Netflix Exploring Cloud Gaming to Bring Titles to TVs and PCs, Will Establish In-House Games Studio in Southern California

Company to build studio around 'Overwatch' executive producer Chacko Sonny

Netflix Games

Netflix is just over a year into its active push into games — and it’s doubling down on the strategy.

Netflix’s VP of games Mike Verdu, speaking at the TechCrunch Disrupt 2022 conference Tuesday, announced that the streamer was “seriously exploring” a cloud gaming offering to be able to extend its catalog of games to be playable on TVs and PCs.

“We’re going to approach [cloud gaming] the same way we did with mobile, which is start small, be humble, be thoughtful, and then build out,” he said at the TechCrunch event, per a video replay. “But it is a step that we think we should take to meet members where they are, on the devices where they consume Netflix.” Verdu declined to say whether Netflix was developing its own controller for such a cloud gaming service.

Verdu drew a distinction between Netflix’s cloud gaming approach and services like Microsoft’s Xbox Cloud Gaming, Amazon’s Luna and the soon-to-be-discontinued Google Stadia. “For us, delivering games to your TV or to your PC, it’s value-add — like, we’re not asking you to subscribe as a console replacement, so it’s a completely different business model,” said Verdu, a former Electronic Arts, Zynga and Facebook VR/AR content exec who joined Netflix last year.

Verdu also revealed that the company plans to create a new studio in Southern California built around Chacko Sonny, the former Activision Blizzard executive producer behind “Overwatch” who previously oversaw development of “God of War” at Sony Interactive Entertainment’s Santa Monica Studio.

“We are building a team around [Sonny] and looking to him to help reinvent what games can be,” Verdu said.

A Netflix rep confirmed the plans but had no further additional info.

In announcing Q3 earnings Tuesday, Netflix said it now offers 35 mobile games — and that it has 55 more in development, including those based on Netflix franchises. All the games are included with every Netflix subscription without in-game ads or in-app purchases. The theory is that the games provide additional value to the core Netflix streaming-video subscription, and therefore reduce churn.

“Netflix doesn’t take very many big bets, if you look at the 25-year history of the company,” Verdu said. “And the company is very committed to [games] being one of them.” The games span a range of genres and gameplay formats, including “indie darlings” like “Into the Breach” and “SpongeBob: Get Cooking.”

“[W]e’re seeing some encouraging signs of gameplay leading to higher retention,” the company said in the shareholder letter. “More generally, we see a big opportunity around content that crosses between TV or film and games.” According to Netflix, after the launch of the anime series “Cyberpunk: Edgerunners” (49 million hours viewed) in Q3, gameplay of CD Projekt’s “Cyberpunk 2077” game surged on PCs.

Last month, Netflix announced that it was opening its first internal games studio in Helsinki, Finland, led by former Zynga and EA exec Marko Lastikka as studio director.