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Comcast acquires Irvine-based Xumo, as demand for free streaming services grows

Los Angeles Times logo Los Angeles Times 2/26/2020 By Wendy Lee, Los Angeles Times

Comcast Corp. on Tuesday said it bought Irvine-based ad-supported streaming service Xumo for an undisclosed price.

The move indicates a growing interest by large media companies in buying ad-supported streaming services, as customers look for free alternatives to watch TV shows and movies on demand in a market crowded with paid subscription platforms.

Analysts say Xumo will help support Comcast-owned NBCUniversal's streaming service Peacock when it launches in April by giving it a wider audience, more channels and technology. Peacock will offer a free, ad-supported tier for customers.

"Free is a very compelling offer," said Eunice Shin, a partner at consultancy Prophet.

As more marketers move TV dollars to digital platforms, companies see the potential to grab their share of the advertising revenue, Shin said. "For these larger companies looking to acquire, it's a game of numbers," she said.

Founded in 2011 by Viant Technology (then known as Interactive Media Holdings), Xumo provides live and on-demand access to more than 190 different channels and has partnerships with smart TV brands such as Samsung. The company said it is available in 20 million U.S. households. Its owners include media company Meredith Corp.

Comcast, the Philadelphia-based cable giant, said in a statement Tuesday that Xumo will continue to operate as an independent business inside Comcast Cable.

"We are excited for this team to join Comcast and look forward to supporting them as they continue to innovate and develop their offerings," Comcast said in a statement.

Xumo is the latest ad-supported network to be acquired. Last year, Viacom purchased PlutoTV, which offers live and on-demand channels to be streamed, for $340 million.

Other streaming companies, including San Francisco-based Tubi, which offers its own line of licensed movies and TV shows on demand and Walmart's Vudu is also up for sale. Comcast is in discussions to buy Vudu, while Fox is looking at Tubi, according to the Wall Street Journal.

Jon Metzler, a lecturer at UC Berkeley's Haas School of Business, said he expects to see even more ad-supported streaming companies to get snapped up.

"This feels like the beginning, not the end of consolidation," Metzler said.

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