US film studio giant NBCUniversal has delayed plans to launch its streaming service Peacock in the Australian market, setting the stage for a fierce battle between the nation’s commercial networks for the last major Hollywood content deal.
The Comcast-controlled media company flew in Justin Che, NBCU’s managing director - Asia Pacific from Singapore several weeks ago to formally start the process of selling its programs, films and channels in Australia. Several industry sources, who spoke anonymously because the talks are confidential, said the company has met with local media executives that are expected to bid against one another for the content over the next few months, given most existing deals expire in December.
Gangs of London is one of several programs in NBCUniversal’s slate.Credit:Stan
NBCU’s negotiations will be fiercely competitive and expensive as they could be the last major content discussions to occur in the Australian market. Other international players such as Disney and Paramount have already taken back content from local networks and launched direct-to -consumer streaming services.
The decision to strike a content deal delays NBCU’s previous plan to launch its streaming service Peacock into the market, or tie-up with a local player such as Seven West Media, which held joint venture talks with the company. NBCU has had commercial deals in place with Stan and Foxtel for several years, but these agreements have become critical as the market fragments and international production companies take back content for their own services.
International exclusivity deals - such as the agreement struck between Netflix and Sony for popular US sitcom Seinfeld - have also affected what content is available on various services.
This masthead reported last year that NBCU was considering bringing Peacock into the market on its own or through a joint venture partnership with a player such as Seven West Media or Paramount (it has a relationship with Paramount internationally). However, media industry observers believe it could potentially make more money from selling its content to established players in the local market.
NBCUniversal’s slate includes content from Peacock, Sky Studios (which parent company Comcast bought in 2018) and traditional NBCU programs. It is the largest deal in terms of volume in this market. Sky Studios, which was behind Chernobyl, has invested a large amount of money in original programming since 2019 and has established a major production studio an effort to become the Hollywood of England. NBCU’s library also includes The Office (US), Parks & Recreation, Brooklyn 99 and Downtown Abbey.
The existing content deals - including a 2020 deal with Stan for Peacock originals - all expire later this year. For Foxtel and Stan, a deal would reduce the risk of losing market share to another streaming player. Stan, which is owned by Nine Entertainment Co (owner of this masthead), cannot afford to lose its current output deal as other major international companies, like HBO and Showtime, provide their new content to Foxtel and Paramount.
Parks & Recreation is also in NBCUniveral’s content deal.
Foxtel would need a deal with NBCU to ensure it has international content available to subscribers if it loses HBO Max shows such as Succession and Euphoria when its current contract expires in December 2023.
HBO Max is expected to merge with Discovery Plus in the next 18 months following the merger of Discovery and WarnerMedia, which was completed last week. Johannes Larcher, head of HBO Max International, said last week the streaming service had ambitions to hit 190 territories by 2026 by rapidly expanding its slate of international original programs. Such a move would put the current relationship between Foxtel and WarnerMedia at risk.
Seven needs content to be able to operate in the online streaming space and Paramount, which locally owns Network Ten, has a partnership with NBCU in Europe. The value of the contract is unclear because the output is split across multiple services. But sources familiar with the contract most recently signed between WarnerMedia and Foxtel - estimated to be about $100 million per year - expect the next deal with NBCU in Australia could be worth more.
Observers believe in NBCU is in a strong position in negotiations with local networks because it has the option of bringing Peacock to Australia, and because of a scarcity of remaining content available for local players services to buy.
Any contract, once signed, is expected to include a termination clause allowing NBCU to go direct to consumer at any point in future. NBCUniversal was unavailable for comment.
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Last major US content deal up for grabs as NBCU delays local Peacock launch - Sydney Morning Herald
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