Hollywood's choice: 99-cents or nothing

August 25, 2010: 10:46 AM ET

Steve Jobs is not the TV networks' enemy. BitTorrent is.

Image: Showtime

The second episode of The Big C, Showtime's bittersweet hit comedy about a suburban mom with melanoma, aired Monday night at 10:30 p.m. Less than three hours later, a digital copy was posted on an Italian website, where it spread like crabgrass. By Wednesday morning, there were 3,387 "seeds" of The Big C, Season 01, Episode 02, on the Internet, each of them feeding a perfect copy of the original file to users around the world.

The incident neatly summarizes the dilemma the TV networks face as they weigh Steve Jobs' latest pitch to put their content behind an Apple (AAPL) firewall. According to several published reports, Disney (DIS) and News Corp. (NWS) are close to signing a deal to make individual episodes of their most popular shows available for two-day rentals on iTunes for 99-cents each.

But Apple is reportedly running into resistance from the other big TV studios, including CBS (CBS), which owns Showtime, NBC (GE) and Time Warner (TWX). The studio heads are said to be extremely wary of the 99-cent rental idea. One source described it to the New York Post as "insane."

The networks may fear that cutting a deal with Apple will give Jobs the same kind of power in their industry that he wields over the music business, where 99-cent song downloads turned iTunes into the world's largest music store.

But Apple may be the least of their worries. Their biggest fear -- whether they know it or not -- is the pirate network that made The Big C so widely available: a peer-to-peer file-sharing protocol called BitTorrent.


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