NY Post
Adobe's Flash video software has become a flashpoint in negotiations between Apple CEO Steve Jobs and Big Media.
On a day when Apple execs probably cheered the fact the company had surpassed Microsoft as the world's most valuable tech company, Jobs was grappling with resistance from Tinseltown over Apple's ongoing fight with Adobe.
Sources said several large media companies, including Time Warner and NBC Universal, told Apple they won't retool their extensive video libraries to accommodate the iPad, arguing that such a reformatting would be expensive and not worth it because Flash dominates the Web.
Though the iPad has been a huge hit, media companies are feeling emboldened in their rebuffing of Apple by the launch of rival touch-screen tablet devices, such as the ones coming from Dell Computer and Hewlett-Packard, sources said.
In addition, one media executive pointed out that Apple's ability to dictate terms to the media giants will be weakened further by Google TV, a software product that enables viewers to watch online video on their big-screen TVs.
Jobs banned Flash software from running on Apple devices, arguing that the world's most popular video software is unfit for his devices. Instead, he favors video software written in Web software language called HTML5.
Said an Apple spokeswoman, "We believe in open standards like HTML5."
The media companies' refusal to cave in to Jobs marks another setback at a time when Apple has had its share of both good and bad news.
In the plus column, Apple's $221.1 billion market cap yesterday topped Microsoft's $219.2 billion, making it the most valuable tech company. However, Apple is facing scrutiny from the Justice Department over tactics it uses in pricing songs sold on iTunes.
Apple shares closed down $1.17 to $244.05. Microsoft shares fell $1.06 to $25.01.
In the Apple vs. Adobe fight, Big Media's decision not to acquiesce to Apple's demands will be a boon to Adobe, which has gotten beaten up by Jobs' withering criticism of Flash.
Time Warner, in particular, is against the walled-garden, subscription-only model promoted by Apple in part because Time Warner is promoting its "TV Everywhere" initiative, which aims to make content platform agnostic so long as users can prove they are pay-TV customers.
Not surprisingly, Disney, which counts Jobs as its largest shareholder, has created an iPad app that lets users watch ABC shows for free.
CBS, using an iPad-enabled Web browser, is also working with Apple, but to a limited extent, offering only a handful of shows.
Both Fox News (which, like The Post, is owned by News Corp.) and CNN offer free video clips using HTML5 on the iPad.
