Yes, free beats flat fee

NBC Brings the Most Popular Word to TV Downloads: Free – Bits – Technology – New York Times Blog.

"NBC today offered a third logical option: free downloads with commercials. The advantage of downloading is that the video quality is better and you can watch shows on laptops or portable devices. The value of free is …well you know.

The service, called NBC Direct, has some limits, of course. The downloads can only be watched for a week after the show airs on the network. And you need to use NBC’s software, which for now only works on Windows PCs. It will begin in October.

The company says it will have a Macintosh version soon, and will eventually allow the programs to be watched on portable devices. But it’s unlikely those devices will include Apple’s iPod."

This is the next step in commercial online video distribution, but it’s not the end point: that will come when the time restrictions are removed, something that I predict will happen two or three years down the line.