Comcast to Launch Peacock on April 15, Targets 30M Subscribers By 2024

Comcast executives see Peacock's hybrid model, which combines subscriptions and advertising, as a differentiator in a crowded streaming market.
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Comcast may be late to the streaming game, but it’s aiming to cast a wide net.

The cable giant on Thursday unveiled Peacock, its streaming service due to launch in April 2020, giving details on pricing tiers, content mix and the business plan behind the forthcoming service. Shares of Comcast  (CMCSA) - Get Report ticked up 0.21% to $46.87 in after-hours trading.

Peacock comes in three total iterations: A free, ad-supported tier with a more limited range of content; a $4.99 premium, ad-supported tier with the full scope of Peacock content; and an ad-free premium tier that will cost $9.99 per month. Peacock will launch on Comcast’s Xfinity X1 and Flex video platforms on April 15, followed by a broader national launch on July 15. Peacock Premium will also be free for some 24 million Comcast customers.

Comcast sees its content mix, which will leverage its proprietary assets as well as some content from third-party studios, as Peacock’s key differentiator in an increasingly crowded market.

Matt Strauss, Comcast’s chair of Peacock and NBCUniversal digital enterprises, said on Thursday that Peacock is built to address “multiple points of friction when it comes to streaming...content fragmentation, endless scrolling and subscription fatigue.”

Strauss described Peacock as the only place where streamers will be able to easily access a mix of television shows, movies, sports and news coverage. Executives likened Peacock to both a technology platform with appeal for advertisers and a broadcast network in terms of the variety of content. 

“NBCU is a content powerhouse and Peacock is a natural – even an inevitable – extension of the business,” said Mike Bloxham, SVP of global and entertainment at research firm Magid. “The free ad-supported model is not a surprise and it leans heavily into what Magid’s research shows is a growing level of acceptance of ad-supported services among consumers.”

Comcast showcased a sampling of Peacock content, which will include a wide range of past and present content from NBCU, the 2020 Summer Olympics, NBC’s various news channels, Telemundo and other Spanish-language programming, and numerous originals and exclusives. Some of the Peacock original shows will include Tina Fey-produced “Girls 5Eva” and “Brave New World,” a drama starring Demi Moore.

On the advertising side, Comcast described its hybrid subscription and advertising model as another differentiator in a market that’s already saturated with pure subscription services.

Executives called out a few select “launch sponsors” for Peacock that have already committed to spending hundreds of millions on Peacock ads over the next few years. Those advertisers include Unilever, Target and others.

“Hybrid business models are here to stay and this launch proves advertising and subscription are better together,” added Gideon Gilboa of Kaltura, an online video platform. “And with the right data and user targeting both advertising revenues subscription upsell can grow.”

Reiterating prior commentary, Comcast expects to invest $2 billion in Peacock over the next two years, largely in technology, marketing and programming, and that Peacock will break even by 2024. It set a target of between 30 and 35 million active accounts by that time; after that, Peacock will generate “significant and growing profitability,“ according to Strauss. He said Peacock will be initially focused on the U.S., but international expansion will be evaluated on a market-by-market basis.

With Peacock, Comcast joins Netflix  (NFLX) - Get Report, Disney+  (DIS) - Get Report, Apple TV+  (APPL) , Amazon  (AMZN) - Get Report Prime Video and others in the streaming market. AT&T  (T) - Get Report WarnerMedia’s HBO Max is also due to launch in May 2020.