Netflix's Move to Gaming

Netflix's Move to Gaming

After a rapid growth period during the Covid-19 pandemic, Netflix is now feeling the squeeze with competitors Disney+ and Amazon rapidly gaining ground on the streaming giant. As a means to try to diversify their brand Netflix are now looking to get into the difficult world of gaming. Earlier this year they hired former EA and Oculus executive, Mike Verdu, to head up their gaming division. A move the platform hopes will give them the edge over more recent streaming competitors. 

Gaming is no easy sector to enter into. Large tech companies both new (e.g. Google's Stadia) and old (e.g. Sega's Dreamcast) have tried and failed at entering the market. There are of course exceptions in the form of Microsoft and Sony, but these are few and far between. That's not to say that Netflix is coming in without any experience. In the past, they have tried their hand at interactive TV shows in the form of Carmen Sandiego and Black Mirror: Bandersnatch. But with only 14 interactive shows under their belt, Netflix will have to make some serious strides if they want to play with the likes of Nintendo. 

Another challenge facing Netflix is the move from passive to active viewing. Many people watch Netflix with the intention of binging or putting something on in the background. Getting the viewer actively involved can be a bit more of a challenge, perhaps illustrated by the mediocre reviews of its interactive titles. 

Netflix has already introduced gaming on mobile Android devices in Poland, Spain and Italy. With a slow roll out only on mobile devices, it could be the case that Netflix simply wants to enhance their existing service. Users are not being charged more to gain access to the mobile games, so it's possible that Netflix merely views gaming as a means of marketing its existing shows, particularly to younger generations (e.g. Gen Z). 

Netflix recently purchased American video game developer Night School Studio. The creator of Oxenfree and Afterparty could be a good fit for the streaming service. Rather than rely on their own in-house studio, Netflix could see more strength in acquiring existing developers to create higher quality games. The streaming platform has some extremely lucrative IP in the form of Stranger Things and, more recently, Squid Game so the potential for crossover could be very valuable to the company. It's early days yet, but we're interested to see where these new avenues take them.