Comcast/NBCUniversal will soon join the ranks of media companies distributing content directly to consumers through streaming services. But for Comcast, the move isn’t really about subscription revenues.
Comcast CEO Brian Roberts, speaking at the Morgan Stanley Technology, Media and Telecom Conference, said his company has yet to achieve all its ambitions regarding targeted, direct advertising.
“We still do most of [our advertising] through the broadcast and cable technology where we all experience the same thing,” said Roberts. “We’re not giving you an intelligent ad. These streaming platforms have that capability.”
Comcast is planning to launch its ad-supported streaming service in 2020. The service will draw on NBCUniversal’s content library along with licensed content and original programming. It will run on top of Comcast and Sky’s technology platforms and will be made available at no cost to NBCUniversal’s pay TV subscribers in the U.S. and international markets. Comcast Cable and Sky will provide the service to their combined 52 million subscribers.
NBCU said it will also sell an ad-free version of the service, but it did not disclose how much that option will cost. The company also plans to sell subscription access to the service for non-pay TV customers.
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Roberts said that the new streaming service will provide another outlet for NBCUniversal’s content creators to better monetize series and films.
In terms of potential pressure for NBCUniversal’s licensing revenues as it goes direct-to-consumer and possibly pulls back some of its content from third parties, Roberts said the impact won’t be dramatic.
Roberts said that Comcast/NBCU has an “awful lot of content” and that while some of it may monetize best on the company’s upcoming ad-supported platform, some of it may continue to make the most sense as licensed content for third-party platforms.
He said Comcast isn’t planning to go “cold turkey” on licensing like some of the company’s competitors. An example of that is Disney and the company’s plan to pull back its films from streamers like Netflix so it can offer them on Disney+ when it launches later in 2019.
Roberts said it’s been able to triple EBITDA at NBCUniversal since it acquired the company, in part due to its licensing arrangements. He said his company will still license content to cable and broadcast as well as streaming platforms.