Peacock continues its strategic shift, removing access to the free tier for new subscribers

Continuing a strategic shift dating back to 2021, NBCUniversal streaming service Peacock is no longer accepting new subscribers to the free basic tier.

Instead, the signup page for the service only offers plans that cost $5 and $10 per month. From now on, the basic level will continue to be used for existing, registered users.

Peacock, which came into the grip of the pandemic in the spring of 2020, initially faced significant headwinds but trumpeted its potential for ad sales as users could try it for free. (There were also $5 and $10 options at launch.) After switching to paid subscribers in 2021 and de-emphasizing the free tier ever since, the company has managed to surpass more than 20 million subscribers.

When parent company Comcast released NBCU’s financial results for NBCU last week, it noted that Peacock had more than doubled its subscriber base in the past year. However, losses are expected to increase and peak at $3 billion by 2023. The company initially predicted that Peacock would become profitable in 2024, but has not reaffirmed that goal, despite the streamer leading other metrics. When NBCU called an investor day in January 2020, it did not specify a subscriber target, instead asking for 30 million to 35 million monthly active users by 2025, a threshold that has already been met.

The mothballing of the base level for new sign-ups was first reported by The Streamable.

Marketing materials in 2020 touted Peacock as “free as a bird”, a nod to its strategic focus on advertising revenue. While advertising revenue remains a key financial driver, the company has signaled for some time that it is changing course. Steve Burke, who was CEO of NBCU at the time of Peacock’s launch, initially said it would be aggregated at no additional cost to customers of large MVPDs, allowing for scale. The company started out with no deals with Roku or Amazon Fire for direct-to-consumer subscriptions, instead relying on a shared interest with other cable operators. Comcast’s own Xfinity TV and broadband systems were an initial testing ground for this concept, but the company has taken steps over the past year to phase out this bundling initiative.