Peacock announces its first ever price hike
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NBCUniversal’s streamer is hiking its price for the first time.
The current premium plan goes for $4.99 a month but will cost $5.99 a month going forward. This plan includes advertising.
For mostly ad-free viewing, subscribers will have to pay $11.99 a month, a $2 hike. The streamer will continue to offer savings for paying for an entire year upfront.
New customers have to pay the new pricing effective July 17, 2023. Existing subscribers will get one additional month at the current rate before the hike starts appearing on bills starting Aug. 17, 2023.
In a statement, NBCU said the price increase will allow it to invest in more content and improved user experience.
Even with the increase, Peacock remains one of the more affordable major streamers. Lower priced streamers include Apple TV+ recently increased its cost to $6.99 a month, up from its original $4.99 price tag, and AMC+, which is $8.99 a month. Discovery+ is $6.99 a month for an ad-free experience.
Most of these services, however, have significantly less content that Peacock, which draws heavily on NBC content (Discovery+ is a possible exception, but its library leans heavily toward unscripted genres, which can be less experience to produce and license).
The new price puts Peacock in line with Paramount+, though that service has significantly more original content thanks to its ability to draw in Showtime programming.
Peacock does, however, have a significant amount of live sports programming — typically around 5,000 hours of content a year.
NBCU is expected to lose $3 billion on streaming in 2023.
Like most streamers, Peacock faces high content, marketing and acquisition costs as well as challenges keeping subscribers from canceling, which can result in high churn rates.
The service has been posting positive growth trends, with 2022 racking up 20 million paid subscribers. During 2021, the service had only 9 million.
Content-related costs continue to be a challenge for streaming as well. Streamers invest heavily (often reaching into the billions of dollars a year) to create and license content.
However, there are signs that the streaming market could be cooling. Disney+ recently announced it was cutting hundreds of titles from its library in order to allow it to write-off those licensing costs.
Streamers typically have to pay a fee just for the privilege of having content available to its subscribers plus, depending on its agreements with production companies and studios, royalties each time a film or show is viewed (for ad-supported plans, this can involve splitting ad revenue).
Many consumers are also growing wary of the cluttered streaming market, including becoming wary of committing to more monthly subscription costs.
Showtime and Paramount+ announced plans to integrate operations in January 2023, which resulted in cost savings. Warner Bros. Discovery is also moving forward with plans to integrate Max (recently rebranded from its original HBO Max name) and Discovery+ into the same interface, though it will continue to sell subscriptions to Discovery+ separately.
Password sharing continues to be a challenge for streamers, though so far only Netflix has taken significant steps in acknowledging the issue and attempting to monetize additional users. Most other streamers do limit the number of simultaneous users who can watch content at any one time, which effectively limits password sharing to some degree.