1.  Peacock Looks Like A Winner

Peacock, NBCU’s new streaming service which is more of a FAST than a Flix (pricewise, anyway), seems to be resonating with viewers. The service has signed up 10 million viewers since April, more than doubling the numbers HBO Max is reporting (4.5 million.)

Why It Matters

10 million is an impressive number, given that Peacock is not available on Roku or Amazon, which means that viewers will either have to find it on their VIZIO or LG smart TVs, Comcast X1 set top boxes or smartphones, tablets and laptops. 

It also seems to be proof that NBCU made a very smart bet by emphasizing the free version when it rolled out this month. And by “emphasizing” I mean that were I not a TV industry analyst, I’d have had no idea there even were two paid options—nothing about it was mentioned during the signup process, which, if anything, kept stressing that I did not need a credit card, just an email address.

It’s not hard to see what Jeff Shell and his team were thinking: without the Olympics and a significant amount of original programming, it was going to be hard to get people to spend money on yet another paid SVOD service. Especially given how rapidly the economy is cratering. 

So why not promote the free version, which is half a staircase up from the rival FASTs in terms of content offerings, get their email addresses, get them watching the service, and then, when times are better, try and upsell them on one of the paid versions when there is an actual reason (2021 Olympics, new series) to subscribe.

It’s not like they were going to make much on all those $5 subscriptions anyway. 

That move looks even more prescient when you compare Peacock’s numbers to HBO’s. Max needs to get people to pony up $15/month, which is way more than any other service, and that’s a big ask, especially when there are so many other options.

What You Need To Do About It

If you’re Bob Bakish and the rest of the crew at ViacomCBS or Dave Zaslav and the Discovery team, some good learning here about what to do if you’re launching a major OTT app in the midst of a pandemic.

If you’re Warner, might be time to ramp up production on the ad-supported version of Max.

If you’re a viewer and you haven’t checked out Peacock yet, it’s definitely worth your while.

And if you’re an advertiser and you placed an early bet on Peacock, congratulations on making the right call. 

2. Questioning HBO’s Latest Stats

HBO has been trumpeting the fact that users spend 70% more time on HBO Max than they did on HBO. On the surface this sounds like an impressive stat, but there may be more to it than meets the eye.

Why It Matters

As I’ve been saying for a while, Max is a tough sell to new subscribers. People have had 30 years to decide whether they like HBO enough to want to subscribe, and right now there are around 34.6 million people who have decided they do. 

Those people are willing to pay $15/month just for what HBO has to offer, and may not be all that interested in watching Friends, which is likely why only 4.1 million of them (around 12%) have actually bothered to make the switch to Max, even though the price is identical.

Old School HBO was a unique experience in that people generally used the app to watch specific shows, either live or on demand. That could have been a one hour dip to watch Westworld or a five hour Sopranos binge session. 

Max, which currently offers a wide-ish array of library content, is more like Netflix, a mix of lean-in and lean-back and right now everything that’s new is of the lean-back variety.

Which means the people who felt it was worth the switch to Max were likely looking for “Not-HBO” content, things like Friends and Big Bang Theory reruns (currently number one and number three on the service) and the like.

While there’s some original programming on Max now, it’s also decidedly “Not-HBO”. Love Life (the number two rated show on Max) is a rom com, about which Indiewire’s Ben Travers noted “Anyone worried HBO Max wouldn’t be easy to distinguish from HBO should have their fears settled on launch day...Its first scripted, live-action, Emmy-contending, HBO Max original, “Love Life,” would never pass muster on premium cable.” (Travers gave the series a D+.)

So there’s that and the fact that according to Warner, 23% of Max subscribers are between the ages of 18 and 24.

Which leads to the bigger question: will Max be able to retain all of those 30 million plus current HBO subscribers who have not yet signed up for Max? 

It’s a tough call and will largely depend on what Max’s post-pandemic programming slate looks like. If there are enough Old School HBO-like series, then it should keep those 30 million fans satisfied. If not, there are all the other Flixes, many of whom (Netflix) are doing a good job of out-HBOing HBO.

None of which cost $15.

What You Need To Do About It

If you’re Warner, you need to hope that your plan to turn Max into a mass market play is the right one. There’s no reason to think that there won’t be a need for something that seems more like a broadcast network than a premium network, it’s just that $15/month is a lot of money if you’re not planning to offer both premium and broadcast quality programming. 

If you’re one of the other Flixes and you’re wondering what’s popular with 18 to 24 year olds with money to burn, take a look.

If you’re an investor or an analyst, remember that these current activity stats likely represent a specific type of use (often known as a “superfan”) and so should be treated with several grains of salt.