Season 2, Episode 9: Podcast: Looking forward to 2024 in mobile gaming (with Matthew Kanterman)
Jan 9, 2024
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In this episode, Matthew Kanterman and the host discuss alternative mobile gaming payments, industry consolidation, Microsoft's gaming ambitions, and Netflix's gaming strategy. They also touch on legal battles between Epic Games and tech giants, challenges in the mobile gaming market, and potential shifts in revenue strategies.
Netflix prioritizes reducing churn with games over driving growth or revenue, facing potential financial challenges.
Introducing in-app purchases in Netflix games could shift the monetization strategy and business dynamics.
Consolidation in the AAA publisher market post Activision acquisition may reshape the gaming industry landscape.
Deep dives
Netflix's Gaming Strategy: Churn Reduction Through Games
Netflix's gaming strategy appears to focus on reducing churn by offering games, rather than driving significant subscriber growth or incremental revenue. The free games provided by Netflix serve as a method to retain subscribers, though the economics of the strategy may not fully align with the spending on game development and significant ad costs.
Possible Shift: Incorporating In-App Purchases for Games
One potential shift for Netflix's gaming strategy could involve introducing in-app purchases (IAPs) to unlock monetization opportunities. Allowing individual games to monetize directly through IAPs could change the financial dynamics and analysis of the gaming business within Netflix.
Evaluation of Gaming Expansion with Streaming to CTV Apps
While Netflix has expanded gaming to Connected TV (CTV) apps, the viability of this extension remains debatable. Historically, efforts to integrate games within CTV apps have faced challenges in engaging users effectively, and the success of gaming offerings in this environment remains a topic of debate.
Consolidation in the AAA Publisher Market
The recent acquisition of Activision has opened up possibilities for consolidation in the AAA publisher market. Big tech and Hollywood companies may explore opportunities to acquire established publishers like EA or Take-Two, potentially reshaping the landscape of the gaming industry.
Challenges and Opportunities in the Gaming Industry
Navigating challenges like localization of content in diverse markets, unlocking revenue streams through innovative strategies like IAPs, and determining the ideal approach for expansion and consolidation within the gaming industry pose ongoing complexities and opportunities for companies like Netflix and major publishers.
My guest on this episode of the Mobile Dev Memo podcast is Matthew Kanterman, a respected gaming analyst who spent 8 years at Bloomberg covering companies in the interactive entertainment space, and who also spent time at Roundhill Investments covering the Metaverse.
I invited Matthew onto the podcast to consider the prospects for mobile gaming in 2024. In the episode, among other things, Matt and I discuss:
Alternative in-app and off-platform mobile gaming payments;
Further consolidation in mobile gaming;
Microsoft's mobile gaming ambitions;
and Netflix's strategy concerning mobile games.
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