Have subscription fatigue? The head of NBC's new streaming service thinks he has the answer

New York(CNN Business) After a Max, a Plus and another Plus, the streaming world is now being introduced to a Peacock.

Peacock has finally arrived — and while the new NBCUniversal service may be showing up late to the party, it hopes to catch attention with a colorful library and an entry price of $0.

Matt Strauss, the chairman of Peacock and NBCUniversal Digital Enterprises, spoke with CNN Business about the service's launch on Wednesday, the free-tier approach and why he likes the name Peacock.

This interview has been edited and condensed.

I'm just going to ask right off the bat: Are you a fan of the name Peacock? You can be honest with me.

You know, I am. I see it as providing two paths. One, it pays homage to NBC and the heritage, as a lot of the content does tap into NBCUniversal. But at the same time, it's not NBC+. So there was a conscious decision that we're building a new brand, charting the path for the future.

That gives us permission to also reinvent what we want Peacock to stand for, as a consumer value proposition and as a brand. I like the fact that it plays in both of those different dimensions.

Off the top of my head, there's Netflix, Disney+, Amazon Prime Video, Hulu, CBS All Access, HBO Max and Apple TV+, and those are just the big services. Tell me why I should sign up for Peacock as well.

Because Peacock's going to give you access to premium entertainment and live news and sports, content that's timely, timeless — and it's free.

Speaking of free, Peacock is a bit different than some other services in that it has a free version supported by advertising. Why was that important?

There's a couple of reasons we think this is really going to resonate. The first is we're seeing signs of subscription fatigue, [with] so many different options people are paying for. The research we've done indicates people are looking for alternatives, for lower-cost options. There's been this expectation that people don't want to watch ads — I think that's not true. There's a very large group of consumers who would embrace an alternative model.

This to me is like a white space in the market, [in] that most streaming services are focused on a very targeted segment, which is ad-free premium content.

What has been the biggest challenge in bringing Peacock to market during a global pandemic? How has it changed your launch strategy?

We had always planned to do a two-phase launch: kind of a soft launch on Comcast (CMCSA) as a sandbox to learn, and then nationally three months later in July. We've hit all of our launch dates. Clearly, you've got to be flexible. None of us could have anticipated a global pandemic where you've got upwards of 1,000 employees across the world now sheltering in place.

We've had to make changes in programming, given that some of our original productions got delayed [as] almost everybody in video has experienced. We decided to really lean more heavily into content we knew was nostalgic and familiar — like "Two and a Half Men" or "King of Queens" or "Everyone Loves Raymond," shows that are almost like comfort food. That's been a very effective strategy.

The Olympics were also postponed.

The Olympics were meant to be an opportunity for us to tap into that moment to launch Peacock, [so] we had to shift our marketing strategy. If there's a silver lining, we've been able to put together what I think is an even better, more aggressive marketing campaign for July.

And what we lose in 2020, we more than gain in 2021, because we're going to have almost two Olympics within an 18-month period. Plus, we're going to have even more original content next year along with other great opportunities like "The Office" shifting over exclusively to Peacock in January.

I think we've been able to navigate [the changes] to the best of our ability — and do it in a way that we haven't lost a beat. If anything, we're actually further ahead than where we thought we'd be at this point.

How do you think coronavirus is going to change the streaming world, and Hollywood?

Certainly it's had an impact on how we produce original programming. One of the silver linings [is] that because of sheltering in place, overall we've seen an increase in video consumption across the board in this country.

The other thing is that six or seven months ago when we revealed our strategy, we identified this opportunity of subscription fatigue, which is why we leaned toward free ad-supported. Now that we are arguably heading towards an unstable economy, possibly a recession, I think free is more relevant now than it's ever been.

In a very small way, I think everyone's trying to figure out how to somehow do something positive for the country, given everything that's been happening. People at Peacock personally feel very [invested] in bringing this service to market — not only because it's quality content but also because we're making that available for free. [It] is a really good thing for consumers to have that choice [right now], especially if affordability is an issue.