What’s Twitch? Gamers Know, and Amazon Is Spending $1 Billion on It
The video in video games is suddenly a billion-dollar business.
Video
games have long been something people played. But in the last few
years, thanks in part to fast Internet access and multiplayer games, the
games have become something that people sit back and watch, too. On
Monday, that new habit enticed the web giant Amazon to reach a $1.1
billion deal to buy Twitch, the most popular website for watching people play games.
The
deal for Twitch is the latest sign of the way forms of behavior once
seemingly on the fringe can, in the hands of tech entrepreneurs, turn
into huge online communities in no time. Twitch did not exist a little
over three years ago, and it now has 55 million unique viewers a month
globally, helping turn games into a spectator event as much as a
participatory activity.
Those
millions of eyeballs are valuable to web companies, and Amazon,
although usually known for its retailing, is no exception. To win in its
bid for Twitch, Amazon had to outmaneuver a who’s who of the tech
world, including Google — strongly suggesting that these companies think
the era of video-game viewing is just starting. It also underscored
Amazon’s growing appetite for controlling and delivering content to
digital devices, especially the tablets and smartphones made by Amazon.
“Broadcasting
and watching gameplay is a global phenomenon,” Jeff Bezos, the chief
executive of Amazon, said in a statement, “and Twitch has built a
platform that brings together tens of millions of people who watch
billions of minutes of games each month.”
The
site has attracted enough viewers to put it among 15 most-trafficked
websites around the world, according to data compiled by Sandvine, an
Internet networking company. Twitch viewers flock to the site to improve
their gaming skills by watching people who have mastered a game or just
to get a closer look at games before buying them. Some of the biggest
followings on Twitch are of people who are simply amusing, rather than
the best players.
Gamers
can transmit games over Twitch by using PCs along with consoles like
the PlayStation 4 and Xbox One. Twitch says that people watch more than
16 billion minutes of its videos each month. More than 1.1 million
unique broadcasters use Twitch to stream video.
The
company shares advertising revenue with people who broadcast over its
service. While the audiences for many broadcasters are so small they
make little money, some broadcasters are said to earn over six figures a
year.
The
service has dovetailed with the rise of e-sports, as professional
gaming is often called. Twitch broadcasts the action from live
tournaments for big games like League of Legends and Dota 2.
Professional gamers also use Twitch to let spectators watch their
practices, inviting them to ask questions about playing techniques.
“Before
Twitch, gaming was something you did in the basement in the glow of
your monitor,” said David Cowan, a venture capitalist with Bessemer
Venture Partners, a big investor in Twitch. “Now it’s something you can
do in groups with hundreds and thousands of people.”
It
is not clear exactly how Amazon intends to fit Twitch into its eclectic
and ever-expanding portfolio of businesses. It could help accelerate
the company’s advertising ambitions by giving it a huge video network to
pump commercials through. This year, Amazon ad revenue is expected to
jump 40 percent, to over $1 billion, according to estimates from
eMarketer, a technology research firm.
Source : http://www.nytimes.com/2014/08/26/technology/amazon-nears-a-deal-for-twitch.html
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