NBC Goes Direct With Free Ad-Supported Downloads

TO ACCOMMODATE CONSUMERS' VARIED VIEWING habits, NBC now plans to
offer its shows as free, ad-supported downloads. Come October, viewers
should be able to walk away with full-length episodes of prime-time
and late-night programming--ranging from "Heroes" and "30 Rock" to
"Late Night with Conan O'Brien" and "The Tonight Show with Jay Leno."

In another blow to Apple's iTunes, NBC Universal recently decided not
to renew a distribution deal with the download king, because of issues
over packaging and pricing. It is offering programming for sale
through Amazon's Unbox.

NBC, which has let viewers stream its shows online for a year, is
using alternative viewing options to overcome threatening consumer
trends like audience fragmentation and time-shifting.

"We are acknowledging that now, more than ever, viewers want to be in
control of how, when and where they consume their favorite
entertainment," said Vivi Zigler, executive vice president of NBC
Digital Entertainment.

As it stands, NBC Direct has no direct relationship with Hulu.com, the
forthcoming joint venture between NBC Universal and News Corporation.
And while NBC's strategy is clearly to offer as many viewing
alternatives as possible, there is always the threat that the two
services could cannibalize one another's traffic.

In its initial phase, the "NBC Direct" service will only accommodate
PC users running Windows. In the coming months, users of Macs and
various portable devices will be able to download the episodes, which
"expire" a week after they air on TV.

The downloads will come with standard "chapter pre-roll" ads,
according to an NBC spokesman who would not name specific brand
sponsors attached to the service.

NBC eventually plans to offer a free subscription option, which will
allow users to pre-select series to be automatically delivered to
their computers. Future enhancements to "NBC Direct" will include
high-resolution versions of programming made available via a closed
peer-to-peer distribution network.

"Later in 2008, NBC.com plans to offer other business models for
downloaded content in order to provide its users multiple options,"
the NBC spokesman said.

Other series available through "NBC Direct" will include "The Office,"
"Life," "Bionic Woman," and "Friday Night Lights."
Gavin O'Malley can be reached at gavin@mediapost.com