Another streaming service is about to get more expensive amid an industry push for profitability.
Late Monday, Comcast (CMCSA) announced price increases for its Peacock streaming platform for the first time ever, notifying existing Peacock customers that their monthly fee will increase by $1 to $5.99 for the ad-supported Peacock Premium plan and by $2 to $11.99 for the mostly ad-free Peacock Premium Plus tier.
The price increases will go into effect on August 17 for existing users but will be immediate for new customers. The hikes come amid mounting streaming losses for Peacock as content costs skyrocket amid escalating competition.
The company said the increases will allow the service to continue to invest in user experience and content.
Comcast stock was flat on Tuesday following the announcement.
Comcast said higher programming costs contributed to overall losses for Peacock of $704 million in the first quarter, compared to a loss of $456 million in the prior-year period.
The company saw Peacock's US paid subscribers increase more than 60% compared to the year-ago period to 22 million while revenue was also up 45% to $685 million.
"We're encouraged by our results," Michael Cavanagh, Comcast president and interim NBCUniversal CEO, said on the April 27 earnings call. "The results we are seeing give us confidence that we are on the right path for Peacock to break even and grow from there."
The executive previously said 2023 will be the year of peak losses for Peacock, estimating losses will amount to roughly $3 billion.
Cavanagh replaced former NBCUniversal chief Jeff Shell following his ousting in April over an "inappropriate" relationship with a female employee. At the time, Cavanagh maintained there would be no change in strategy as a result of Shell's ousting.
Comcast must also grapple with a double strike in Hollywood as actors join writers on the picket lines.
The strikes have already caused disruptions to broadcast networks, with CBS revealing that it plans to air "Yellowstone" reruns to help fill in the fall TV schedule, which will heavily rely on unscripted reality TV and game shows.
In another sign of networks scrambling to fill airwaves, ABC announced "Ms. Marvel", which previously aired exclusively on Disney+, would make its broadcast debut in August. ABC is owned by Disney.
According to a new report by Moody's released on Monday, Comcast is among the best-positioned companies to weather the strikes, along with Netflix (NFLX), Fox (FOXA), Sony Group (SONY), Amazon (AMZN), and Apple (AAPL).
"Major studios, network owners and streamers that are well-diversified by business, content genre (news and sports) or by geographic production and library, and have relatively strong balance sheets are least at risk," the report said.
Comcast will report second quarter results on July 27.