NBCUniversal’s Peacock Wants to Make Advertisers Part of the Streaming Era

NBCUniversal’s formal unveiling of its new streaming service, Peacock, featured as many bird puns as it did statements about the importance of advertising to the TV ecosystem.

That alone sets Peacock, one of three streaming services that will launch this spring, apart from its competitors. But time will tell if Peacock will be able to convince the streaming audience that they’re better off with advertising, considering that many younger viewers have grown up in a world where they’ve largely avoided seeing commercials while viewing their content.

Whereas Disney and WarnerMedia are putting their streaming services at the forefront of their respective businesses, NBCU appears to be treating Peacock as more a supplement to its existing TV division.

“Ad-supported business has been a proven business model for decades,” NBCU chairman Steve Burke said on Thursday. “We’re leaving money on the table as our shows are being watched in places where we don’t monetize well.”

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NBCU does not want to replace its TV business with Peacock, but rather use streaming service to better cater toward its advertisers. The service will offer three tiers of service, two buttressed by advertising. Burke said part of the reason the company is going against the grain compared to its streaming competitors is because the “majority of streaming activity” happens on ad-supported platforms like YouTube.

Peacock will launch first for Comcast Xfinity X1 and Flex customers on April 15, before rolling out nationwide on July 15, just nine days before the Summer Olympics begin. The early rollout comes right after Quibi, the short-form content service from Jeffrey Katzenberg, and a month before WarnerMedia’s HBO Max debuts in May. Since Apple and Disney launched their streaming services last November, Peacock is a latecomer joining a very crowded marketplace.

By bringing advertisers into the fold, NBCU doesn’t have to charge as much as its competitors. The ad-supported approach also gives the company access to revenue streams others are shunning. At least that’s the story Peacock is trying to sell. “The average premium subscription costs $11 a month,” Matt Strauss, who is spearheading Peacock, said. “Increasingly, streamers want alternatives… this represents a growing white space in the streaming market.”

So how will Peacock work? Well, if you’re a Comcast or Cox subscriber, pretty well. Those existing cusomters won’t have to pay anything, while others can pay either $4.99 monthly for a small amount of ads (NBCU execs promised no more than 5 minutes per hour), or $9.99 for an ad-free experience.

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The free option, called Peacock Free, will include next-day access to current seasons of freshman broadcast series on NBC, as well as library content and curated daily news and sports programming. As for Peacock originals, this option only includes “select” episodes, as well as access to what Peacock is calling “streaming genre channels” like “SNL Vault,” “Family Movie Night” and “Olympic Profiles.”

The Premium tier features everything on the Free option but includes all Peacock Originals, early access to late-night series like “Tonight Show” and “Late Night” and more sports including Premier League soccer.

Peacock will have live programming, including news and sports, including same-day broadcasts of “NBC Nightly News” and “Meet the Press” and channels like NBC News Now, Sky News and the new international news channel NBC/Sky Global News. Sports offerings will include live coverage of the Opening and Closing ceremonies for the Olympics, and three daily shows. NBC Sports’ coverage of the Premier League and Ryder Cup will also be on Peacock, on a non-exclusive basis with NBC Sports Gold, the company’s sports-themed streaming service.

“We are creating the equivalent of a 21st century broadcast business, delivered on the internet,” Burke said.

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