NBCUniversal’s Steve Burke on Streaming Wars: ‘This Is a Moment in Time’

Cynthia Littleton

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NBCUniversal chief Steve Burke predicts that things are going to get even more intense among the media and tech giants launching streaming platforms before the marketplace inevitably settles down.

Burke, speaking Thursday morning on Comcast’s third quarter earnings call, said NBCUniversal is committed to its strategy of launching into the streaming arena with the advertising-supported Peacock platform in April. Unlike Disney and AT&T, NBCUniversal is not taking dramatic steps to hold back its movie and TV productions from third-party sales in order to supply their platforms — Disney Plus and HBO Max, respectively — with high-wattage exclusive content.

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“We’re not doing the same strategy that Netflix and people chasing Netflix have adopted,” Burke told Wall Street analysts. “We’re working within the existing eco-system where there is a lot of (advertising-supported VOD).”

The Peacock service will also be bundled into Comcast’s Flex streaming content service that debuted in March and is aimed at Internet-only consumers. Comcast at first sought to charge a $5 monthly fee for Flex but switched in September to giving the Flex set-top box and voice remote free to all broadband customers.

Burke said the advertising-supported strategy made sense given the heat of competition of paying subscribers and the content spending required to stock a service to make it worth a monthly fee to consumers. The free elements of Peacock also play to NBCU’s strengths as the largest provider of TV advertising in the U.S. However, viewers that want broad access to Peacock programming will still require a traditional MVPD subscription.

“It cuts our investment pretty substantially,” Burke said. “I think we’re going to get to cruising altitude much more quickly than a subscription service.”

Burke reinforced that NBCU still intends to “keep selling to other companies.” He cited Universal’s longstanding movie output deal with HBO as an example of the types of outside licensing deals that NBCU will still seek. Peacock will serve up a mix of original series, exclusive library content — NBCU shelled out big bucks to reclaim the streaming rights to “The Office” from Netflix starting in 2021 — and non-exclusive offerings.

The NBCU chief acknowledged that the environment for producing content and marketing new services is overrun with competitors with deep pockets.

“You’ve got the three biggest media companies — Disney, Time Warner {now known as WarnerMedia} and NBCUniversal all launching” platforms, he said. “This is a moment in time when a lot of people are being very, very aggressive about it. I would anticipate that there will be an inevitable slowing down and shaking out and the market will get more rational.”

NBCUniversal won’t do much consumer marketing until about a month before the launch, Burke predicted. After Peacock is on its feed, the company plans to use the platform of the summer Olympics in Tokyo as an “after burner” to drive awareness. The stakes are high to be visible, he said.

“As consumers choose, you want to make sure to get in there and make sure your service is one of their handful of favorite services,” Burke said.

Comcast chairman-CEO Brian Roberts said during the call that he was gratified to see the continued integration of Comcast and NBCUniversal operations as well as those of Sky, the U.K./Euro satcaster that Comcast acquired last year.

Roberts pointed to Comcast alum Matt Strauss’ move to Peacock as chairman earlier this month and the streaming expertise that NBCU is tapping into from the Sky team as examples of the conglomerate pulling together. Sky and NBCUniversal are collaborating on a first wave of co-productions, and the two entities are increasing sharing sports content in addition to developing plans for a global news channel.

“The integration is one of the real highlights that makes this company unique,” Roberts said.

Among other highlights from the call:

** Burke said he expects “to make real progress” in raising subscriber fees for MSNBC and retrans coin for Telemundo as key carriage deals for NBCU channels expire with major MVPDs over the next 12 to 24 months.

** Burke talked up the progress at the Universal Studios theme park set to open in Beijing in 2021. Burke said he and Roberts recently visited the location. “It’s going to be a spectacular park,” he enthused.

** NBC News has been in the headlines during the past few weeks amid the publication of “Catch and Kill” by investigative reporter Ronan Farrow. Farrow is harshly critical of NBC News and its handling of his reporting on sexual assault allegations against Harvey Weinstein during his time as a correspondent for the news division. NBC News has strongly denied many of Farrow’s assertions, even offering point-by-point detailed responses. However, the controversy surrounding NBC News was not raised on the hourlong conference call.

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