Amazon Gaming Opportunity

Final question and that’s Amazon. They’re entering the space and they obviously have Twitch, already. How do you look at the potential disruption or positioning of Amazon?

I think you mentioned the most important factor there which is that Amazon owns Twitch. Twitch is a very, very big part of the gaming ecosystem. It’s worth mentioning that Twitch sites alongside YouTube. YouTube is actually where a lot of game streaming is viewed and a lot of gameplay is viewed. The viewership business is split between YouTube and Twitch. Then Mixer, from Microsoft, comes in in a growing portion. But Twitch gives it a huge access and credibility to the gaming user base and, particularly, this growing category of viewership. Viewership is now almost as big as gameplay. People are spending as much time watching other people playing games as they are playing games.

What that means for Amazon, is that it has ready access to a very rich pool. One of the barriers to entry would be its credibility in the space and ability to access consumers and it has that and it also has a good knowledge of who is buying games, because it sells a lot of games and consoles through its ecommerce business. I think the combination of those two things, perhaps supplemented with their strengths on AWS, on their ability to deliver games to customers, means that if they can get their content proposition right, they have a great opportunity. Twitch already has a Prime premium membership, which you get with Prime, so they’re already kind of entering that space of subscription gaming. That’s been a good playbook for Amazon, as to how they build up a customer base. They did it with music, with Prime Music and then they’ve obviously done it with their delivery business. I can see the same thing happening here.

I think, initially, they are appealing in the PC space, but there’s no reason they shouldn’t expand that offering to a more broad-based subscription. I can see Amazon, if they’re willing to go into this space – and it’s not an easy space – having a good run at it.

It all comes back to the point we made around content. They have to have the content?

Yes, exactly. You’ve seen in the video space, with Amazon Prime Video, that they’ve had to invest billions and they’ve been willing to make that decision. I think it will be interesting to see whether they’re willing to make that investment.

Or they will just buy a publisher?

You can just buy a publisher but a publisher is a good way to spend money, isn’t it? A publisher gives you an infrastructure, a spending.