Olympics Throw Lifeline to Streaming Stragglers

Cheyne Gateley/VIP+

Leave it to the Tokyo Olympics to help level the playing field in the streaming wars.

With the Summer Games underway, two of the also-rans — Comcast’s Peacock and Discovery’s Discovery+ — will find themselves with a programming draw more potent than anything frontrunners in the space have, like Netflix or Disney+.

Yes, the ratings from the first few days in Tokyo indicate the Olympics aren’t as powerful an audience draw as they used to be, but that really misses the point. Even in decline on linear channels, the Games are about as good a promotional platform as you can get.

And while the competitive set among streamers is too lopsided at this point for any one player to make the kind of jump that lands them on the medal stand, the Olympics should at least start to close the gap on subscriber counts.

For Peacock in the U.S., rights to the Tokyo Games will be just the kind of salve to heal the wound that opened for Comcast when COVID forced the postponement of the Olympics last year, robbing the NBCUniversal-run streaming service of just the kind of main attraction that would have put it on the map.

Instead, Peacock has looked like a laggard in its freshman year, doubly cursed by the pandemic because a production slowdown slowed the supply of original programming that also could have boosted the service’s fortunes.

But the Olympics could be just the boost Peacock needs to get its groove back; Wedbush Securities even projected the streaming service could see its user base grow as much as 30% due to the Tokyo Games.

Putting key competition live on Peacock is smart, as is using the singular draw of U.S. men’s basketball coverage to upsell into Peacock Premium. In addition to the Games, there’s a wealth of associated original content, including a nightly highlights show featuring Snoop Dogg and Kevin Hart, among other Olympic-themed stunts exclusive to Peacock.

The timing of the Olympics is also ideal for the halo effect it could have on the rest of the Peacock, just as its delayed original programming efforts are starting to hit their stride, with 60 original series expected to debut on Peacock in the latter half of 2021. The streaming service is also just now starting to get some of series efforts noticed, including “Girls5Eva” and “Dr. Death.”

What will really help Peacock is that its growing arsenal of sports rights will get a lift from Olympics-driven subscribers who will want to stick around for athletics such as motorcross, lacrosse and its $200 million WWE package.

With an estimated 14 million active users (a subset of 42 million so-called “sign-ups”), Peacock is in desperate need of just the kind of subscriber stimulus the Olympics can provide as part of a long-term deal that will keep the Games on NBCU properties through 2032.

With rights to show the Olympics in 50 markets across Europe, Discovery+ is also nicely positioned to see its subscriber base grow this summer, which will also be of interest to WarnerMedia considering the pending merger that will bring Discovery+ and HBO Max together at some point likely next year.

Discovery+ is the official streaming home of the Olympics on the continent, the result of a 2015 deal that already bore fruit in Pyongchang and will carry over to upcoming Games in Beijing (winter 2022) and Paris (2024).

With 15 million subscribers as of last count in April, Discovery+ is in the same boat as Peacock, in dire need of a needle-mover like the Olympics that, with the right marketing behind it, will work wonders for boosting the brand in European markets just starting to get to know the new streaming service.

Like Peacock, Discovery+ will benefit from the demographic compatibility that the Olympics can drive to the streaming service's unscripted content. Different as they might seem, both attract a female-skewing older audience. It's one thing to just bring in a big audience with a programming stunt like the Olympics. If the influx of viewers doesn't get to sample thematically similar content, they could see a subscriber uptick disappear rather quickly.

For both Discovery and NBCU, the Olympics will be an interesting litmus test to see if sports can be as effective an audience driver as games tend to be on broadcast TV. Paramount+ and ESPN+ in particular have been loading up on rights packages of all kinds that can make all the difference in terms of getting these brands the market traction they're seeking.

Even in the best-case scenario, neither NBCU nor Discovery is going to see the kind of subscriber lift coming out of the Olympics that will meaningfully change the competitive balance of the streaming space in the short term. But every little bit helps in the longer term, which is something easy to forget in a category still in its early days.