of irreconcilable geekness. They'll simply never understand why Apple offers the most desirable products in America, or why they'll continue to be successful despite the malice demonstrated on these forums.

It is immensely entertaining to read the persistent inaccuracies provided by frustrated geeks in continued efforts to expand their skewed perspective on reality...

RE: tsk tsk
By retrospooty on 8/31/2007 7:32:45 PM , Rating: 2
"More geek ignorance on the DT forums."

I agree, and your post shows it. Are you completely in an Apple shaded cloud? Do you even know what a market cap is?

Its all about stocks, and a rating of the companies total value based on current and upcoming products, pricepoints and sales estimates. The comment that was made, and responded to was their computer platform and its total lack of consumer marketshare worldwide. It has been poor for the past decade and so was their stock value until the iPod kicked it up. Their stock now is doing very well because of the iPod, and most recently the iPhone.

"They'll simply never understand why Apple offers the most desirable products in America"

Umm... OK. I wouldnt go that far, but the iPod sure did sell well, I have one myself. Their Mac platform has never sold much, and never been a contender.

I will re-iterate, since you didn't seem to read, or understand the first time. " With the increased US sales this past year, it is likely that Apple (MAC) will hit 4%. Still not much of a player. They are alive today due to iPod sales."

RE: tsk tsk
By ToeCutter on 8/31/2007 8:19:59 PM , Rating: 2
Market Capitalization: A method of calculating the value of a company which is equal to the number of shares outstanding multiplied by the price of each share of the stock.

Considered among many a valuable analytical metric in comparing similar corporations value and/or financial performance in commodity markets.

I understand market cap within the confines of this discussion.

They are alive today due to iPod sales.


Record Mac sales (27 July 2007)

During the quarter, Apple shipped more than 1.7 million Macs, a 33-percent rise over the what it shipped in the third quarter of 2006 and 2.5 times the industry-wide growth rate published by market-research firm IDC.

More significantly, Apple’s third-quarter Mac sales marked a record for the company, topping the previous quarterly high of 1.61 million Macs shipped during the fourth quarter of 2006.

Much of the growth in Mac sales came from Apple’s laptop business. While there was a rise in desktop sales for the quarter—634,000 units compared to 529,000 for the same period in 2006—laptop unit sales skyrockected 42 percent to 1.13 million portables. All told, 64 percent of the Macs sold during the quarter were laptops.

While Mac products and services made up 60 percent of the company’s total quarterly revenue , Apple also sold more than 9.8 million iPods—a 21-percent increase from the year-ago quarter. Apple says the iPod enjoys a 71.5-percent share of the MP3 market based on figures from market-research group NPD.

How do you define "player"?

I'll assume that you are referring to Apple's overall market share vs. PC?

I fail to see the relevance in capturing market share vs. surviving as a profitable company, which is the point I took in your initial comment stating that "They are alive today due to iPod sales"? The market share question also becomes irrelevent, because Mac sales are gaining at someone's expense.

It has been poor for the past decade and so was their stock value until the iPod kicked it up. Their stock now is doing very well because of the iPod, and most recently the iPhone.

Wrong again.

Apple's stock has been increasing at a consistent, steady pace for nearly 5 years. A picture says a thousand words:

Furthermore, you seemingly disagree with my "most desirable products" comment. Someone sure is buying ALOT of Macs. Apple has demonstrated double digit growth in Mac sales for nearly 8 quarters now. Traditional PC OEMs are having a really hard time selling very similar hardware (considering that Apple is an all Intel shop now).

Consider this, as well as iPod and iPhone sales and I'm still having difficulty understanding how their products are not among the most desirable consumer electronics on the planet?

Go relax and listen to your iPod. Apple will be around for a while, with or without NBC...

RE: tsk tsk
By retrospooty on 8/31/2007 11:15:55 PM , Rating: 2
"How do you define "player"? I'll assume that you are referring to Apple's overall market share vs. PC?"

Yes. They sell very few compared to the big guys in the industry, Dell, Asus, etc... Growing or not, they are not a major player, and there is nothing you can say or post that will change that, including skewed figures from NPD that left alot of info out of their query (yes, thats right, its not as rosy as you think).

Answer me this? If the Mac is sooooo desirable, why is it that it has such a small market share globally, growing or not, its small, still less than 4%. Don't get me wrong, I want the Mac platform to succeed. More Macs sold = more competition and it keeps the PC side on their toes, and lowering prices. So far, the world, and the amount of Mac they are purchasing is not nearly as impressed as you obviously are.

I am done here, there is nothing that can be said to change a fanboy's mind, and you sir, are a raging Apple fanboy.

RE: tsk tsk
By ToeCutter on 9/1/2007 1:02:41 AM , Rating: 2
....and you sir, are a raging Apple fanboy..

