IBC
Live streaming community-building platforms are taking on television and Twitch is at the forefront.
There is no question that global quarantine has supersized the live streaming industry. There’s also no doubt about the winner. Amazon-owned Twitch is crushing all comers, including Facebook and Google, and now it’s bursting out of esports and gunning for TV.
While Facebook Gaming’s monthly views leapt 238% in April this year, according to data compiled by streaming software company StreamElements with analytics partner Arsenal.gg, its monthly total of 291 million hours was beaten by YouTube Gaming, which recorded 491 streaming hours in April.
Both are swamped by the near 1.5 billion hours watched in the same month on Twitch, as overall viewing to the platform has soared over 100% year on year.
Lockdown notwithstanding, Twitch’s hold is extraordinary. Acquired by Amazon in 2014 for $1bn, Twitch now controls 76% of the live-streaming market. The platform boasts 17.5 million unique daily visitors, an average viewership of over 1.5m at any time and over 4 million ‘creators’ streaming each month.
A rival platform from Microsoft called Mixer, lured star streamers with mega-bucks contracts but will close next month having failed to generate sufficient traction.
“Twitch remains unique in Western markets for a number of reasons,” says Piers Harding-Rolls, research director, games at Ampere Analysis. “These include the Twitch Prime feature, which gives Amazon Prime subscribers one free channel subscription a month. This has seen subscriber numbers increase significantly which has helped streamers generally, and this feature also acts as a great on ramp for further viewer monetisation. Twitch is also leading the way in game-related viewer benefits such as access to free games or in-game content.”
Twitch has been a pioneer in many ways for both streamers and viewers particularly in areas such as monetisation and social features but what should make the platform of vital interest to traditional media is that it is showing significant growth outside of gaming.
“Any cultural shift at Twitch is notable, since the future of Twitch will more or less be the future of streaming,” declared Yahoo Finance.
Cultivating non-gaming content The broadcast of four Premier League matches starting this month is just the latest mainstream content to be streamed on the site as a part of a multi-pronged strategy to expand beyond its core audience.
In the past, Twitch has streamed Saturday Night Live and Knight Rider, as it toyed with audience appetite for older broadcast content culled from the Prime library.
The company introduced a series of specific categories - badged Art, Hobbies & Crafts, Food & Drink, Science & Technology - for streamers wanting to broadcast non-gaming entertainment.
Last autumn, the company refreshed the site’s design and launched an advertising campaign ‘You’re Already One of Us’, to position Twitch as an all-purpose live-streaming platform.
A live science fiction series, Artificial, won the platform its first Emmy, for outstanding innovation in interactive media. Under lockdown, the Music & Performing Arts category has seen its number of hours watched quadruple as acts joined the site to mitigate the impact of lost touring revenue due to the pandemic. As a result, the platform has been targeted by music rights lawyers, which threatens to hinder its growth in this area, according to Harding-Rolls.
In October, it began experimenting with ‘Watch Parties’ a feature allowing its most prized ‘creators’ to stream Amazon Prime Video series like Jack Ryan to their viewers. The host is able to commentate on the video in real-time from a live webcam feed, as well as offer a live-chat in which viewers air their own opinions.
“Because Twitch’s desire is to build communities around interactive experiences, we were already on track to launch these types of things ahead of Covid-19,” said Erin Wayne, Twitch’s director of community and creator marketing. “[Covid] just happened to coincide with all of the things that we were doing.” The feature is now available to all U.S. Prime members and is on track to go live worldwide later this year.
All of this activity is being facilitated by initiatives, such as a Twitch Studio app, designed to make it easier for non-gamers and novice streamers to host broadcasts on the site.
“With mainstream social media platforms focusing on mobile, Twitch has become the go-to alternative for those requiring more specialised tools and PC, or other gaming device, integration,” says James Manning Smith analyst at Futuresource Consulting.
Elgato’s Stream Deck, for example, is a simplified production switcher which helps one-person broadcasters live stream by mixing scenes, launching media and adjusting audio.
Amazon has also leveraged deals it has made with other sports leagues for carriage on Prime by sharing those rights with Twitch. The 2020 NFL season commences in October including 11 games on Twitch that will be streamed free to Prime members in a renewal of a deal that began in 2018-19. The viewing experience includes interactive features like X-Ray and Next Gen Stats powered by AWS and user-selectable alternative audio options and commentary from Twitch users.
Live-streamed sports commentary allows viewers to interact with the commentator and represents a shift away from traditional game broadcasts. “It’s a tell about the future of TV,” said Anthony Danzi, the company’s SVP of sales at an advertising conference last September.
“Football appears a natural fit for social video,” notes Harding-Rolls. “Also, as we have seen where virtual sports have replaced live sports during lockdown, this experiment exposes new audiences to fresh experiences.”
