Could Peacock be the streaming dark horse?

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Wilderness explain NBC's new subscription platform Peacock and consider its benefits.

NBC Universal will launch its new streaming service, Peacock in April of this year. Not another streaming platform I hear you cry. Well, yes, it is.

Though a long time coming, Peacock is an interesting play from the somewhat reserved Comcast-owned NBC. The platform will be overflowing with content, some 15,000 hours on launch, including UXS hits such as The Office, Keeping Up with the Kardashians, Will & Grace, Frasier, 30 Rock, Battlestar Galactica, Parks and Recreation, Law & Order, and Brooklyn Nine-Nine to name but a few.

NBC has also announced a series of original shows and movies including; Girls5Eva (the Tina Fey-produced comedy about a one-hit-wonder girl group from the ’90s that reunites to give their pop star dreams one more shot), Hart to Heart (an interview show starring Kevin Hart), The Capture (which appeared on BBC), Lady Parts (which appeared on C4) and a slew of comedies produced in partnership with Sky Studios, including Intelligence, featuring David Schwimmer.

Comcast will also use the power of its film arm, Universal Pictures, to ensure Peacock has an array of movies to watch. The whole of Universal’s film slate from 2020 onwards will be exclusively available to stream on Peacock including Fast & Furious 9 and Jurassic World 3 and a set of original films and animated series are in development for the platform from Universal and Dreamworks Animation.

Not only that, but Peacock will feature sports including the 2020 Olympic Games from Toyko - its opening and closing ceremonies, three daily Olympics shows, and a live stream of more than 1,000 hours of exclusive coverage from the Tokyo Paralympics. From August, Peacock will have access to 2,000 hours of Premier League coverage in the US and other markets, including more than 140 matches that aren’t available on television. The Ryder Cup golf tournament will also join the service in September.

Along, with TV, movies and sport, Peacock will also host live breaking-news coverage from NBC News' portfolio, as well as original documentaries for Peacock from NBC News on politics, biographies, and history. NBC News also is unveiling an international news network in collaboration with Sky.

Comcast knows that at least initially, Peacock will be a loss-making exercise. However, it’s going to throw all it has at providing a service fit to compete not just with Netflix, Disney+, HBO Max and other streaming services, but also with traditional cable and satellite bundles.

Writing a new playbook

One marked difference about Peacock will be how Comcast hopes to make money from the service. Not only will they be looking for subscriber fees but there will also be an ad-supported version. In fact, Comcast is looking to launch Peacock with a three-tier pricing model: Peacock Free (limited programming with ads), Peacock Light (an ad-supported complete version that is free to existing Comcast customers and $5-a-month for everyone else), and Peacock Premium (a $10-a-month ad-free subscription option that is open to anyone).

With this low-pricing and ad-supported strategy, Comcast is betting the house on streaming, it still believes there’s plenty of mileage in the 80 million cable and satellite customers, but it now has a two-pronged distribution approach.

Linda Yaccarino, chairman of Advertising & Partnerships at NBCUniversal, is responsible for crafting the ad strategy for the streaming platform. She says: "With Peacock, we can throw out the old legacy playbook and write a new one”.

What does that mean? I's about putting into action the things what the NBC's ad team team have been keen to explore; ad transparency and innovative new formats being two key examples. Peacock will include ad formats like the pause and binge-able ads popularized by Hulu, and the shoppable ads that are also available on NBC's TV networks.

If Peacock can appeal to enough consumers who are happy to sit through five minutes of ads per hour then it could be onto a winner. The challenge will come for those who don’t and whether NBC can convince those people to pay $10 a month, when they may already subscribe to one or more streaming services.

A three-card trick

Peacock has three key strengths it hopes will convince enough people to give it a try, at least the ad-supported version for free. Firstly, one of the biggest catalogs of TV shows and movies from any network or studio, major live sporting events, and long-standing licensing deals that should fend off competition.

That is a pretty potent mix and could spell big trouble for Netlfix and the rest. By taking an approach of having a whole slew of content aimed at a broad audience and appealing to those wanting something they know and trust to watch supported by movies and sport means they may become the defacto choice for many households. Those that then like more Premium TV and moves may have a choice to make around Netflix, HBO Max or for those with kids Disney+.

Obviously NBCU has a lot of catching up to do. Netflix has $61M paid subscribers in the US and a staggering 167M worldwide. That is some starting point, but as we’ve seen incumbents fall quickly and NBC’s triple threat in the way of content and the power Comcast can wield to drive down prices will make it difficult in the long run for Netlfix to compete.

Tom Jarvis, founder and managing director at Wilderness Agency.

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