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Netflix's gaming push likely to cause tension with platform holders

16 Aug 2021 | Rasmus Larsen |

Netflix has confirmed that its is expanding into games, without ads and in-app purchases and at no additional cost. The move is likely to cause tension with platform holders like Apple and Microsoft.

Netflix's gaming ambitions

In 2019, Netflix CEO Reed Hastings said that "we compete with – and lose to – Fortnite more than HBO". Last month, the company announced a move into gaming. - "We’re also in the early stages of further expanding into games, building on our earlier efforts around interactivity (eg, Black Mirror Bandersnatch) and our Stranger Things games. We view gaming as another new content category for us, similar to our expansion into original films, animation and unscripted TV. Games will be included in members’ Netflix subscription at no additional cost similar to films and series. Initially, we’ll be primarily focused on games for mobile devices," Netflix said in its recent earnings report. Greg Peters, Chief Product Officer at Netflix, added that games on Netflix will be free of ads and in-game purchases. The company did not comment on any specific games, partners, or even the distribution method, although most expect Netflix to deliver games through streaming rather than downloads.

Netflix game

This picture of Sony's DualSense was found in Netflix's app code. Source: Steve Moser

Tension with platform holders

References to 'Netflix game', codenamed 'Shark', as well as the PS5 controller and Sony's Ghost of Tsushima were discovered in the code of the Netflix app by Steve Moser, but it is unclear if there is any connection to PlayStation. Still, it would make sense for Netflix to have a strong launch partner. The company is already fighting with Apple over interactive content, which is not available on Apple TV. Apple's guidelines effectively block 'streaming games', i.e. "Netflix for games"-type services like Google Stadia, PlayStation Now, and Xbox Game Pass. And how will Sony and Microsoft respond when Netflix sneaks in games through the side door on PlayStation and Xbox? The consoles are not currently open to competing game services or game stores. Perhaps that explains why Netflix will initially focus on mobile games. Even if platform holders reject Netflix's app update to enable gaming, Netflix can follow Microsoft's example with Xbox game streaming through web browsers. This is much harder to do on Smart TVs, streaming boxes, and consoles, mainly because few of them have open and capable web browsers and/or wide support for game controllers. Nevertheless, Netflix made it clear that it is hoping to eventually offer games on all platforms. - "[...] ultimately, we see all of the devices that we currently serve as candidates for some kind of game experience," said Greg Peters, Chief Product Officer, Netflix. Netflix has not provided a timeline for its plans to add games to the service.

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