NBCU's Peacock starts to stream into Europe

Peacock's expansion into Europe gets underway this week, as NBCUniversal's premium streaming service will begin a "soft launch" with Sky TV and NOW customers in the UK and Ireland on November 16.

Starting Tuesday, those customers will start to get free access to the premium, ad-supported version of Peacock, a streaming service that launched across the US on July 15, 2020, following an earlier preview with Comcast customers.

Figure 1: Following an initial rollout in the UK and Ireland, Peacock will be launched to other Sky territories, including Germany, Italy, Australia and Switzerland, in the coming months.
(Image source: NBCU)

The Peacock service for Sky subs will include access to Peacock originals, such as Saved by the Bell and The Girl in the Woods; a catalog of current and classic TV shows, including The Office and Parks and Recreation; and a menu of movies that include Fear and Loathing in Las Vegas and Hannibal.

NBCU said Peacock will be rolled out to other Sky territories, including Germany, Italy, Australia and Switzerland, in the "coming months." Peacock, the programmer said, will be available to nearly 20 million Sky customers when the deployment is completed.

Peacock's expansion into the UK and Ireland comes more than a month after Sky introduced a set of streaming TV models under the "Sky Glass" brand that is powered by Comcast's global software platform and will feature Peacock and other streaming apps.

For further expansion into Europe, NBCU and Comcast have connected with ViacomCBS on a new service called SkyShowtime that will feature content from Sky, NBCU, Universal Pictures, Peacock, Paramount+, Showtime, Paramount Pictures and Nickelodeon. SkyShowtime is expected to launch sometime in 2022 and reach more than 20 European markets.

Seeking scale

NBCU will look for this initial expansion into Europe with corporate cousin Sky to add scale and juice up usage numbers for Peacock, which had 54 million "signups" at the end of Q2 2021. The company did not announce a new signup total at the end of Q3, though NBCU CEO Jeff Shell did say on the Q3 earnings call that Peacock "added a few million more subs" and more monthly active accounts in the period.

NBCU has not broken out how many of those signups are for the free, ad-based version of Peacock, Peacock Premium (ad-supported with a bigger content library for $4.99 per month, or Peacock Premium Plus (ad-free, for $9.99 per month). However, NBCU execs have said that advertising is the main source of Peacock revenues early on.

Peacock is "way ahead of where we expected to be at this point," Shell said.

Peacock pulled down $230 million in revenues in Q3, up from $41 million in the year-ago quarter. But Peacock remains far from the black, as it also swung to an adjusted loss of $520 million in Q3, versus an adjusted loss of $233 million in the year-ago period.

Changes afoot?

Richard Greenfield, analyst with LightShed Partners, surmised in a recent blog post that Peacock's ARPU is in the neighborhood of $3.56, well below a target of $6 to $7. That, he said, is due in part to a "heavy skew" toward Comcast and Cox Communications customers who do not pay extra for the ad-supported Peacock Premium service, as well as a sizable group on the free Peacock service that don't get access to the platform's exclusive content.

"If the key problem is not having enough paying subs (beyond Comcast/Cox subs who get it for free) and engagement to drive advertising ARPU, the clear answer becomes Peacock needs far more content than it is currently offering," Greenfield wrote, suggesting that all major programming at NBCU should air first on Peacock. "To be clear, Peacock CAN be successful as a hybrid advertising/subscription service. However, NBC Universal needs to put dramatically higher investment spending into Peacock."

There are signs that Peacock will undergo significant changes in 2022. Business Insider reported that NBCU is mulling a "relaunch" of Peacock in 2022 focused on "mass premium customer acquisition" and a revamp of the service's interface. The grander aim is to position Peacock as a "top 4 must-have" SVoD service, the report added, citing details of a leaked strategy deck.

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— Jeff Baumgartner, Senior Editor, Light Reading