July 14, 2021
After much speculation, Netflix is reportedly set to enter the video game market, hiring a former Electronic Arts and Facebook executive to run the venture.
Bloomberg reports that the SVOD pioneer has hired Mike Verdu to join as VP of game development, reporting to Greg Peters, chief operating officer. Verdu most-recently worked with Facebook to meld game content with the platform’s Oculus virtual reality headgear. He was chief creative officer for Zynga from 2009 to 2012, reportedly involved with franchises such as “The Sims,” “Plants vs. Zombies” and “Star Wars.”
Games would be offered on Netflix alongside movies, TV shows, documentaries and kids fare at no additional cost, according to the report, which cited a source familiar with the situation.
While Netflix confirmed the Verdu hire, it has not responded whether it would begin renting digital games in 2022. Regardless, entering the gaming market would seem to be a no-brainer. The market has exploded since the begin of the pandemic and rollout of new gaming consoles from Sony PlayStation and Microsoft Xbox.
“There’s no doubt that games are going to be an important form of entertainment and an important sort of modality to deepen that fan experience,” Peters said on the April fiscal call. “So, we’re going to keep going and we’ll continue to learn and figure it out as we go.”
More than 212 million Americans play video games, according to the Entertainment Software Association. Through May, industry year-to-date revenue increased 17% to $24.02 billion, from $20.52 billion in 2020.
“This is a natural extension of Netflix’s content strategy, allowing it to mine intellectual property from popular shows like “Stranger Things,” Geetha Ranganathan, media analyst at Bloomberg Intelligence, wrote in a note. “Though it may not generate much additional revenue, it will help deepen engagement and increase the service’s appeal and pricing power. Don’t expect this to be a turning point, but it shows that the company will explore new formats to increase time spent on the platform.”
Netflix reports second-quarter (ended June 30) fiscal results July 20.