NBC Bails on iTunes

The New York Times is reporting that NBC will not renew its contract to distribute television shows via Apple’s iTunes service. The agreement was set to autorenew at the end of 2007, but includes a provision that allows NBC to terminate the agreement at the end of the first term with 90 days notice. Disagreements over pricing and DRM seem to be behind the decision.

That means iTunes users will not be able to download popular NBC shows, including Battlestar Galactica, The Office and Heroes, to their iPods. Was the decision influenced by NBC’s ownership stake in the iTunes-competitive upcoming Hulu service? Almost certainly. The last thing the TV networks want to see is Apple having the kind of control over TV content that they do with music – 76% of online music sales come from iTunes.

NBC accounts for 40% of digital video downloads on iTunes.