ValueTheMarkets.com News Commentary - With so much money on offer, it’s no wonder that the streaming specialists who already dominate the film and TV entertainment market are so keen to start benefitting from the growth of gaming. This article discusses this issue with reference to Netflix (NASDAQ: NFLX), Walt Disney Co (NYSE: DIS), Apple (NASDAQ: AAPL) and QYOU Media (TSXV: QYOU) (OTCQB: QYOUF).
QYOU Media (TSXV: QYOU) (OTCQB: QYOUF) is currently focused on building a media brand that appeals to young Indians through its influencer-led TV and video-on-demand content. The company makes money from ad sales on its channels and through social media-based influencer marketing campaigns.
Having already launched three new channels in 2022 and achieved the fastest channel growth in 2021 with its flagship Hindi-language offering, the business is achieving considerable growth.
Now, the company has announced that it’s increasing its presence on Indian connected TV and digital platforms with the launch of a new channel – Q GameX.
The reasoning behind this move is clear. This year the gaming industry is expected to surpass $208bn in revenue and statistics suggest that the number of gamers around the world will exceed three billion people.
India is expected to be home to 450 million online gamers by 2023, putting it behind only China in terms of the number of users. Alongside this anticipated growth in audience is growth in the industry, with India’s gaming industry expected to reach $5bn by 2025, mainly driven by a rapidly increasing young population with higher disposable income.
The new channel, Q GameX, will stream gameplay matches and battlegrounds while taking
viewers through some interesting insights on consoles and gaming equipment, unboxing experiences, tips and tricks and much more.
The company’s ultimate aim is to engage with digitally savvy young adults and monetize their viewership by working with brands and advertisers.
QYOU’s attitude to programming is similar to its other channels. The business will leverage content from a wide array of top social media influencers and digital content creators, serving it to a highly engaged audience 24/7.
The channel, which is scheduled to launch in September 2022, will target the 18–35-year-old demographic.
The Q India COO and leader of connected TV platform efforts, Krishna Menon, commented:
“We are executing on our goal this year of becoming a leading provider of genre-based channels to audiences adopting Connected TVs as a primary destination for their viewing time".
“Our unique and socially connected content style is perfectly aligned with what this audience is looking for. We expect more channel launches to be announced this year and of course, we believe that Q GameX can be a big winner on these platforms.”
Netflix (NASDAQ: NFLX) is another business looking to take advantage of the popularity of gaming. The streaming service giant was founded in 1997 and originally made its name as a movie rental service before becoming the biggest name in streaming.
Now, the company is turning its attention to the world of gaming.
The move started with the company’s ‘choose your own adventure’ style on-off episode of Black Mirror, titled Bandersnatch, which was released in December 2018. The interactive show allowed users to make choices and change the narrative, allowing them to experience different plots and endings.
This was Netflix dipping its toes in, but appears to have been a sign of things to come. After launching a series of mobile games in November 2021, the company has been consistently releasing new game content. It has currently built up a portfolio of more than 20 titles.
The company’s emphasis is on accessibility for all users, with the goal being increased engagement from subscribers. To this end, it has acquired several development studios and claims to have a strong pipeline of new releases for the next couple of years.
Walt Disney Co (NYSE: DIS) is another entertainment giant which has an eye on the gaming space. The company has a long history of engaging with gaming, with releases coming in the form of numerous movie tie-in titles and standalone efforts featuring famous characters such as Disney Infinity and Epic Mickey.
September will see a major new release for the company with copies of Disney Dreamlight Valley hitting the physical and virtual shelves in early access form. This title, which is available across all major console platforms, is free to play and will allow gamers to solve mysteries, embark on quests and build their own village, all while accompanied by Disney’s famous roster of characters.
Back in 2020, it was reported that the company was looking to team up with game studios in order to increase the number of titles featuring Disney-owned intellectual properties.
With enormous properties like Star Wars, The Simpsons, The Marvel Cinematic Universe and much more besides in its back pocket, Disney is well-placed to benefit from a big push into the gaming industry.
Another business with one eye on streaming and another on gaming is Apple (NASDAQ: AAPL). The company hasn’t always been the friendliest to gamers, with macOS still limiting the titles that users can access compared to the wealth of gaming riches available to PC users.
Additionally, the company designed the now largely forgotten PiPP!N console in the mid-1990s. This console performed poorly as it tried to compete in a saturated market full of more warmly received competitors.
However, recent years have seen the company attempt to embrace the gaming market more and more, with the most significant move being the launch of Apple Arcade in September 2019.
This is a subscription-based service that offers gamers access to a range of titles without advertising, in-game transactions, data tracking, or the need for a constant internet connection.
A report released by JPMorgan analyst Samik Chatterjee estimated that the platform will be pulling in revenues of around $1.2bn by 2026, compared to around $7bn from the Apple Music streaming service.
Combined, the Apple Store, Apple TV+, Apple Music and Arcade reported revenue of $19.82bn in the three months ended 31 March, though Apple has not released a breakdown of which service produced what.
Apple’s offering is minor and focused on mobile titles at the moment, but the company is more than capable of backing a more significant push into the gaming market.
ValueTheMarkets.com News Commentary
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