Flex costs $5 a month
Last month, Comcast (CMCSA) launched a new video streaming platform, Xfinity Flex, for $5 per month. The Flex package includes a media streaming device and over 10,000 movies and shows. People can use Flex to access their digital video subscriptions from providers such as Netflix (NFLX), Amazon (AMZN), and Hulu. Amazon doesn’t disclose its video customer base, but Consumer Intelligence Research Partners estimates that there were over 100 million US Prime subscribers (who get video service as a perk) in the United States at the end of last year. Meanwhile, Netflix and Hulu had 58.5 million and 25 million US subscribers, respectively.
Over $400 million in new revenue
Flex is set to be sold exclusively to Comcast’s Internet customers. The company had 27.2 million Internet customers in the fourth quarter—if all of them were to pick up the Flex package, the company could generate ~$135 million in extra revenue per month, working out to ~$400 million per quarter.
Media giants responding to cord-cutting
If Flex proves to be a success, it could help Comcast in the pay-TV market. Comcast shed 29,000 pay-TV customers in the fourth quarter due to households canceling traditional pay-TV subscriptions in favor of video services delivered over the Internet. In response to cord-cutting, Walt Disney (DIS) and AT&T (T) are planning to launch video streaming services this year.