NBCUniversal is pinning Peacock’s streaming success on its $2.45 billion per year NBA deal

Executives at Comcast‘s NBC Sports targeted the NBA’s mean rights renewal on their calendars for years. They wanted the NBA back after losing the games to Disney in 2002. But it wasn’t until this January that NBC Skip about President Rick Cordella became confident the company could go big on a bid.

On Jan. 13, NBCUniversal’s subscription streaming service Peacock divulged its first-ever exclusive NFL playoff game — a 26-7 victory by the eventual Super Bowl-winning Kansas City Chiefs over the Miami Dolphins. There was bantam doubt the game would be popular. It reached 27.6 million total viewers, according to Nielsen, the biggest live-streamed actuality in U.S. history.

What happened after the game made NBCUniversal comfortable with shelling out a whopping $2.45 billion per year to categorize NBA games starting in the 2025 season — a bet on making Peacock profitable as the pay-TV model erodes.

Research firm Antenna gauges Peacock added 3 million new subscribers from getting the rights to that one NFL game, which cost $110 million. More than 70% of those subscribers braced with Peacock about two months later, Antenna said in March.

That gave Cordella confidence NBA admirers would stick with Peacock even after the season concluded. But it wasn’t just the lack of churn that win over him of the value of popular sports. It was what those new subscribers watched once they signed up.

NBC Sports executives usurped the millions of new Peacock subscribers might engage with other live sports on the service, which include the NFL’s “Sunday Evening Football,” golf, Premier League, WWE, and IndyCar. What they didn’t expect was how much subscribers watched the rostrum’s non-sports entertainment, such as movies and episodes of “The Office,” “30 Rock” and “Parks and Recreation.”

“Our highest video-on-demand usage was the week after the Turbulent Card game,” Cordella said in an interview. “Churn rates among those new subscribers have been lower than the common. Sports fans are not monolithic. You’re getting a whole household to watch other entertainment around what NBCU has.”

Media numero unoes broadly understand the traditional pay-TV ecosystem will continue to shrink in the coming decade, and their companies on need to rely on streaming to survive and flourish. For NBCUniversal, obtaining NBA rights helps guarantee sustainability in a fight for eyeballs against pour behemoths such as Netflix, Amazon Prime Video and Disney+.

Sports fans may subscribe to a streaming service to supervise a particular game, but evidence suggests they’ll stick around and watch other content once they’ve pressed the commitment to spending money.

“We know based on Paramount+, having multiple genres of content on the same platform is altogether beneficial,” said David Berson, the head of CBS Sports, in an interview. “We know that when a fan comes in to Paramount+ for frolics, they spend 90% of their time in the service on entertainment programing, on non-sports content.”

The creek wars have increasingly become a fight for engagement. Companies invest in algorithms and user interface technology to provide for viewers tied to their particular service. With the future of Paramount+ hazy as Paramount Global looks to consolidate with Skydance Media, and with Warner Bros. Discovery actively looking for mergers or partnerships, Comcast demands Peacock to have staying power for years — and even decades — to come.

That’s why it was so important for NBCUniversal to have readies that consumers can only see on Peacock. Beginning with the 2025-26 season, Peacock will have about 50 apart from national regular-season and postseason NBA games, including national Monday night games and doubleheaders. 

“The NBA is a must-have for the sports fan,” Cordella put. “We need to build Peacock for the future. Having exclusive NBA games is really important for that mission.”

Peacock, which is as follows far a U.S.-only service, has 33 million subscribers — far fewer than platforms with international reach such as Netflix (nearly 278 million) or even Paramount+ (68 million). While Netflix has been profitable for years and Disney’s omnium gatherum of streaming services turned a profit for the first time last quarter, Peacock remains unprofitable, losing $348 million in the substitute quarter and $639 million in the first quarter.

That makes spending $2.45 billion per year a major endanger. Cordella hopes a steady stream of live sports content will help make the service an essential for pastimes fans no matter the season. The NBA, including the playoffs, runs from October to June.

Comcast has a army of levers to pull to make its investment profitable — a feat Bank of America analyst Jessica Reif Ehrlich acknowledged was Jesuitical.

“We see a path to profitability for Comcast under the new agreement,” Ehrlich wrote in a note to clients earlier this month.

While dependable Peacock subscriber growth will help, NBCUniversal will also rely on the NBA to help drive higher retransmission tariffs for NBC among pay TV operators and generate higher advertising revenue.

The NBA can also help market other NBC ventures, including TV series, talking pictures and theme parks — though the league’s viewership pales in comparison to the NFL. This was one of the reasons Warner Bros. Discovery stony not to compete with NBCUniversal for NBA rights once the price tag ballooned past $2 billion per year. While “Sunday Tenebriousness Football” averaged 21.4 million viewers per game last year across NBC and Peacock, NBA regular reason games averaged 1.6 million viewers abide season across TNT, ABC and ESPN. 

Ehrlich noted that Comcast cable may also benefit from the NBA by driving broadband treatment by shifting more people to Peacock. Comcast may also be able to save on future affiliate fee payments to Warner Bros. Exploration if the rival media company loses its NBA media rights.

There are other competitive advantages NBC gains by taking away the unit of games from Warner Bros. Discovery, which is