According to unconfirmed reports, Google is going to acquire Twitch for $ 1 billion. What for?
The Variety edition was the first to announce a deal between YouTube and Twitch yesterday. And reported that it will cost the first a huge sum of $ 1 billion.
The Wall Street Journal reacted almost immediately, noting that the deal between the companies is still at an early stage of discussion.
But why would an Internet giant need Twitch?
TwitchLet’s figure out first what Twitch is.
Today it is a fast–growing service that allows you to conduct live video game broadcasts. Users can use it to show how they play a particular game, and at the same time comment on the whole thing out loud (and even on video, if there is a webcam). Other users, respectively, can comment on what they see in the chat.
In June 2011, its monthly audience was 5 million people. In 2012, this number increased to 20 million. In the middle of last year, it became known about overcoming the 45 million mark.
According to Re\Code, Twitch is responsible for 1.35% of American Internet traffic at peak times. This is more than HBO Go, which has 1.24%.
Twitch earns money from advertising (including targeted advertising) and paid subscriptions that allow you to unsubscribe from this advertising on a specific channel for $ 5 per month (the company has more than 300 thousand subscribers).
And that’s such a successful service Google can acquire.
What for?Mobile video advertising is booming today.
With its help, free-to-play games and applications are perfectly monetized (75% of mobile videos viewed are opened inside applications).
At the same time, everyone in the mobile market is concerned about finding new viral channels.
For example, Unity recently acquired the creators of the EveryPlay service, which allows you not to broadcast, but to record the gameplay in mobile games, and then share it.
Twitch “kills” two birds with one stone. It allows you to broadcast from mobile games, share them, as well as conduct targeted advertising campaigns.
In other words, Google, buying Twitch, acquires an excellent advertising platform, an excellent add-on for Google Ads.
What do you think about the deal?