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Netflix taps gaming as its next growth play in the transmedia gold rush

Snacks / Tuesday, July 18, 2023

Netflix cheat codes… After logging its slowest revenue growth on record last year, Netflix has focused on money-milking strategies like its password-mooching crackdown and the rollout of its ad tier. But on the content side the streamer is betting on an industry that even the biggest of big techies have struggled with: gaming.

  • Testing: Since Netflix introduced mobile games in 2021, its Games division has expanded to a library of 67 titles and 450 employees.

  • Playing: Also in ’21, Netflix bought the studio behind narrative adventure game “Oxenfree.” Since then it’s purchased three more gaming studios and created two from scratch.

  • AAA: It plans to launch 40 games this year. Last week it released “Oxenfree II” on its mobile app, PlayStation, Nintendo, and Steam. Netflix is also working on a high-budget title from former “Halo” and “Overwatch” creators.

Big hands, little controllers… Despite trying their best to carve out a slice of the $200B/year gaming pie, new-entrant tech giants have had a hard time leveling up. Google shuttered its gaming service, Stadia, in January after three years in operation. Amazon Game Studios’ $500M/year price tag has resulted in several failures and exec departures. Unlike those two, Netflix plans on moving slow and steady till it finds its footing. Its games have been downloaded only 44M times (or about once per every 100 subscribers).

The transmedia train runs both ways… As gaming IP (like “The Last of Us” and “Super Mario”) finds onscreen success, Netflix is hoping that the trend can work the other way around: fans downloading their favorite shows’ video-game counterparts. The streamer released “Stranger Things” tie-in games, and “Queen’s Gambit Chess” is expected this month.

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