Reasons why Netflix’s entry into the game business can be a “monster”

On July 14th, Netflix announced plans to enter the video game field. While the news was generally well received by the public, Hollywood studios have tried multiple times to break into the gaming industry, almost all of them unsuccessfully.

Disney closed its interactive division in 2016 after three unsuccessful forays into the space. NBCUniversal also closed its division in 2019, three years after launching its game publishing business.

The late Sumner Redstone, who built a major media empire through acquisitions of Viacom, Paramount Pictures, and CBS, also put a lot of money into games, but failed to succeed. The only successful film company in this field is Warner Bros., with hits such as “Harry Potter,” “Mortal Kombat,” and “The Lego Movie.”

Netflix believes it can rewrite such a disgraceful history, hiring former Facebook vice president and former Electronic Arts (EA) exec Mike Burdu as vice president of game development.

By entering the game business, the company aims to provide subscribers with new entertainment options and differentiate itself from the competition.

Netflix is ​​trying to diversify its revenue sources, including merchandising hits such as “Stranger Things,” amid a slowdown in membership growth in the United States.

Research firm Newzoo expects computer, console and smartphone games to record $175.8 billion in sales worldwide this year. Netflix teased its foray into interactive games in a call with investors earlier this year.

“There is no doubt that gaming is an important form of entertainment, and we are learning and growing in this space,” said Netflix Chief Product Officer Greg Peters.

Difficulty in generating synergistic effects

Netflix drew widespread attention with its interactive storytelling experiment with 2018’s Black Mirror. Earlier this year, he collaborated with Vox Media to create Headspace Unwind Your Mind, an interactive guide to meditation and relaxation.

Through efforts like this, Netflix is ​​exploring the possibilities of interactive storytelling. However, the company hasn’t said much about this nascent effort, and it’s unclear whether it will become a platform that distributes not only its own games, but also other companies’ games, as it does content such as movies and dramas. .

But one thing is for certain: the success of Netflix’s gaming business is far from certain.

Gaming industry analyst Michael Pachter said Netflix is ​​entering an already crowded market, with 40,000 mobile games produced each year, but very few that translate well to film or television. It says it is small and vice versa.

“Netflix is ​​going to release mobile games first.

“Netflix hired good coaches, but they don’t have players,” Pachter said.

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