To begin with, it was a DVD mailing service but now it’s a major player in both production and streaming. The future of video games appears to be Netflix’s next big bet. As part of its push into the booming mobile gaming industry, streaming giant Netflix announced on Monday that it would be establishing its first in-house video game studio in Helsinki, Finland.
Amid a general market downturn, Netflix (NFLX) has had a rough year, reporting subscriber losses for the first time in over a decade and seeing its stock plunge more than 60% in 2022. Tom Forte, the senior research analyst at D.A. Davidson, said the company’s move into the gaming industry is “an example of Netflix (NFLX) playing offense, not just defense,” despite the company’s recent cost-cutting efforts.
Forte praised Netflix, saying, “To their credit, they are a long-term thinker.” “If you consider their strategic shift from DVDs to streaming, you can see that they are long-term thinkers and doers.”
When considering the amount of time people now spend playing and streaming video games, Forte remarked that Netflix was especially perceptive in “identifying early” that gaming was a competitive threat to its audience. This transition also allows Netflix to earn money off of its most successful series “Stranger Things.”
Marko Lastikka, a seasoned veteran of gaming giants Zynga and Electronic Arts, will lead Netflix’s new gaming studio, according to a blog post by Netflix VP of Game Studios Amir Rahimi.
According to Rahimi, “this is another step in our vision to build a world-class games studio that will bring a variety of delightful and deeply engaging original games — with no ads and no in-app purchases — to our hundreds of millions of members around the world.”
He continued, saying that Helsinki was chosen for the new studio because it is “home to some of the best game talents in the world.” The Next Games studio in Helsinki was acquired by Netflix earlier this year. However, according to Rahimi, the new studio will be built entirely from the ground up.
With Monday’s announcement, Netflix now has four separate game studios. After acquiring Next Games, the company already owned Night School Studio and Boss Fight Entertainment. According to Rahimi, each studio has “different strengths and focus areas” and working together, they will create a wide variety of games for Netflix subscribers.
It’s been a little over a year since Netflix launched its games service. Information from market research firm Apptopia was shared with CNN Business on Tuesday, revealing that the streaming giant now has 32 games that have been downloaded around 30 million times globally.
Games from Netflix can be streamed or downloaded to play on iOS and Android devices, as well as the iPad, iPhone and iPod Touch. Choose from titles like “Stranger Things: 1984,” a throwback adventure game or “Hextech Mayhem: A League of Legends Story,” a story-driven MOBA.
According to Apptopia’s numbers, 1.63 million people used Netflix’s games daily in the last month. Of the company’s 220 million paying subscribers, this is a negligible percentage.
When making his announcement, Rahimi emphasized that “it’s still early days.” “I’m proud to see how we’re steadily building the foundation of our games studios in our first year and look forward to sharing what we produce in the coming years,” said Rahimi.
Stay tuned for more updates at nogmagazine.com.
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