Oh dear, not a fanboy.

My motivation in slogging through your inaccuracies has more to do with rational thought than my appreciation of Apple.

Even though, I can appreciate the lucrative elegance of selling less, but making more on each sale. And Apple does this by offering innovation, which benefits me. As a small business owner, truly innovative products are the easiest to sell because, they sell themselves. Your really not selling anything when selling innovation. And, your customers tend to be very happy with their purchase, which eventually brings them back for more. I'm pretty sure there's a lesson on capitalism in those comments?

FYI: Dell released prelim results today. Their revenue was nearly 3 times of Apple's recent results, but Apple succeeded in besting Dell's profit margin by almost $100 million. The trend I described earlier, continues. Now is Apple working less and working more, or, are they simply offering a superior product and allowing the market to define the value of the offerings?. (But I'm sure Dell's sales contributed to their maintaining some of that precious market share!)

And you still haven't defined "player" for us? I've ruminated over the implications of being a "player" and considered the concept of influence, possessing the clout to influence market conditions in one's favor, and I don't think anyone would disagree that Apple has that in spades. From recording studios to memory manufacturers, even the some of the world's largest corporations (Toyota?) have agreed to manufacturer products that support Apple's products, in most cases exclusively.

So, regardless of your fixation on market share, Apple is a player, a player of considerable magnitude, a "Mac Daddy" if you will.

(Sorry, I've been suppressing the urge to pop that pun since you first mentioned them not being a player ;-)

So that you've left me mortally tagged as a fanboy, I'll assume the debate is over.

Now gather your broken facts and wander off into the sunset, frustrated and still, misunderstood...

RE: tsk tsk
By mcnabney on 8/31/2007 3:46:41 PM , Rating: 3
I think you are mixing your numbers. Apple may have increased their sales by 15.4%, but they do not have a 15.4% market share. This time last year they had 2.8% and may go over 3% this year if their growth remains strong.


RE: tsk tsk
By darkpaw on 8/31/2007 4:12:44 PM , Rating: 2
Yah, read the details on that NPD study though. They completely excluded all direct sales and most online sales, which accounts for millions of PCs sold. On another study that included those, Apple sold the same ole 6% they have been forever.

RE: tsk tsk
By mankopi on 8/31/2007 4:15:58 PM , Rating: 2
He said PC market not laptop market - make the distinction

RE: tsk tsk
By aju on 8/31/2007 2:58:22 PM , Rating: 5
Hey, that is not fair. Apple makes beautiful looking PCs that work really well for inept computer users. I would buy one and be a fan boy too except for a few little reasons.
1. I don’t care how pretty my PC is.
2. I like to play computer games from this century.
3. I don’t hang out at coffee shops, and buy my furniture at the Pottery Barn.
4. Bouncing icons are gay.
5. I am not gay.

I guess I just don’t fit in with the Apple crowd.

RE: tsk tsk
By daftrok on 8/31/2007 3:34:49 PM , Rating: 4
LOL! Best list ever! But my reasons from not going Mac is:
1) Ridiculously overpriced.
2) Lack of ease to upgrade (there's not even a slot to open the bottom of the laptop to upgrade your RAM)
3) Very little game support (granted you can run Boot Camp, but that defeats the purpose)
4) Inability to run Mac OS X on a PC that I make from scratch.
5) No AMD support
6) Macs are pretty in a feminine way and not in a masculine way (Alienware is Man pretty)
7) No "quick animation" for GUI (example, instead of the window being sucked into the quick task bar, i just want it to instantly appear to save time and make it seem less feminine)

RE: tsk tsk
By retrospooty on 8/31/2007 3:40:15 PM , Rating: 1
LOL I second that !

RE: tsk tsk
By michael2k on 8/31/2007 4:06:45 PM , Rating: 2
1) It depends on what you are looking for
2) What is this then?
The slot is right there, on the bottom, next to the HDD.
3) They are working on that
4) Isn't that really user error? There are plenty of reports of OS X on homebuilt PCs.
5) Considering AMD couldn't build enough chips last year for their other OEMs, it's hard to imagine Apple jumping in on that boat.
6) That too seems to be user error :P
7) You can customize that since 2001.

RE: tsk tsk
By ToeCutter on 8/31/2007 6:40:37 PM , Rating: 1

Don't take the bait.

The DT geeks will simply never understand.

They're too busy benchmarking, cooling, and updating GeForce drivers to see the forest from the trees...

RE: tsk tsk
By Hare on 8/31/07, Rating: 0
RE: tsk tsk
By tmontana on 8/31/2007 5:11:42 PM , Rating: 2
I guessing your one of those users who uses his pc...I mean Mac to tinker around with home videos or manage his .mp3 library. If you have ever done 3D modeling/rendering/animation, you would know that Apples cannot compete with Alienware, not only in performance, but in price.

