NBCU's Peacock Revisits TV's Genesis: Ad-Supported

NBCUniversal is essentially trying to re-invent the broadcast network wheel -- as a streaming TV wheel.

With the launch of its Peacock streamer in April, NBCU is clear about how it wants the streamer to become financially stable: accept advertising.

Speaking at CES last week, Linda Yaccarino, chairman of advertising sales and client partnerships at NBCUniversal, said: “The data is clear that in a relevant, limited-ad situation, the consumer is very interested in the power of freedom. Let’s remember that's an accepted commercial relationship between the consumer and the publisher, who is giving them great content.”

This free-TV commercial relationship has been around for nearly 70 years -- when the broadcast industry started.

Still, not everyone believes a broadcast network appeals to young millennials or Gen-Xers -- the future and potential growth of TV. The median age of the broadcast prime-time audience is 58.7 years old.



But that doesn’t mean young viewers aren’t watching broadcast TV program content on linear TV -- and elsewhere. Just consider CBS, the oldest-skewing TV network. However, when it comes to programming on its streaming ad-supported platform, CBS All Access, the median viewing age is 44.

The key difference transcends age: No demo wants to pay much -- if anything. Consider young TV viewers' digital habits -- YouTube, social-media platforms and other digital media — all free services supported by advertising.

Peacock hasn’t -- as yet -- positioned itself as a younger-skewing or older-skewing platform. Just as a new digital video platform for all.

Verizon offered an initial year of Disney+ free to its existing broadband/wireless customers. And 10 million people came running. Will they remain after a year, paying the $6.99 a month price? Maybe.

Legendary cable TV executive legend John Malone believes once a platform has consumers’ credit-card information, subscribers are likely to hang around, especially at low $10 a month or less prices.

Leaving aside broadband access and electricity payments, there is something to be said about offering TV content as “free.” Is that something NBC will be touting when it comes to its marketing message? Sure, it couldn't hurt.

1 comment about "NBCU's Peacock Revisits TV's Genesis: Ad-Supported".
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  1. Ed Papazian from Media Dynamics Inc, January 14, 2020 at 10:51 a.m.

    Wayne, the key for the broadcast networks as they launch ad-supported SVOD services will be starting with fewer commercials and, due to this, plus the younger viewership, charging very high CPMs. It is not a certainty that a huge portion of the networks' current "linear TV " audience will automatically shift to SVOD as it is heavily weighted to older folks and lowbrows. But if 20% shifts over the course of two or three years and the networks earn double the ad revenue per set of SVOD "eyeballs" that could be a significant revenue boost. Also, as the number of "linear TV" GRPs shrinks those that remain---even with poor demos---will also command higher CPMs. It could be a win, win situation---if handled properly.

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