Netflix Is Moving Into Gaming
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Netflix released a letter to shareholders confirming their next move is to video games. The monolith streamer revealed that although it is in the early stages of its expansion into video games it is hoping to begin by primarily focusing on those for mobile devices rather than consoles. According to the letter: “We view gaming as another new content category for us, similar to our expansion into original films, animation and unscripted TV. We’re excited as ever about our movies and TV series offering, and we expect a long runway of increasing investment and growth across all of our existing content categories, but since we are nearly a decade into our push into original programming, we think the time is right to learn more about how our members value games.”
Greg Peters, COO and chief product officer of Netflix disclosed that they intend to bulk up the streaming giant's IP, develop their own content and license games to increase their library. He continued: “It’s a multiyear effort. We’re going to start relatively small. We’ll learn, we’ll grow. Our subscription model yields some opportunities to focus on a set of game experiences that are currently underserved by the sort of dominant monetization models in games. We don’t have to think about ads, we don’t have to think about in-game purchases or other monetization, we don’t have to think about per-title purchases. Really, we can do what we’ve been doing on the movie and series side, which is just hyper, laser focused on delivering the most entertaining game experiences that we can.”
It is uncertain when these plans will come to fruition. However, former Facebook and Electronic Arts Executive Mike Verdu has joined the company as its new vice president of game development and N’Jeri Eaton as its first head of podcasts, who prior to this position was head of content for Apple Podcasts. It is evident by this move that Netflix aspires to be more than the go to streamer when users are at home and in the mood to binge or have a movie night. The letter goes on to say: “We compete with (and lose to) Fortnite more than HBO. There are thousands of competitors in this highly fragmented market vying to entertain consumers and low barriers to entry for those with great experiences. Our growth is based on how good our experience is, compared to all the other screen time experiences from which consumers choose. Our focus is not on Disney+, Amazon or others, but on how we can improve our experience for our members.” Netflix’s approach to gaining the upper hand on the competition seems to be a viable strategy. With video games under their belt, the already mammoth streaming service will continue to rise as a global powerhouse in more than one category.
With its plans to push mobile-first offerings, Netflix seems to be aiming to secure the attention of their users wherever they may be at whatever time. Reed Hastings, co-CEO of the company called the endeavor “the challenge of winning time away from other activities and competitors. Instead of doing Xbox or Fortnite or YouTube or HBO or a long list, we want to win and provide a better experience: no advertising, on-demand, incredible content.” Netflix reported $7.3 billion in revenue during the second quarter of 2021 — an increase from Q1’s $7.16 billion. The streamer said it has 209 million subscribers, thanks to an addition of 1.5 million subscribers in Q2.
