Netflix executes its plan

After its announcement in the shareholder letter in the Q2 of 2021, Netflix offers its games in Spain, Italy and Poland. In fact, several media reported that these games will be exclusively available for paid Netflix members.

At first, the US tech giant selected only three countries in the EU for testing the online gaming market. In fact, we can find some hints in the letter. “We view gaming as another content category for us, similar to our expansion into original films, animation, and unscripted TV. …Since we are nearly a decade into our push into original programming, we think the time is right to learn more about how our members value games.”

Gaming industry grows faster

The gaming industry grows bigger and faster. In fact, we see how the eSports market is growing bigger and faster in the other article relating to Netflix.

For example, the market will be 670mn EUR in terms of revenue, even in Europe alone by 2023. Furthermore, eSports audience grew 12% in 2019. The industry created a community of 443 million global viewers across different channels, according to a Deloitte report.

Can gaming be attractive?

Why does Netflix offer games to its paid members? Of course, one of the reasons is the tight competition in the online streaming services. For example, in the same article, streaming accounts for 27% of total US TV time. This number is divided into several companies: Netflix (7%), YouTube (6%), Hulu (3%), Amazon Prime Video (2%) and Disney + (2%).

More surprisingly, even though Disney + is relatively new and actually launched in November 2019, it has already 116 million users in September, 2021. In another example, Amazon Prime Video offers more original contents and its users can enjoy other features including ecommerce.

Therefore, it seems difficult for Netflix to acquire more users just by its high quality original contents. For example, YouTubers can add their “original” contents in the platform. Even though their contents are lower quality than Netflix’s, the value of “original” can incentivize users to watch them.

Talents can overcome challenges

The important question here is how to win the competition. This is because Netflix is a totally new player in the online gaming market. However, the US company is very famous for its culture, talents and innovation. Therefore, we think talents can overcome challenges.

It is true that online gaming is a service that everyone can enjoy, but who produce it? Of course, we, human being, create online products and services. Thus, we can easily imagine that talents are resource to produce attractive contents. In addition, Netflix has known culture and system to maximize its employees’ potential. That is why it can offer high quality contents and tons of people in the world like them.

In addition, if potential users are interested in Netflix’s games, they will be able to enjoy its streaming service. In other words, they can be competitive advantage in the online gaming market. This is because the companies that offer only online gaming cannot do the same thing.