Comcast has revealed its plans to buy Xumo TV, a content service provider known for offering free streaming service. Meredith Corp and Panasonic currently own Xumo TV. This service offers free movies, shows, and premium channels that you can stream in more than 30 streaming platforms.
Xumo TV has been in the market for a few months, which might seem like a good fit for Comcast. Xumo and Comcast made a partnership deal in the summer of last year to include the service of Xumo in Comcast’s Xfinity X1.
The Deal Has Not Been Disclosed
The terms of such a deal haven’t yet been revealed and neither Comcast nor Xumo TV have confirmed the acquisition. This actually made people wonder why a giant cable company would show interest in a free streaming service. But perhaps this is Comcast’s way of diversifying their revenue, hoping to attract more customers and make up for their massive loss of subscribers recently.
As revealed by the Leichtman Research Group, the cable company lost around 238,000 subscribers in the 3rd quarter of 2019. At the end of the quarter, the company had only 21.4 million subscribers. But on that same quarter, Comcast gained about 379,000 new subscribers for their broadband service and ended the quarter with about 28.2 million broadband subscribers.
And while Comcast is losing cable subscribers continuously, they are also gaining customers for their broadband service. That’s because cord-cutting customers would rather rely on the Internet to watch their favorite flicks. They use free streaming services such as Xumo or paid streaming services like Hulu and Netflix.
Diversifying Revenue Streams
By including Xumo to its services, Comcast will be able to further diversify its revenue streams with the advertising sales of Xumo. This could yield them a generous amount of revenue.
Last April, Fierce Video that Xumo had around 5.5 million monthly viewers. This represents a 300 percent annual growth in the first quarter of 2019. The company hopes to quadruple the amount of time that its users spend on the streaming site by the end of the year.
If Comcast purchases Xumo, they are going to combine this service with the AVOD service of NBC Universal, which will be launched in spring. This way, Comcast subscribers will now be able to watch content from Peacock without any charges. Nevertheless, cord-cutters will still have to pay for the monthly fee to use the service.
Changes on Packages and Pricing
Last December, Comcast revealed changes in its pricing. They will launch smaller packages for a cable subscription, which they call Choice. It will cost around $10-$20 monthly. This offering is part of Comcast’s plan for Vision 2020.
Aside from the pre-packaged bundles, customers will also have the option to choose their own bundles that will include local TV channels. The company also plans to offer added services like home security, cell phone services, and the Internet.
Besides the change in pricing plans, it was revealed by Cord Cutters News that Comcast also plans to limit the promotions and discounts that they offer to their existing customers. They think that this will prevent their existing customers from calling to request for a continued discount once a specific promotion is over.
For customers who prefer cheaper packages, they must first pay for the premium services that Comcast is offering before they can avail of the pricing bundle.
Conclusion
Despite owning billions in assets, Comcast is still looking at the future of the company for the long-term. It’s doing this by making changes in its packages and pricing. This way, they are looking to attract new customers to sign-up for their service while also retaining their existing subscribers.
In today’s world where there is a rapid evolution in streaming services, it’s important for Comcast to remain competitive. They can do so by acquiring new services, products, and acquiring new licensing agreements. Their strategies can also help diversify the company’s revenue.
Do you think Comcast is making the right decision buying Xumo TV, a free streaming service? Let us know in the comments section!
