Netflix is exploring fresh approaches to generate revenue for its gaming division
In its pursuit of gaming success, Netflix is contemplating new avenues for monetization. Rumors suggest a potential strategy shift, with the streaming giant considering the introduction of play charges, optional in-app purchases, or in-game advertisements to enhance the profitability of its gaming endeavors.
According to sources cited by The Wall Street Journal, Netflix executives have been engaged in discussions about the revenue-boosting potential of these approaches. This move reflects the company's commitment to furthering its gaming ambitions and transforming into a multimedia brand capable of achieving success in the competitive gaming industry.
While Netflix's foray into gaming has been evident in recent years, its strategy has evolved from licensing intellectual properties for app store distributions to providing free mobile games as a subscription perk. The latest shift involves integrating games into its multimedia content niche, offering fans games based on their favorite franchises to bridge the gap between seasons.
Netflix's gaming arm is far from its final form, with over two years of experience in the gaming market. The company is following a "crawl, walk, run" approach, aiming to double its number of available titles in 2024 with nearly 90 new games in development. Reports suggest that these titles might introduce revenue generation models commonly seen in the mobile games space.
Despite boasting a game library approaching triple digits, less than 1% of Netflix subscribers reportedly play games daily. This limited engagement poses a challenge for Netflix's gaming venture, as it appeals to a fraction of its audience, limiting the potential for further monetization.
Rumors of console-quality games on the horizon raise questions about potential additional fees, especially considering the gaming upgrade of the iPhone 15 Pro. Console-level games may not be included in the standard Netflix subscription, leading to potential extra charges for games with higher production value. The market's readiness to endure ads or spend extra in-game for content already behind a paywall remains uncertain.
Successful implementation of these monetization strategies could support Netflix's ambitions to create creatively distinct games tailored to the Netflix on TV experience. However, if these attempts fall short, Netflix risks being perceived as money-focused, potentially affecting its ability to attract new subscribers, including gamers and non-gamers alike. The streaming giant continues to navigate the evolving gaming landscape with hopes of finding the right balance between user engagement and revenue generation.
Source: adapted from an article by Aaron Astle, News Editor for PocketGamer.biz.