With over 204 million global subscribers, Netflix is the world’s biggest subscription-based streaming service, earning over $2.75 billion net income in 2020. Imagine just how much money the company could make if only half of its subscribers purchased Netflix-developed gaming titles. Netflix’s certainly imagining it – as reported by the company’s last earnings call, the streaming service is getting into video games.
According to an article published by IGN, Netflix is bringing a whole new meaning to the phrase “Netflix and chill” as the company tries to diversify its content by introducing proprietary video game titles. As reported by the article, Netflix has been approaching key figures and veterans of the gaming industry in efforts to recruit an executive to oversee an expansion into video games. This is a fantastic business idea, given the company’s massive subscriber count – a fraction of which would definitely purchase Netflix-owned gaming titles. So, if you already have gaming-loving subscribers, all you have to do is make games. And that’s precisely the direction Netflix’s currently looking at.
It’s still unclear whether Netflix will actually develop its own video games or hire an external developer for the job, and publish the titles under its proprietary streaming service, which would suggest the Apple Arcade business model. This would allow subscribers to pay a fixed fee to access and stream gaming titles via the streamer’s service. And while it’s improbable that the service would compete with PlayStation or Xbox, at least in the foreseeable future, Netflix has been very outspoken about entering the world of gaming – the company even hosted a panel at E3 2019.
It’s worth noting that this isn’t the first time Netflix’s playing with the idea of developing/publishing video games. The world’s largest streamer previously released a game based on its Stranger Things license and is currently purchasing other video game licenses for their Netflix Original adaptations, following the success of The Witcher. Their roster of upcoming releases based on gaming licenses includes Resident Evil: Infinite Darkness, Assassin’s Creed, Sonic Prime, and a Cyberpunk 2077-based anime show. It might even reconcile with Blizzard Entertainment and continue the now-canceled Diablo animated show the company was supposed to produce in 2018.
With everything said, this is the first time Netflix’s discussing developing and streaming video games from its own bespoke streaming service. If Netflix-owned video games become a success, we might even see an influx of other streaming adaptations based on Netflix’s proprietary material. Given how more and more competitors are entering the streaming market, Netflix will have to continue to adapt and explore new frontiers to compete and remain on top. The company certainly flirted with the video gaming market in the past but never actually committed to an ongoing relationship – something we might see change in the future.
From what we gathered so far, the company is looking to make its gaming business as big as its video streaming service and not a secondary source of revenue like many other of its competitors did. It should make things interesting for Netflix’s competition and even more fun for the consumers when other streamers join the gaming race.