RE: tsk tsk
By Hare on 8/31/2007 5:26:23 PM , Rating: 2
I was talking about the design. I didn't want to start another stupid mac vs pc war.

BTW. Your guess was a bad one. I've built my own PCs for ages and do exactly the things you just described but you could add virtualization environments and app development to the mix among others.

Despite being a PC user I can definately see the value in Apple's offering. Different tools for different purposes. Someone may be a lot more productive on a mac compared to a Vista PC. There are plenty of people who are not stupid and still buy macs. Not all of them are religious mac zealots.

Btw. I drive a BMW. Sure it's a bit more expensive then a similar Toyota and even has less HP for the price but I sure like the design, image and the ride comfort...

RE: tsk tsk
By Wightout on 8/31/2007 7:22:37 PM , Rating: 2
You sir are ignorant in your claims of 3d modeling/rendering/animation and apple...

My pop is an Imagineer for Walt Disney, and he is currently running with a Mac Pro fully decked out at his work. 30" monitor and a 20" off to the side. His Modeling program of choice is FormZ. From my understanding Disney's artists prefer to use sketchup for much of the design work they do. This program will also run on a mac. Not too mention a large # of other animation/rendering/modeling programs out there for these machines. Do not spout off about things you do not know.

RE: tsk tsk
By SirLucius on 8/31/2007 10:19:11 PM , Rating: 2
HAH! Pure ignorance. First, Alienware's primary focus is in gaming computers which are in a different class from the server based Macs used in most animation/graphics studios. Second, I use Macs at work for those tasks you listed and they are just as capable as my PC at home. Performance wise, Macs and PCs are essentially the same when it comes to 3D modeling/rendering/animation, and video editing. There's a reason Macs are still the industry standard.

RE: tsk tsk
By ToeCutter on 8/31/07, Rating: -1
RE: tsk tsk
By Master Kenobi on 8/31/2007 2:30:36 PM , Rating: 3
Job is up to his old tricks though, he is going to play hard ball. This worked with several labels a year or so ago when they wanted to price songs at different prices. Jobs wants it his way, or no way. That has been his rep for years and I don't see it changing. Time will tell if this gamble pays off or if Jobs can pull something together and it won't matter, either way its a pissing contest and Jobs is the last person likely to back down.

RE: tsk tsk
By MaulBall789 on 8/31/2007 3:11:12 PM , Rating: 2
Jobs could have just said "ok, fine" and watched NBC's video downloads tank over the next season, crippling it's revenue stream and watching the other nets capture nearly all of the leftover marketshare of eyes on their product. Universal clearly doesn't understand how much money they were going to lose with this price increase. They will now likely form their own portal and lose a lot of money that way.

Now, of course, Jobs just gives them the boot entirely, further frustrating negotiations for the music side. iTunes success largely is owed to all the major labels having the vast majority of their catalogs all in one searchable database. If Universal pulls everything I see a deeply dented iTunes music catalog in the near future, which is bad for the entire industry. This did not have to happen but I guess it was inevitable.

RE: tsk tsk
By Cygni on 8/31/2007 2:52:54 PM , Rating: 3
or maybe Apple thinks it bullshit that NBC wanted to destroy the unified pricing structure they built with all their other content providers... just maybe that was the case. maybe.

RE: tsk tsk
By phaxmohdem on 8/31/2007 2:31:01 PM , Rating: 2
Meh, Apple is just trying to look macho to scare the other content providers into submission. OMG look out for that badass wearing the turtleneck!

I'm honestly surprised that the networks haven't started their own "iPod compatible" online content stores yet to keep a bigger slice of the pie like they want.

RE: tsk tsk
By Slaimus on 8/31/2007 3:07:11 PM , Rating: 2
Apples does not need any of the money from iTunes. They get their profits from selling iPods.

RE: tsk tsk
By tmontana on 8/31/2007 3:38:08 PM , Rating: 1
Oh that's right, those pretty little mp3/video players that are only compatible with Apple formats. Right, the player that even a monkey can use. I am suprised that Apple even let the Ipod be compatible with mp3's.

RE: tsk tsk
By michael2k on 8/31/2007 4:22:46 PM , Rating: 2
Funny how in the same comment you contradiction yourself:

only compatible with Apple formats AND compatible with mp3s.

There is only one "Apple format" and that is ALE. Everything else on the iPod is open or third party: MP3, AAC, AIFF, Audible, and WAV.

But yes, they only earned $608m from the iTunes Store (so NBC is at most $250m), while they got something like $1.57b from iPods this past quarter.

