Amazon’s Acquisition Of Twitch Proves E-Sports Is Big Business

September 2, 2014 3:43 PM

Last week Twitch.tv was sold to internet giant Amazon for the princely sum of $970 million. This was most surprising, since many news articles had reported the acquisition of Twitch by rival giant, Google, back in May. This proposed deal with Google stalled due to supposed anti-trust issues, and Amazon swooped in for the popular video game streaming site. Twitch will be part of Amazon’s on-going plans to expand its digital arm into the lucrative video games industry.

A Twitch broadcast, streaming gameplay from Xbox One

A Twitch broadcast, streaming gameplay from Xbox One

For those that don’t know, Twitch is live streaming video platform primarily focused on video games. This includes playthroughs of video games by users, and broadcasts of e-sports competitions. In less than 3 years, Twitch has cemented its position as the go-to source for video game streaming. It’s value comes from it’s ever-growing community. “In July, more than 55 million unique visitors viewed more than 15 billion minutes of content on Twitch produced by more than 1 million broadcasters”. Engagement of the user base is extraordinary, on average each user spends 106 minutes a day on the site, and it gathers more internet traffic than Facebook.

E-sports has had something of a resurgence in the past few years. Whilst popular in Asia, e-sports has had a more troublesome road in the US and Europe. Until Twitch, there was no real way for video game fanatics to watch professional gaming. In the US championship MLG matches were broadcast on ESPN, but only on their smaller channels. Twitch has been able to succeed because it’s built a platform online, where gamers naturally exist. It made gaming it’s sole focus, so that e-sports as a whole is portrayed as a legitimate sport. E-sports popularity has risen dramatically, the largest e-sports event to date took place in July 2014 in Seattle. The International 2014 Dota 2 Championships, divided $10.9 million among it’s competitors (a bigger prize pool than the Super Bowl), with the winner, a Chinese team called NewBee, being awarded over $5 million and a reported 20 million unique viewers watching the live streams.

Twitch was also the centre for one of the more absurd phenomenons of the internet, Twitch Plays Pokemon, which went viral as a social experiment earlier this year. It’s success on Twitch has spawned other bizarre experiments, which play out in a similar vein, such as Fish Plays Pokemon.

"All hail Lord Helix" Part of the bizarre lore which surrounds Twitch Plays Pokemon

“All hail Lord Helix”
Part of the bizarre lore which surrounds Twitch Plays Pokemon

To Google, Twitch would have most likely been another way to generate ad-revenue. Perhaps, with Amazon at the helm, more interesting services can be integrated. Imagine watching a stream of the latest Call of Duty and with one click ordering the game for same day delivery, thanks to Amazon’s speedy Prime service. Twitch’s passionate user base could also aid Amazon’s other video game related ventures. Earlier this year Amazon acquired Double Helix Games, the developer behind Killer Instinct on Xbox One. Amazon Game Studio is still waiting for it’s shining moment, having released only a handful of games on mobile platforms, with middling levels of success since it’s inception in 2012.

The video games industry is massive and it should be no real shock that the likes of Amazon and Google would be vying to take charge of a young and promising company such as Twitch. For Twitch and it’s users the real concern will be to what extent the current experience will be adapted. One thing is for sure, e-sports is on the rise.

 

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