Netflix to dive into gaming with ad-free mobile video games at no extra cost

Highlights:

• Netflix is considering entering the video game market.
• The company plans to offer a bundle of games similar to Apple’s online subscription offering.
• The company is looking to hire gaming industry executives.

After dominating the streaming market for a long time despite strong competition from other rivals, Now company plans to enter the video game industry. Netflix is one of the largest streaming sites for movie and television series. With such huge popularity among the industry, it can easily be inferred that Netflix segments its users based on psychographics and not on demographics.

The gaming content is expected to come from both Netflix, and independent studios. The company has reportedly hired Mike Verdu, a former Electronic Arts, and Facebook executive to lead the effort. Verdu will lead developers to bring games to Oculus virtual-reality headsets.  The streaming video pioneer said it was in the early stages of expanding its video game offerings, which would be available to subscribers at no extra charge. The company will initially focus primarily on mobile games.

“We view gaming as another new content category for us, similar to our expansion into original films, animation, and unscripted TV,” the company said in its quarterly letter to shareholders.

Netflix New Gaming Strategy To Attract new subscribers

The total gaming market now exceeds $300 billion, according to a study by consulting firm Accenture, Netflix’s move would open a new and highly lucrative stream of revenue for the streaming giant. Netflix is no stranger to video games it has aired shows based on video game properties such as Castlevania, and Dragon’s Dogma. It has also created games based on shows Stranger Things and La casa de Papel (Money Heist).

The subscription-based video game service may be similar to Apple Arcade, which gives subscribers unlimited access to its selection of games. It has not been deciding whether Netflix will develop games itself or through an outside publisher. However, the company confirmed that games will not contain advertising.

Netflix gained its initial competitive advantage, not through a new business model, but through a combination of known business models.

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Megha Gupta

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