NBCU Shifts Peacock Focus From Free to Paid Tier, Finally Reveals Subscriber Count

Peacock is still free, but NBCUniversal really wants you to pay for it. Last quarter, Comcast and NBCUniversal’s top executives dodged specifics when it came to giving investors an update on its streaming service. But during the company’s fourth-quarter earnings call today, NBCUniversal broke out its streaming service’s subscriber numbers in greater detail than ever before. The streamer now has 24.5 million monthly active accounts, up from the 20 million metric that the company last reported in July. At the time, NBCU also said that 54 million people had signed up for the service, but the company did not share an update sign-up number—in part because it is shifting its focus from growing users of Peacock's free-tier to building the paid Peacock Premium offering. Comcast CEO Brian Roberts said that Peacock has over 9 million paid subscribers, with an additional 7 million coming from bundles with the company’s Xfinity service and other distributors such as Cox. That's the first time NBCUniversal has ever disclosed the number of Peacock's paid subscribers, who are paying at least $5 per month. Peacock Will Livestream All of NBCUniversal’s Winter Olympics Coverage When Peacock first debuted in the summer of 2020, its emphasis was on free, free, free. “Our vision was to launch a streaming service that offers premium content as supported primarily by advertising,” said Roberts. Back then, “we believed that the free AVOD product would be our most popular and our leading product,” said NBCUniversal CEO Jeff Shell. “And what we found is the consumers are voting with their feet. ... We haven't really focused on paid subscribers and we're already over 9 million people paying us real money.” While the company believes it started with the right business model, Roberts said its paid subscribers have “much lower” churn and “significantly higher” engagement. “We think the most valuable end stake for Peacock is to have two revenue streams,” said Roberts. “We are committed to reallocating and increasing investment … to drive further growth in paid subscribers, which we believe is the right path to creating long-term value.” Peacock’s paid Premium tiers cost either $5 a month or $10 a month for the ad-free offering, and according to the company, the “vast majority” of subscribers are opting for the ad-supported premium tier. At Peacock’s investor day in January 2020, executives said that Peacock aimed to attract between 30 million and 35 million domestic customers by the end of 2024, with an average revenue per user of between $6 and $7, and would break-even that same year. The streamer has now reached approximately 75% of that customer target for 2024, though execs said the break-even timeline will likely be pushed back. “We think that the peak investment year will probably be ’23 based on our plans, and then the revenue growth will overtake the investment growth and will start turning positive,” said Shell. Doubling Peacock content spend Comcast plans to double spending on Peacock content to $3 billion this year—ramping up to $5 billion over the next couple of years—and some of that increased spending will be incremental while some will be a reallocation from linear. According to Roberts, over 300 million hours of content is consumed on Peacock per month. One big way that NBCUniversal hopes to add Peacock Premium subscribers: the Winter Olympics. Peacock will livestream all of NBCUniversal’s coverage of the Winter Olympics, which will be held Feb. 2-20, on its premium tier. Customers that sign up for Peacock’s free tier will have only access to on-demand highlights and select live coverage via Peacock’s daily studio shows. The Games are fast approaching, as is Super Bowl 56 on Feb. 13. So it’s pretty shocking that execs barely mentioned two of the biggest tentpole events of 2022 during its earnings call. Execs previously said that so far, nearly 100 advertisers are lined up for the Winter Olympics, which the company has said is on par with where NBC Sports was at this point heading into the Games in Pyeongchang, and the company only has "a few" ad units left for Super Bowl 56, which are selling for as much as $6.5 million per 30-second spot.