Amazon Makes Play In Gaming -- WSJ
February 28 2017 - 03:02AM
Dow Jones News
By Sarah E. Needleman
Amazon.com Inc.'s live-streaming business, Twitch, is entering
the fast-growing market for digitally delivered computer
videogames, a move that will give its most popular broadcasters the
opportunity to earn a percentage of sales.
A "buy" button will appear this spring on website broadcasts of
computer games from 20 companies, Twitch said Monday. Viewers will
be able to download the games -- as well as add-ons such as
expansion packs and virtual goods -- directly from the site.
Twitch ranks No. 8 among the top 500 most visited websites in
the U.S. by average time spent per visitor, according to comScore
Inc. Amazon bought the site in August 2014 for $970 million. The
e-commerce giant has since delved deeper into the $100 billion game
industry, releasing its own content as well as game-creation
software called Lumberyard that other developers can use free.
Gamers are increasingly choosing downloads over discs. Sales of
digitally delivered PC games, excluding add-ons, reached $5.4
billion last year, up 11% from 2015 and 67% from 2012, according to
SuperData Research Inc.
Under Twitch's new commerce program, game companies will receive
70% of sales, similar to what Apple Inc. and Alphabet Inc. share
with app developers. Twitch, however, will fork over 5% to
streamers, keeping 25% for itself, the company said.
More than two dozen games will automatically get the buy button
at launch, including Ubisoft Entertainment SA's "Tom Clancy's The
Division" and Telltale Games' Batman series, with more expected
later, Twitch said. It declined to specify when the buy button
would appear.
More than two million people stream gameplay and other content
on Twitch. The buy button, though, will appear only on Twitch's
website on launch games broadcast by the roughly 17,000 people
included in its partner program, which shares revenue from ads and
offers other benefits. Streamers, who must identify games they are
broadcasting, won't be able to remove the button.
"We want to grow Twitch as a social video network," said Matt
McCloskey, vice president of commerce at Twitch. "Providing
commerce opportunities for businesses, whether as streamers or
developers, drives growth."
Twitch's biggest rival, Alphabet Inc.'s YouTube, doesn't sell
games. Still, Twitch faces stiff competition in the game-download
market from Valve Corp.'s Steam. Publishers such as Activision
Blizzard Inc. and Electronic Arts Inc. also sell game downloads
online, while retail stores such as GameStop Corp. and Wal-Mart
Stores Inc. sell cards with codes for downloading games.
Consumers can already buy packaged games from Amazon's
marketplace of third-party sellers. Twitch streamers that are part
of Amazon's associates program can include links with their
broadcasts to the marketplace and earn a commission on sales.
Twitch streamers that are sponsored by game publishers and
advertisers are marked as such.
Write to Sarah E. Needleman at sarah.needleman@wsj.com
(END) Dow Jones Newswires
February 28, 2017 02:47 ET (07:47 GMT)
Copyright (c) 2017 Dow Jones & Company, Inc.
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