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Comcast's (CMCSA) Universal Moves Licensing Deal to Peacock

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Comcast Corporation’s (CMCSA - Free Report) movie studio Universal Pictures has entered into a multi-year deal with NBCUniversal’s streaming service, Peacock to exclusively stream its new films within four months of their theatrical debut starting 2022.

The company’s pay TV partnership with AT&T’s (T - Free Report) HBO will expire at the end of this year. Pay-one windows typically cover 18 months of distribution. Per the new licensing agreement, Universal’s films will go to Peacock for the first four months and final four months of the window, while the middle 10 months will permit for non-exclusive licensing to additional partners.

The new Peacock-Universal deal covers all Universal, Focus Features, Illumination, and DreamWorks Animation theatrical releases.

As part of the deal, Universal will reportedly produce exclusive releases for Peacock. The 2022 Universal slate includes Jurassic World: Dominion, Jordan Peele’s new genre pic, DWA’s The Bad Guys and Puss in Boots: The Last Wish as well as Illuminaton’s Minions: The Rise of Gru.

Peacock’s Content Portfolio Set to Heighten Competition

Comcast’s hybrid business (both subscription and advertising) model is expected to have been a key differentiator for Peacock in an overcrowded streaming industry saturated with pure subscription services from the likes of Netflix (NFLX - Free Report) , Disney, Amazon prime video and Apple.

Peacock has three tiers of service: Free, Premium and Premium+. Peacock’s low-cost and ad-based subscription service is likely to threaten Netflix’s dominance in the streaming industry. The free tier offering will help Comcast attract advertisers.

The addition of new content is expected to aid Comcast’s streaming business by increasing consumer engagements. Comcast’s ad-supported streaming service Peacock had 42 million sign-ups until March in the fiscal first quarter 2021.

Peacock’s content portfolio consists of a range of sports content, programming from NBC and Telemundo, and full seasons of shows including The Office, Modern Family, Parks and Recreation, Cheers, among others.

Moreover, Peacock is set to launch a Tokyo Olympics destination featuring live coverage of major events such as Men’s and Women’s Gymnastics and Men’s and Women’s Track & Field. Peacock will also stream live coverage of Men’s Basketball on Jul 25.

Peacock also offers a lineup of around 25 curated digital linear channels, featuring long-form and digital-originated programing content from NBCUniversal's broadcast and cable properties as well as third-party content providers.

Last month, NBCUniversal and Amazon (AMZN - Free Report) inked a deal to make Peacock available on Amazon Fire TV set-tops and Fire tablets starting Jun 24. Amazon and NBCUniversal also inked a distribution agreement for NBCUniversal’s 15 network apps to appear on Amazon Fire TV and Fire tablet devices. These include NBC, Bravo, NBC News, NBC Sports and Telemundo.

Also, earlier in June, Peacock was made available on Samsung Smart TV, which is expected to expand Peacock app’s reach to households nationwide.

Moreover, this Zacks Rank #3 (Hold) company, which has been losing video customers due to cord-cutting, expects Peacock’s solid content to aid its user base in the long haul. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

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