Comcast to Double Spending on Its Peacock Streaming Service to Boost Paid Subscribers

(Bloomberg) -- Comcast Corp. plans to double spending on content for its Peacock streaming service this year in an attempt to attract more paying subscribers.

The company will invest more than $3 billion in film and TV programming and expects to ramp that up to $5 billion “over the next couple years,” Chief Financial Officer Mike Cavanagh said on an earnings call Thursday. The investment will be funded in part through cash flow from NBCUniversal’s other businesses, he said.

Peacock has a ways to go to catch up to major streaming services like Netflix, which has more than 220 million global subscribers, or HBO and HBO Max, which have about 74 million subscribers combined. Peacock launched in the U.S. in July 2020 and is just starting to expand internationally.

Peacock continues to lose money. Despite a “significant step up in revenue,” the service’s loss, excluding interest, taxes, depreciation and amortization, could be about $2.5 billion and the higher spending could delay when Peacock breaks even. 

The service had 24.5 million monthly active accounts in the U.S. at the end of 2021. Of that number, more than 9 million were paying subscribers, a number that Comcast disclosed for the first time. The vast majority of paying customers select the $5-a-month plan that includes advertisements. The ad-free version costs $10 a month.

About 7 million people get Peacock free as part of their cable-TV subscriptions, and Comcast expects to convert many of them to paying subscribers over time. Paying customers generate $10 per month in revenue on average, including advertising, Chief Executive Officer Brian Roberts said.

Peacock has a mix of entertainment and live sports programming. Some of its biggest draws are “Yellowstone,” re-runs of “The Office” and Premier League football. Next month, Peacock will broadcast every live event of the Winter Olympics.

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