The retail giant is going to purchase video game streaming platform Twitch Interactive for almost $1bn in cash in its attempt to expand its presence in gaming. The analytics confirmed that with video gaming growing into an online spectator sport, gameplay video feeds are now very lucrative. The popular gaming network had 55 million unique visitors per month, most of whom went to its website to watch other gamers play games competitions interspersed with advertising.
Amazon claimed that broadcasting and watching gameplay has become an increasingly popular global phenomenon, and Twitch has created a platform capable of attracting tens of millions of people watching billions of minutes of games monthly.
This acquisition illustrates how Amazon is trying to expand into new commercial arenas. For example, the company introduced its own smartphone, the Fire, a few weeks ago, and added same-day delivery, a set-top video streaming device to its list of services for members of Prime loyalty program. In addition, the retailer has an in-house gaming studio producing games and Fire TV set top box, specifically designed to attract gamers.
As for Twitch, the company agreed that Amazon was a good fit because the retail giant believed in its community, shared its values and long-term vision. It is also known that Google had been in talks to purchase the service, but the deal didn’t go further. Some industry observers believe that Google might have been a better fit for Twitch, because Amazon can find it a harder asset to use. Indeed, the company lacks the kind of video streaming audience that YouTube already has.
Nevertheless, the analytics said that Amazon was trying to own more of its own content rather than simply selling others’. This is what Twitch could help the company with. The service captures people’s attention for hours a week while also creating a product tie-in opportunity which Amazon is able to capitalize on in a way that Google could not.
Twitch launched three years ago to focus on live video for gamers. Now users view over 155 billion minutes of video produced by over 1 million broadcasters per month. The list of broadcasters ranges from individual gamers, pro players to video game publishers, developers and others. In the meantime, digital video advertising in the United States is expected to reach $5.96 billion in 2014, up 41.9% from the past year.
No comments:
Post a Comment