RE: tsk tsk
By tmontana on 8/31/2007 5:07:42 PM , Rating: 1
When I said Apple formats I meant both audio and video. Have you ever tried to play any other video format except for Apples .m4v or quicktime videos on your video Ipod? How about trying to upload a .mp3 downloaded from Itunes to your 3rd party mp3 player? You have to burn them on a cd first and then rip them to your computer and then upload to your player. Talk about anti-opensource. I just purchased a Creative Zen Vision over a year ago and I love it. Works with almost every video and audio format, except Oh that's right Apple's .m4v and quicktime formats. I wonder why that is? Hmmmm. I use Napster for my music downloads and it's suprising I don't have to go through a 4-step process to upload to my player.

Of course Apple is making a killing off the Ipod, most people are going to be fooled by a pretty box and shiny colors - oooh, but when it comes to performance and compatibility there is no contest. Most people will just go along with whatever if fed to them through marketing. Looks like your one of them.

RE: tsk tsk
By michael2k on 8/31/2007 8:08:56 PM , Rating: 2
Ah, video, okay.

So including video, Apple supports, currently, m4v, mp4, and mov.

Like mp3, mp4 is an open, non Apple, standard. m4v is Apple's encrypted variant of mp4 and mov is of course Apple's quicktime encoded format.

And thanks to EMI+Jobs, all the DRM-free tracks from iTunes will import into your 3rd party player just fine without ripping to CD, first.

So if your Zen Vision doesn't support AAC, that isn't Apple's fault.

If you use Napster, it's literally a 1 step process to upload to an iPod; what is your process to upload to a Zen?

And you're funny, talking about pretty box and shiny colors... what do you then the Zen is?

RE: tsk tsk
By Cobra Commander on 8/31/07, Rating: 0
RE: tsk tsk
By Snuffalufagus on 8/31/2007 3:44:22 PM , Rating: 3
I almost threw up on my keyboard while reading your post. Unless I read it wrong you seem to be indicating that Apple has a 'semblance of ethics and social responsibility'. Granted, that is how they are going to try and spin this, and nearly every other dispute they have with other companies, but that's just the Apple markeing engine at work.

RE: tsk tsk
By michael2k on 8/31/2007 3:58:46 PM , Rating: 4
I thought it was the other way around, that it was Apple feeding NBC.

After all, Apple only nets about $500m from the iTunes Store, while it earned something like $3b from all other sources. So at the worst they are losing $250m from this.

On the other hand, since NBC gets 10x as much from their deal as Apple does, they are losing about $2.5b from this transaction.

By thebrown13 on 8/31/07, Rating: -1
RE: Haha.
By Belard on 8/31/2007 2:33:44 PM , Rating: 5
Doesn't it seem that NBC wanted to fuck eveyone and Apple said no?

$5 per episode for a tiny screen version of a TV show? When the DVD box set goes for $25~50 per season = $1~$2 per episode.

RE: Haha.
By Squuiid on 8/31/2007 2:38:12 PM , Rating: 1
I concur, NBC were totally trying to rip people off.
Indeed, go f*ck yourself NBC.
Typical US TV network.

RE: Haha.
By EglsFly on 8/31/2007 5:15:02 PM , Rating: 2
That's probably what Steve was thinking.
NBCs demands where ridiculously high.
So he slammed the door on them before they could use the remaining time on their contract to perk up an alternative. Good job Steve!

RE: Haha.
By RamboZZo on 8/31/2007 2:59:05 PM , Rating: 1
Exactly. $5 per episode means an average 20 episode season is $100! Thats at least twice what a higher quality DVD set costs.

RE: Haha.
By ToeCutter on 9/1/07, Rating: 0
This is so weird...
By MagnumMan on 8/31/07, Rating: -1
RE: This is so weird...
By Webreviews on 8/31/2007 11:53:32 PM , Rating: 1
This is like eBay telling sellers that they have to lower their Buy It Now prices.

Ummm, no. Buy It Now prices will fluctuate based on supply and demand. As more sellers come to eBay selling the same item the competition squeezes out the fat from the price of the item. If a seller continues to choose to have a high Buy It Now price with a lot of fat, the buyer will move on to a seller who can provide the item for a lower cost.

In the case of NBC choosing to sell a show for a high price that they dictate, they are the sole seller and there is no competition in the marketplace to squeeze the fat from the price. Thus the price remains high.

Now if NBC would indeed allow the price to be dynamic and fluctuate according to demand, then your analogy would work. But since NBC does set a floor on the price and they the monopoly provider of the product the consumer is unable to benefit from the economics of supply and demand. Regardless of the demand from consumers, the price has been fixed by the provider.

“Then they pop up and say ‘Hello, surprise! Give us your money or we will shut you down!' Screw them. Seriously, screw them. You can quote me on that.” -- Newegg Chief Legal Officer Lee Cheng referencing patent trolls
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