The Big Gaming Opportunity Netflix Should Seize
Between its recent layoffs, sweeping changes to its culture memo, another comedy special inundated with transphobic material, massive stock decline and its first subscriber drop in more than a decade, Netflix continues to make headlines in 2022 for less than desirable reasons.
Regardless, the streamer’s push into gaming seemingly chugs on but could use more heft.
Per The Washington Post in April, Netflix intends to have released close to 50 mobile games overall by the end of 2022, a goal undoubtedly aided by the purchases of game studios Night School, Boss Fight Entertainment and Next Games, the last two of which occurred in March.
This includes Next Games’ “Stranger Things: Puzzle Tales,” a 2021 release predating the launch of Netflix’s November 2021 mobile push that will now relaunch in Q4 as a Netflix exclusive.
Data from digital intelligence and performance metrics firm Sensor Tower shows that global installs of Netflix games on iOS and Android have decreased steadily since December 2021 as the number of games released has dwindled. April’s global installs were just over 1 million and less than half of the installs in December, heightening the pressure to roll out more games and justify this push amid the company’s wider issues.
While Netflix mulls over adopting an ad-based tier like what other streaming rivals ad, its mobile games don’t feature ads or in-game purchases, a strategy that defies the revenue streams that comprise mobile gaming and make mobile the leading sector of the global games market.
There is some logic to this, as games can be addicting. If someone subscribes to Netflix ahead of the fourth season of "Stranger Things" dropping Friday, checks out one of multiple “Stranger Things” games after watching the first batch of new episodes and likes one enough to keep playing, they could conceivably stay subscribed even after the second batch of episodes releases in July.
But while Netflix can develop however many games it wants tied to new releases of its IP, there is a much bigger opportunity to boost subscriber value via its existing and upcoming adaptations of much bigger gaming properties.
Netflix has had major hits by way of “The Witcher,” an adaptation of the book series popularized by CD Projekt’s highly popular games, as well as “Arcane,” an anime series derived from Riot Games’ esports stalwart “League of Legends.”
Likewise, the streamer is releasing a live-action “Resident Evil” series in July after the new season of “Stranger Things” concludes, having already released an anime series tied to Capcom’s long-running series of horror games.
The games that spawned these series are mostly played on consoles or PC, the same mediums by which many people already access the Netflix library. If watching any of these Netflix shows results in an itch to play these games, it’s as simple as shutting down Netflix and opening their apps.
So why not partner with a major gaming player for a perk that grants Netflix subscribers free access to these games? Xbox recently announced a deal granting eligible Hulu subscribers three free months of its PC Game Pass subscription and previously granted subscribers of its Xbox Game Pass Ultimate tier a free month of Paramount+ in tandem with the premiere of the streamer’s “Halo” series.
The lack of something like this on Netflix’s end feels especially absurd given that the streamer’s biggest partner on the film side is Sony Pictures. Through two separate and exclusive deals, the streamer receives the studio’s theatrical films after they leave cinemas and is also granted first-look access to Sony films that hit the VOD market first or skip intended theatrical runs.
What other division is Sony known for? Sony Interactive Entertainment, the home of all things PlayStation, which is also seeking to boost subscribers for PlayStation Plus, its gaming service that rivals Xbox Game Pass and is set to launch a new three-tier structure June 13.
The new-and-improved PlayStation Plus will fold in SIE’s struggling PlayStation Now streaming and download service into its top two tiers, granting access to hundreds of games, while maintaining its current perks comprising monthly free games, online play and cloud saves in its lowest tier.
Likewise, the service’s top and middle tiers will also include access to Ubisoft+ Classics through a deal with the French publisher, showing that Sony sees value in partnering with outside entities in order to bring subscribers up past the 50 million mark, as PS Plus has hovered just above 45 million for almost two years now.
Given that Sony’s film studio has dipped into the PlayStation IP well already via February’s successful “Uncharted” adaptation, the partnership opportunity here is more than obvious, as “Uncharted” will soon stream on Netflix, as will any “Spider-Man” film released through 2026. The ability to switch from watching such films on Netflix to their gaming counterparts on PlayStation, where multiple AAA “Spider-Man” games from SIE’s Insomniac studio reside.
Netflix is embroiled in controversy, but its large subscriber base is still lucrative to utilize, and SIE isn’t a stranger to controversy itself. President and CEO Jim Ryan came under hot water recently for an alleged companywide email that encouraged employees to “respect differences of opinion” regarding abortion amid the Supreme Court’s expected overturn of Roe v. Wade, per Bloomberg.
That sentiment didn’t sit well with employees who would rather respect the right to women’s bodily autonomy and seemingly countered soon-to-be SIE subsidiary Bungie’s explicit pro-choice support.
Netflix is determined to make its mobile games work, but a partnership with PlayStation would build upon its existing relationship with Sony to bring more immediate value to subscriptions at a time when Sony is hoping for the same with PlayStation.