Comcast Acquires Xumo, the Ad-Supported Free Streaming Service

Xumo offers 10,000 free movies and shows, as well as 190 channels dedicated to specific topics

Comcast has acquired Xumo, the ad-supported free streaming service, on Tuesday, for an undisclosed price.

The Irvine-based company offers 10,000 free movies and shows, as well 190 channels, including Fox Sports, ABC News, and channels dedicated to series like “Family Feud” and “Forensic Files.”

To get that content to the masses, Xumo has an app, but it’s best known for its partnerships with smart TV makers like LG, where customers will plug in their TVs and see Xumo’s list of channels automatically installed. After signing new deals with Sony and Panasonic in January, Xumo CEO Colin Petrie-Norris told TheWrap earlier this month “over 90% of all smart TVs now carry Xumo’s service in some way, shape or form.”

The deal comes as Comcast prepares to launch NBCUniversal’s Peacock streaming service in the next few months. Xumo’s integration with several leading TV makers could help Comcast get its new service in front of more viewers, as it looks to attract an audience in an increasingly saturated streaming space.

“The talented team at XUMO has created a successful, growing, and best-in-class set of streaming capabilities,” Comcast said in its announcement. “We are excited for this team to join Comcast and look forward to supporting them as they continue to innovate and develop their offerings.”

The acquisition also comes at a time when the AVOD market is growing exponentially. Ad-revenue hit $3.8 billion last year, according to Magna Global estimates, marking a 39% increase from 2018, and in 2020, the industry is expected to increase another 31% to hit $5 billion in sales. Major media companies are turning towards AVOD as a way to potentially offset the decline in the traditional pay TV market. ViacomCBS bought Pluto TV, another AVOD staple, for $340 million last year, and Tubi is reportedly being looked at by Fox in a deal worth around $500 million.

Petrie-Norris, earlier this month, explained why the AVOD market is well-positioned, even as more SVOD services hit the market.

“There is an infusion of new [paid] streaming services, and many customers are asking if paying for 4 services — Disney+, Amazon, Netflix, Quibi — is for them. There’s this question of, “what is the right number of services?” And the gateway to adding more paid services is getting higher,” Petrie-Norris said. “Adding the first 1,2 or 3 is fine, but on the 4th, consumers — I believe — are asking questions.”