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Last update: July 2021

4 mins to read - 2021/07/21

Netflix Expands into the Mobile Gaming Sector

The world of mobile as we know it is effectively a battle royale between different forms of content – from streaming, social media, cooking blogs, gaming… the list goes on. The prize: your attention. And the more stuff that’s out there trying to get a second of your time, the scarcer of a resource our attention becomes. Netflix has made it big in the industry of video streaming. From the very beginning, Netflix has been a groundbreaking innovator. And now they’re making headlines again, with recent news that Netflix are foraying into the games industry.

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Some might wonder if this might not be Netflix overreaching themselves – an act of hubris akin to Jeff Bezos going to space for 11 seconds in his anthropomorphic rocketship. After all, Netflix already has more than 203 million subscribers, and they generated nearly $25 billion in 2020. Mobile users downloaded their app for Android and iOS 19 million times in January 2021 alone. According to Fast Company:

“Unlike traditional broadcasters, Netflix’s goal isn’t to appeal to as broad an audience as possible but rather to cater to niches and effectively give every slice of the population a show or movie they can’t live without. Though Netflix is widely considered to be the platform that is winning the streaming-video wars, it has not rested on its laurels when it comes to improving the service.”

Netflix: An Innovator from the Beginning

Netflix’s staying power is largely due to their being incredibly adaptable, and capable of changing with the times. In its initial form, Netflix’s business model centered around DVD sales and rental by mail. However, while other video rental businesses quickly became obsolete with the rise of the internet, Netflix embraced the change and became the frontrunner of a new model of subscription-based video streaming.

Then, in 2012, it dipped its toe into streaming original content, with its first original series, House of Cards. Since then, various leading brands have sought to emulate Netflix’s model. Prime Video, Hulu, and Disney+ are all subscription platforms with rotating carousels of movies and TV series, each with highly marketed exclusive series and movies to lure subscribers over from their competitors. Netflix has since been edging in on Hollywood’s turf, releasing Oscar-contening films by notable directors, such as Martin Scorcese’s The Irishman and Pedro Almodóvar’s Roma.

Netflix even dipped their toe into producing games in 2018, with its choose-your-own-adventure interactive experiences such as Bandersnatch and Carmen Sandiego. As it turns out, there is a finite amount of content one person can watch.

netflix bandersnatch interactive movie games
image Source: Screenshot from https://www.netflix.com/ie/title/80988062

Netflix and Games

In 2019, Netflix CEO Reed Hastings prophetically stated:

“We compete with (and lose to) Fortnite more than HBO. Our focus is not on Disney+, Amazon or others, but on how we can improve our experience for our members.”

In July 2021, as part of its letter on Q2 earnings to shareholders, Netflix announced that it would be including mobile games as a part of user subscriptions. This may be a move to boost subscription rates, which have dropped in 2021 after a banner year that was 2020. (Like the mobile games industry, streaming services saw a huge uptick in users as a result of the COVID-19 pandemic.) In March 2021, it looked like Netflix was going to start cracking down on people who were sharing accounts. However, after people accused them of “tightening the screws,” they seem to have backed off.

Now, Netflix have partnered with Mike Verdu, the former executive of EA and Oculus, to be their VP of games development. In their letter to shareholders, they state:

“Initially, we’ll be primarily focused on games for mobile devices… We think the time is right to learn more about how our members value games.”

What Will Netflix Be Offering in Terms of Mobile Games?

So far, Netflix have not shared any details about they expansion into games. However, they have recently extended their TV deal with Shonda Rimes – the producer of Bridgerton – to include gaming content.

As a platform that suggests content to stream based on data-fed algorithms, Netflix has stated that it wants to put users’ preferences at the heart ofi ts new push into games. It doesn’t seem to focus on gaming as a primary revenue at the moment. There will be no additional cost for Netflix users to play games. In fact, COO Greg Peters seems more excited about the creative potential. He explores the value of possessing a trove of games, which are the intellectual property of the streaming platform.

“We know the fans of our stories want to go deep and engage further. What’s great about interactive is you can provide universes that provide a significant amount of time where people can engage and explore.”

So, could this mean sometime in the future we’ll see a hyper-casual Joe Exotic endless runner? Or a Bridgerton-themed roguelike where you play Daphne trying to navigate the back-biting Ton and come out of it with her reputation in tact? (You’re welcome, Netflix.)

Netflix and Push Notifications?

Either way, it looks like this is the dawn of a new era for Netflix. And, whether or not they ultimately plan to further monetize their games beyond the cost of subscription, venturing into games is their best bet for closing the attention gap. Our mobile devices are our primary interface with the rest of the world. Mobile games are with us all the time – literally in our pocket. And they have been optimized to be as addictive and engaging as possible.

In addition to design elements, such as aesthetics, music, and core game loop, mobile games have the added benefit of push notifications. Notifications are the ideal way to extend the UX of the game, even when the user isn’t in the app. Notifications let you speak to users in a relevant and personalized way. With them, mobile apps can reach out to users at the exact moment they’re most likely to engage.

Netflix has already excelled at sending personalized notifications, inviting users to pick up watching where they left off, or try something new. It should only be a quick jump to transition a similar engagement strategy for mobile games.

To read more about how to use OpenBack to boost player retention and maximize revenues, download our Case Study: Dreamworks How To Train Your Dragon App, School of Dragons

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