NBCU's Peacock Launching As Mainly Free, Ad-Supported Service April 15

Confirming reports around its new streaming platform, NBCUniversal’s highly touted premium video service Peacock will launch on April 15 -- largely as a premium free, ad-supported video service with a subscription option -- building to 24 million initial subscribers by mid-July.

In a New York announcement, Steve Burke, chairman-CEPof NBCUniversal, said no company is primarily targeting the premium ad-supported TV market in the streaming business.

“In effect, it’s a white space... For consumers, we think this is the right offering at the right time. We believe affordability will be critical as more subscription services are launched leading to bigger customer bills.”

Burke says ad-supported TV has a proven track record. For example, 250-plus ad-supported linear networks pull in 92% of all U.S. viewers, versus ten pay TV networks with no advertising -- including HBO, Showtime, Epix, and Starz -- which get 8% of the linear TV audience.



Burke says that NBCU doesn’t operate its own third-party platforms -- in contrast to Disney, which owns Hulu -- and that NBCU wants to control its own destiny and revenue-producing platform.

“On-demand viewing has created larger and larger audiences, which is good," he says -- but one challenge is that the network has not figured out  "how to monetize these on-demand audiences as well as we’d like to. In effect we are leaving money on the table.”

NBC’s sister company Comcast, which has cable TV service Xfinity X1, and Flex customers, its wireless package for TV networks, will be the initial regional launch distributor for its April 15 start -- the Peacock premium no-advertising subscription option bundled free to consumers.

Then on July 15, it will expand to include Cox cable TV systems, where Peacock will have a total of 24 million initial subscribers. By 2024, Peacock expects to have 30 million to 35 million active accounts.

Peacock will comprise two products: Peacock Free and Peacock Premium.

Peacock Free will include its ad-supported, free service to consumers, which will include 7,500 hours of programming.

Customers can access current seasons of freshman broadcast series, classic series, movies, curated daily news and sports programming including the Olympics, Spanish-language content and select episodes of marquee Peacock originals.

Peacock Premium will have two options: Peacock Premium, a $4.99/month ad-supported service offering 15,000 of programming; and a second Peacock Premium alternative, a $9.99/month ad-free service.

The Peacock Premium ad-supported service will be bundled into TV packages of Comcast and Cox cable subscribers at no additional cost to 24 million subscribers.

NBC will start with four initial launch sponsors -- Eli Lilly and Company, State Farm, Target and Unilever. Peacock will have the “lightest ad loads” for a premium streaming service -- five minutes per hour or less of advertising content.

In addition, Peacock will provide frequency caps on TV commercials to insure viewers don't endure the fatigue of seeing the same ad too many times.

NBC says initial marketing sponsors will join the Peacock Streaming Council, a group dedicated to building and testing what works with audiences. 

These initial sponsors will be promoting Peacock on their sites, in stores, showrooms, and in their media.

Advertising sponsors will be featured in the hundreds of millions of dollars in Peacock marketing. 

NBC says initial marketing sponsors will join the Peacock Streaming Council, a group dedicated to building and testing what works with audiences.

A number of different advanced advertising capabilities will be offered, including:

ShoppableTV, linking advertising exposure and commerce; “prime” pods, where one marketer can own a single, 60-second pod, all to reduce ad load and interruptions; and “pause” ads, where stopping/pausing on-demand viewing can offer a single, full-screen display ad.

In addition, Peacock will offer “binge” ads, where after three episodes of a show, a sponsor message promotes the fourth episode ad-free; “engagement” ads, which use personalized, interactive experiences such as trivia questions; and “trending” ads, current/topical ad executions for marketers.

Kannan Venkateshwar, media analyst of Barclays Capital, recently estimated by 2025, Comcast could amass $5 billion in revenue from Peacock: $2.7 billion in ad revenues and $2.3 billion in subscription revenues. This would come from a high estimate of 30 million paid subscribers (and 90 million monthly active users) by 2025.

1 comment about "NBCU's Peacock Launching As Mainly Free, Ad-Supported Service April 15".
Check to receive email when comments are posted.
  1. brian ring from ring digital llc, January 17, 2020 at 1:11 p.m.

    Actually I think there are three Tiers. Peacock Free w ads, which is NOT available D2C, Peacock for 4.99 w ads, which IS available D2C, and Peacock Premium, ad-free but also w live sports etc. (Will those live sports be ad-free? I doubt it but don't know.) 

    I'm not the only one confused by the whole thing but I think it's Media Ninja smart of Comcast. It's really smart. Peacock Free isn't free to the distributors - only to consumers!

Next story loading loading..