As one of the biggest online retailers around, shopping portal Amazon provides us with a range of goods from gift-wrapped plushies to clothing to high ticket items like designer watches and games consoles all delivered to our doors in days. Its next day delivery system Amazon Prime has bagged them thousands of paid subscribers looking for speedy shipping, they now have Amazon Instant Video (their answer to Netflix) and just recently they launched the Amazon Fire Phone which is their first foray into the smartphone market. All over the place Amazon is raking it in so like any cash-flushed company with millions to burn they’re taking their business to the next level – with the logical step forward being a purchase of the online video streaming site, Twitch.
But is that such a good idea for Amazon? Undoubtedly yes. Amazon, with its power and social clout as the go to department store, has effectively gobbled up the profit margins of high street retailers through aggressive pricing and ease of use. Particularly stores that sell video games as now even if you want a game on the day of its release, choosing the right shipping option on Amazon’s checkout will let you and rather than trekking to some store having to face rain, snow or sunlight, Amazon will get it to your door with the morning post. Order, ship and play the game you just bought all without leaving the comfort of your footie pyjamas. Twitch is just an extension of that new-fangled gaming experience as it’s long been popular with gamers in particular when they want to show off their games, some streamers with audiences so large that they make a living from Twitch’s subscribe option (viewers can subscribe and get added benefits). Twitch CEO Emmet Shear says that Twitch won’t change but it would surprise few people if Amazon exercised Twitch’s power to help shift more copies of games.
This is beneficial in the short term for Twitch though as the team behind the service were looking for buyers. Google put their name forward some time ago looking to offer $1 billion to buy the company and prop up YouTube’s existing platform as it too is quite popular with videos for gamers. Twitch meanwhile would get the benefit of new servers and all that jazz, helping them cope with the growing influx of viewers and streams. It’s Google’s ownership of YouTube that proved to be a problem though as Google worried about antitrust issues that may arise if the Federal Trade Commission deemed Twitch to be a competitor of YouTube and Twitch were not willing to agree on the figure they’d have to pay if they decided to back out as a result.
Nonetheless, things appear to have turned out quite well for all involved. Twitch wets the money it needed, Amazon gets another feather in its cap and gamers get the service that they love but better supported. The deal won’t be finalised until the end of the year though, so we’ll wait until then to see how it all pans out.
Are you happy Amazon bought Twitch or are you scared of the changes they’ll make?