September 29, 2023

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NBC’s Peacock announced its first-ever price hike as streaming losses mounted

NBC’s Peacock announced its first-ever price hike as streaming losses mounted

Another streaming service is about to get more expensive amid the industry’s push for profitability.

Late Monday, Comcast Corporation (CMCSA) announced price increases for its Peacock streaming platform for the first time ever, informing existing Peacock customers that their monthly fee will increase by $1 to $5.99 for the ad-supported Peacock Premium plan and by $2 to $11.99 for mostly ad-free Peacock Premium Plus.

The price increases will take effect on August 17th for existing users, but will be immediate for new customers. The hikes come amid mounting losses streaming into Peacock as content costs have skyrocketed amid heightened competition.

The company said the increases will allow the service to continue investing in user experience and content.

Comcast shares were flat on Tuesday after the announcement.

Comcast said higher programming costs contributed to Peacock’s overall loss of $704 million in the first quarter, compared to a loss of $456 million in the same period last year.

The company saw Peacock subscribers in the US grow more than 60% year-over-year to 22 million, while revenue also rose 45% to $685 million.

“We’re encouraged by our results,” Comcast president and interim CEO of NBCUniversal, Michael Kavanagh, said on the April 27 earnings call. “The results we are seeing give us confidence that we are on the right path for Peacock to break even and grow from there.”

The executive said earlier that 2023 will be the peak year for Peacock losses, and the losses were estimated at about $3 billion.

Cavanagh replaced former NBC global chief Jeff Schell after he was fired in April due to an “inappropriate” relationship with a female employee. At the time, Kavanagh confirmed that there would be no change in strategy as a result of Shell’s ouster.

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SUN VALLEY, IDA – JULY 11: Comcast President Michael Kavanagh (second from left) arrives at the Sun Valley Lodge for the Allen & Company Sun Valley Conference on July 11, 2023 in Sun Valley, Idaho. Every July, some of the world’s richest and most powerful businessmen from the media, finance, technology and political spheres gather at the Sun Valley Resort for the exclusive week-long conference. Kavanagh said earlier that 2023 will be a year of peak losses for Comcast’s Peacock streaming service. (Photo by Kevin Deitch/Getty Images)

Comcast also has to take on a double whammy in Hollywood as actors join writers on picket lines.

The strikes have already disrupted broadcast networks as CBS revealed its plans to rebroadcast “Yellowstone” to help fill out the TV programming schedule in the fall, which will rely heavily on unscripted reality TV shows and game shows.

In another sign of networks scrambling to fill the airwaves, ABC Ms. Marvel, previously broadcast exclusively on Disney+, has announced It will make its broadcast debut in August. ABC is owned by Disney.

According to a new report from Moody’s released Monday, Comcast is among the companies best fronted by strikes, along with Netflix (NFLX), Fox (FOXA), Sony Group (SONY), Amazon (AMZN) and Apple (AAPL). ).

“Major studios, network owners and broadcast networks that are well diversified by business and content type (news and sports) or by geographic production and library and have relatively strong balance sheets are least at risk,” the report said.

Comcast will report second quarter results on July 27th.

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Alexandra Channel He is a senior correspondent at Yahoo Finance. Follow her on Twitter @employeeAnd linkedin, and email it to [email protected]

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