Peacock Leads All Premium Streamers in Ad-Supported Subscribers; Is that a Good Thing?
While many analysts and customers have been left scratching their heads over NBCUniversal's strategy behind the launch and management of its streaming service Peacock, apparently at least part of the company’s plans are working better than anyone on the outside realized.
According to data from research firm Hub Entertainment and reported by Media Play News' Erik Gruenwedel, Peacock’s unique ad-supported and ad-free hybrid hierarchy has led to the highest number of ad-supported users amongst premium streamers that have an ad-supported video-on-demand (AVOD) option.
When NBCU issued its latest report to investors following the first quarter of the year, the company reported that Peacock had 28 million active users, including 13 million on paid subscriptions. However, the Hub data indicates that just 20% of Peacock’s customers pay the top-tier price for a completely ad-free experience.
The streamer has a complicated labyrinth of subscription options, in no small part due to its integration into Xfinity cable bundles. Not only is a limited, ad-supported version of Peacock available to anyone, but the premium ad-supported version of the service is also offered for free to Xfinity cable subscribers — though NBCU plans to end that practice in the future.
Additionally, Peacock Premium offers two different pricing levels to subscribers, ad-supported for $4.99 per month and Peacock Premium Plus (ad-free) for $9.99 monthly — Xfinity subscribers can get Premium Plus for $5 on top of the base Premium package offered for free as part of their cable subscription. All of the different subscription options have made it difficult for even NBCU to nail down exactly how many subscribers and users the platform has on each of its myriad different subscription levels and how many they would have if (and apparently when) the Xfinity integration ends.
However, when looked at in totality and compared to the other major players in the premium AVOD space, Peacock has by far the lowest percentage of ad-free customers. After launching an ad-supported tier just over a year ago, HBO Max has the largest ad-free vs. ad-supported disparity with corporate sibling discovery+ sitting as the only streamer also above 50%.
Whether having 80% of your customer base on a free or lower-cost plan is ultimately a good thing or not for Peacock, is yet to be seen. With all of the different subscription machinations that customers have to go to in order to land on the right streaming option makes it difficult to truly understand how many of Peacock’s 28 million users would engage with the platform were it not a pre-loaded part of something that they are already paying for. However, as an ad-delivery endeavour, it appears to be working for NBCU; so much so that Netflix has discussed partnering with Comcast (Xfinity and NBCU’s parent company) about helping with their eventual AVOD rollout.
NBCU executives have long maintained that their streaming strategy has thus far been a success, and that the multi-pronged approach to Peacock’s expansion has gone even better than planned. And, to their credit, recent studies indicate that the streamer will be available to more than 64 million users by the end of the year, which cannot be a bad thing from both a subscription and ad-revenue perspective.
Peacock
Peacock is a subscription video streaming service from NBCUniversal that includes original shows, blockbuster movies, and classic television series. Peacock is home to “Yellowstone,” and “The Office,” as well as original hits like “Poker Face” and “Bel-Air.” You can also watch live sports including NFL, MLB, WWE, Olympics, Premier League, NASCAR, French Open, College Football and Basketball, and PGA Tour. Premium Plus subscribers can stream their local NBC feed in all 210 markets.