Paywall Playoff Game

Well, this was bound to happen, and I couldn’t hate it more. I am coincidentally heading to Las Vegas wildcard weekend (for the first and last time in my life), so I will be able to see the game if it’s the Rams (which I don’t think it will be). But this is just the beginning. They are gonna make us pay to watch playoff games in the future.

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Will an NFL playoff game get you to pay for streaming? NBC’s Peacock is about to find out

You are soon to be part of yet another sports consumer experiment: How badly do you want to watch an NFL playoff game?

Executives at the NFL and NBC’s Peacock streaming service believe that at least a significant number of you will be interested. It’s why Peacock, first reported by The Wall Street Journal and confirmed by The Athletic, paid the NFL an estimated $110 million to air the first-ever exclusive, live-streamed NFL playoff game on Jan. 13. The Peacock wild-card game will be played in prime time and the NFL will announce the teams upon the conclusion of play this Sunday. NBC stations in the two competing team cities will also air the game. It will also be available on mobile devices with NFL+. Play-by-play voice Mike Tirico, analyst Jason Garrett, reporter Kaylee Hartung and rules analyst Terry McAulay will be on the call.

“Sports is a big part of our overall strategy at Peacock, and sports is not substitutable,” said Rick Cordella, the president of NBC Sports, who also oversees sports on Peacock. “We know that people will come for the game and are willing to pay a subscription price for the game. Sports has sort of been the catalyst to get people in the door to Peacock and then exposed to all the other great content that we offer. It’s a continuance of that existing plan we’ve had for three years. We’re incredibly excited about what the audience numbers may be and what we can do with it.”

It’s the second Peacock exclusive game in less than a month — and it certainly won’t be the last streaming-only NFL game over the next decade. Peacock’s first exclusive NFL game, which saw the Buffalo Bills defeat the Los Angeles Chargers on Dec. 23, averaged 7.3 million viewers based on Nielsen fast nationals. It was the most watched program on that day, which is usually the case for NFL live-game inventory. The game peaked at an average of 8.4 million viewers from 10:45-11 p.m. ET during the NFL’s first-ever commercial-free fourth quarter.

For context, that number was significantly lower than the average Amazon Prime NFL broadcast in 2023. “Thursday Night Football” averaged 11.86 million viewers in 2023, up 24 percent from 2021 (9.58 million) thanks to a much better schedule than previous years.

Peacock continues to lose money, as is the case with most streaming entities. Comcast CEO Mike Cavanagh said last month the platform would hit $2.8 billion in losses in 2023. The hope is $2.8 billion represents peak losses.

Still, even with the costly price for sports media rights, the belief from media executives remains that sports can lead to long-term subscriber growth. Peacock currently has 30 million subscribers and a host of sports properties, including “Sunday Night Football” (which airs simultaneously on NBC), college football, Premier League soccer, NASCAR, the Olympics and the WWE among others. Comcast said subscriptions to the service were up 75 percent over last year.

Daniel Cohen, the executive vice president of global media rights consulting at Octagon and someone whose job is to monitor the evolving media landscape, likes what Peacock is doing with the NFL wild-card game.

“It’s a sound and proven strategy that has worked for decades regardless of platform — exclusivity of Tier 1 live sports driving mass audience aggregation,” Cohen said. “Sports fans will go where the content goes. We can all see the future of live video consumption is via streaming and not a co-ax cable. In fact, Octagon’s media rights group predicts video streaming consumption will overtake traditional TV consumption by 2028. The key will be to expose the first-time purchasers to the other benefits of Peacock while they are locked in the playoff game.”

Skeptics, and there are many, would argue that this represents a very pricey attempt at subscriber acquisition. The reality is one-time purchasers for the wild-card game can cancel after the game (after shelling out $5.99 for a premium plan), and no doubt some will. How can the economics work? Cohen says businesses such as Peacock must have a long-term retention strategy that coincides with exclusive offerings like the one on Jan. 13. He said subscriber churn and piracy are the two biggest challenges facing subscription video-on-demand growth in the U.S.

As for the price Peacock paid, Cohen said there is nothing like the NFL to aggregate eyeballs. He cited last year’s six wild-card games across Fox, NBC, CBS and ABC/ESPN/ESPN2, which averaged 28.8 million viewers. To that end, you’ll see ads for new Peacock shows during the wild-card game including “Ted,” the new Seth MacFarlane series based on the movie franchise, and Season 2 of the reality show “The Traitors.”

Cordella said he will judge success on the quality of production (the NFL product on NBC Sports always rates high here) and if the technological distribution is smooth and clear.

“Then you get into some of the metrics as far as how many subs does it drive, how many new subscribers will we have, did we meet our own internal traffic goals, did we pay off our advertising partners,” Cordella said. “I think the overall story will be told months down the road. How many people churned out after one month and how many folks stayed and watched other content on Peacock? It’s not a Sunday morning pass-fail grade. Months down the road, did this have the intended consequence of building the Peacock platform? That’s how we’re going to view it.”

So, will you watch? We’ll learn the viewership of the Peacock game come the week of Jan. 15.