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NBC says deal with iTunes will end

NBC Universal, unable to come to an agreement with Apple on pricing, has decided not to renew its contract to sell digital downloads of television shows on iTunes.

The media conglomerate - which is the number-one supplier of digital video to Apple's online store, accounting for about 40 percent of downloads - notified Apple of its decision late yesterday, according to a person familiar with the matter who asked for anonymity because negotiations between the companies are confidential.

A spokesman for NBC Universal, part of General Electric, confirmed the decision, but otherwise declined to comment. The decision by NBC Universal highlights the escalating tension between Apple and media companies, which are unhappy that Apple will not give them more control over the pricing of songs and videos that are sold on iTunes. NBC Universal is also seeking better piracy controls and wants Apple to allow it to bundle videos to increase revenue, the person familiar with the matter said.

NBC Universal is the second major iTunes supplier to have a rift with Apple recently over pricing and packaging matters. In July, the Universal Music Group of Vivendi, the world's biggest music corporation, said it would not renew its long-term contract with iTunes. Instead, Universal Music said it would market music to Apple at will, which would allow it to remove its songs from the iTunes service on short notice.

The action by Jeff Zucker, NBC Universal's chief executive, will not have an immediate impact on iTunes. The current two-year deal extends through December, so a vast video catalog - some 1,500 hours of NBC Universal's news, sports, and entertainment programming - will remain available on iTunes at least until then.

Among the most popular NBC Universal shows available for sale on iTunes are "Battlestar Galactica," "The Office," and "Heroes."

The companies still could reach an agreement on a contract before the current deal expires.

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