It is not just popular culture but breaking news for which Twitch is gaining a reputation. A side effect of the heated debates during Brexit last autumn was a growing fanbase for the UK Parliament channel streamed on the site. Again, the site’s real-time chat interaction was cited as a reason. Viewers could pepper their contributions with emotes (Twitch’s terms for emoji’s) of Boris Johnson, Jeremy Corbyn and the Speaker.
During the Black Lives Matter protests earlier this month, the site was prominent as a hub for airing sit-ins and marches. According to The New York Times, some protesters and citizen journalists created Twitch channels just to broadcast the protests, while gamers who were already on the site switched to showing the demonstrations instead of video games. Other Twitch users simultaneously pulled together up to 10 protest live streams from places including Nashville and Washington, D.C., into a single feed, so that people could see the action in multiple cities at a glance.
The report said activists chose Twitch because they were familiar with the site from video games and wanted to leverage an existing tech-savvy audience. Twitch also has some technical tools for live broadcasting that other platforms lack, they said, such as a robust moderation system to avoid spam in chats.
Social broadcasting However, it is Just Chatting that has led Twitch’s growth over the past year. Launched in 2018, this is the Twitch category for conversations between streamers and viewers with no requirement for it to focus on gaming.
Last October, Just Chatting beat both League of Legends and Fortnite to become the most popular category on Twitch, according to Esports Observer. Stream Elements calculates Just Chatting has outpaced Twitch’s core growth rate four-fold since 2018.
Live interaction between creators and fans is the key to Twitch’s community building and is part of the social broadcasting phenomenon which for some is the future face of live TV.
Unlike Instagram, Snapchat and TikTok which have popularised the creation and sharing of snackable content, Twitch, has provided a platform for long format content.
“It is Twitch’s focus on engagement during long-form broadcasts which helped in creating a unique offering despite video sharing being a crowded market,” says Manning Smith.
The platform’s success in mixing gaming with sports and entertainment has brought competitors to the market. The most notable of these is Disney-owned Caffeine which broadcast the X Games in 2019 and has deals with the rappers Offset and Lil Xan. “We want to bring the world together around friends and live broadcasts,” proclaimed its CEO Ben Keighran, CEO.
Launching next month in the U.S is Videogame Entertainment and News Network (VENN), a live streaming lifestyle channel which counts Twitch co-founder Kevin Lin as an investor. VENN’s content will not only be delivered linearly across cable but also to Twitter, Facebook, YouTube and Twitch.
Other online platforms have also highlighted their potential as a live events space, with Fortnite recently hosting a Travis Scott in-game concert and a Marshmello concert in 2019.
“While gaming remains central to Twitch’s offering, and a cornerstone of social broadcasting dedicated platforms, the trend away from gaming content is set to continue, with a variety of media companies and celebrities turning to social broadcasting as a new outlet,” says Manning Smith.
Much like YouTube, Twitch makes money from advertisements, which it integrates into its streams; it also makes money from subscriptions. Twitch also earns a cut of the site’s in-app currency called ‘Bits’; viewers buy Bits to fund live shout-outs to streamers they like.
“Twitch has also generated an audience demographic considered hard to reach through traditional media outlets, with time spent gaming often coming at the cost of linear TV,” says Manning Smith. “Advertisers, brands, and content owners have considered Twitch a means to reach this demographic.”
The Twitch audience is indeed highly desirable for advertisers with 81.5% of viewers being male and 55% being between the ages of 18-34, according to marketers Izea.
In 2018 Twitch was valued around U$4 billion, according to one analyst. Its worth now will be a lot higher.
Amazon’s role The role of the largest retailer on the planet shouldn’t be ignored. “Twitch is a rounding error,” Michael Pachter, a research analyst for Wedbush Securities, is reported in the New York Times, speculating that it is most likely about U$250 million a quarter.
“First and foremost Twitch is a value proposition for Amazon Prime subscribers,” summises Harding-Rolls. “In addition, Twitch is pursuing other growth strategies to become a more significant revenue stream in its own right. These include diversifying outside of gaming content, increased streaming support for mobile games, increasing interactivity of streams, integrating more heavily with ecommerce (particularly around gaming) and using it as a user acquisition tool for Amazon’s own gaming ambitions.”
Recent reports suggest Amazon is looking to add more live TV to Prime Video. Protocol cites posted job adverts as indicating that Amazon is looking to “redefine how customers watch 24/7 linear broadcast TV content” by “designing the end-to-end customer experience for how customers discover and watch Linear TV content.”
Could it be that Amazon is poised to port the Twitch interface with its integrated chatroom to Prime Video?
“Amazon has integrated Twitch into its wider Prime service, through offering Twitch Prime subscription offering a free Twitch subscription each month, free games, in game items, and access to other Prime membership benefits,” says Manning Smith. “It’s likely that Twitch Prime is only the beginning of Amazon’s further expansion.”
It’s also worth noting that Amazon has a data lake on millions of individual users which Twitch has apparently yet to take advantage of.
“We’re owned by Amazon, so that gives us access to a whole lot of data,” Danzi said last year. “We philosophically still haven’t decided how we want to use that.”
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