Peacock, the flagship NBCUniversal streaming outlet that will add NBA games to its lineup this fall, is raising the price of its subscription plans by $3.
Starting next week, Peacock Premium will cost $10.99 a month, up from $7.99, making it the priciest level for any ad-supported service on the market. Premium Plus, which has no ads (except on live sports) and access to local stations, is also going up by $3, to $16.99. On an annual basis, Premium will now be $109.99 and Premium Plus $169.99.
Inflation is increasingly common across the streaming landscape, with consumers feeling the squeeze as media joins other sectors upping prices. The notion of cutting the traditional pay-TV cord in order to save money seems downright fanciful given that signing up for even a modest handful of streaming services can easily result in a monthly tab equal to a cable bill.
Price increases have tracked overall adoption. Streaming in June accounted for nearly 50% of all viewing on TV sets, according to Nielsen, with broadcast networks falling to an all-time low of 18.5%. Even companies like NBCU with both linear and streaming operations are ratcheting up direct-to-consumer prices in a bid to extract profit from streaming after billions of dollars of investment over the past handful of years.
The increasing cost of programming, chiefly sports rights, has also forced subscribers to be asked to bear the burden. NBCU agreed to pay $2.45 billion a year for 11 years for rights to the NBA and WNBA, and is also committed to the NFL for billions more.
Subscriber cancellations often follow price hikes, but the bet from streaming operators is that over time enough subscribers remain aboard to make the margins worthwhile. Eventually, the sting is forgotten. Peacock has lagged the broader market, reaching 41 million subscribers as of the most recent report. NBCU parent Comcast is due to report second-quarter earnings later this month and is apt to provide an update on Peacock’s subscriber growth and progress toward break-even.
Along with a growing menu of live sports, Peacock has also drawn significant viewership for the most recent season of dating reality series Love Island USA. Its scripted originals have not been as consistent, though breakthroughs recently have included Poker Face and Day of the Jackal.
Along with the NBA, Peacock has featured exclusive NFL and Premier League games as well as golf tournaments like The Open (currently unfolding in Northern Ireland). It also has featured the pay-1 window for Universal movies, making Peacock the destination for the likes of broad-audience titles like Wicked and Super Mario Bros.
Vulture’s Josef Adalian had the first report on the price hike.
