If you produce and own video-based content, launching a streaming service has become something you seemingly need to do. The problem is that the market has become saturated and getting consumers to care has become exceedingly difficult.

Netflix (NASDAQ:NFLX) has a first-to-market advantage, and its 166 million subscribers set a standard for what success in streaming can look like. Walt Disney (NYSE:DIS) has not released subscriber numbers for its Disney+ service, aside from noting that it had quickly passed 10 million paying customers, but external signs (like downloads of its app) suggest that the service has been a major success.

Disney has used its extensive library and The Mandalorian, the first live-action show set in the Star Wars universe, to build its audience. Even with its impressive lineup of intellectual property (IP), Disney knew that it was entering a tough market, so it priced its service at $6.99 a month -- slightly more than half of the $12.99 Netflix charges for its standard plan.

Now, Comcast (NASDAQ:CMCSA) wants to take on these two streaming giants. It's launching its Peacock streaming service on a limited basis in April with a full rollout scheduled for July, to coincide with the Olympics. Comcast seems to know that it faces an uphill battle for customers because it's offering Peacock for less than what its rivals charge -- and many consumers will get an ad-supported version of the service for free.

A person watches video on a tablet.

NBC's streaming service likely will not disrupt the current market leaders. Image source: Getty Images.

What is Comcast doing?

When it comes to launching a new streaming service, the logic appears to be that red is the new black. You have to spend heavily on original content, keep your price low, and try to find a way to entice sampling.

Build an audience, and then you can slowly raise prices. That seems to be part of Disney's strategy, and Comcast is taking an even more extreme tack with Peacock.

NBC's new service will have a number of tiers, and two of them will be free:

  • Peacock Free: An ad-supported tier with access to archival programming, next-day access to current seasons of new NBC shows, some Olympics-related content, and select episodes of Peacock original programming.
  • Peacock Premium: This is the core offering. It's all the Peacock service has to offer, including original shows, early access to NBC's late-night talk shows, and sports including extensive Olympic content. This tier will have ads and it will be free to 24 million Comcast and Cox subscribers. (Everyone else will pay $4.99 a month.)

Basically, Comcast is giving Peacock away to its existing cable customers. It may also make deals with rivals beyond Cox to extend the free offer to even more people.

This is not dissimilar to what Disney has done with Verizon and what Netflix has done with T-Mobile. Basically, you build interest in your product by giving it to consumers for free. That works, in theory, if consumers become accustomed to using the service and would ultimately be willing to pay for it.

This is a long road

Comcast is integrating its streaming service into its existing cable and internet properties. That allows it to keep the service "free" for some users while getting its money in a backdoor way.

Peacock has a decent lineup of archival IP and the Olympics will be a draw for some people. The company's original slate will face the same challenge every new streaming service has -- audience overload.

None of this suggests that Peacock will fail. Peacock is a long-range play but it's not a real threat to Netflix or Disney. Few, if any, Comcast customers will drop their existing paid subscriptions because they have access to a new one that has lots of old content, some sports, and originals mostly not based on big-name properties.

This is a case where a patient Comcast can win without that meaning that the existing category leaders lose. That's not true for second-tier players, which will face an even tougher road, but Disney and Netflix investors can relax.

This article represents the opinion of the writer, who may disagree with the “official” recommendation position of a Motley Fool premium advisory service. We’re motley! Questioning an investing thesis -- even one of our own -- helps us all think critically about investing and make decisions that help us become smarter, happier, and richer.