Netflix is accelerating its push into video games with plans to double its catalog of offerings by the end of the year, but so far few of the streaming giant’s subscribers are playing.
Since last November, the company has been rolling out the games to keep users engaged between show releases. The games are only available to subscribers, but must be downloaded as separate apps.
The games have been downloaded a total of 23.3 million times and have an average of 1.7 million daily users, according to Apptopia, an app analytics firm. That’s less than 1% of Netflix’s 221 million subscribers.
The importance of games in Netflix’s overall strategy has arguably increased in recent months as the company faces increasing competition for user attention. In the second quarter, Netflix lost nearly a million subscribers, after losing 200,000 subscribers in the first quarter – its first subscriber decline in more than a decade.
In a letter to shareholders last year, Netflix named Epic Games and TikTok among its biggest rivals for People’s Time.
“One of Netflix’s many advantages in pursuing the strategy is the ability to drive engagement beyond the show’s first release on the platform,” said Tom Forte, analyst at Prosek Partners. .
Still, Netflix chief operating officer Greg Peters said last year that the company has spent “many months and really, frankly, years” learning how games can keep customers on the service.
“We’re going to be experimental and try a bunch of things,” Peters said on the company’s fourth-quarter earnings conference call. “But I would say the eyes we have on long-term prize are more focused on our ability to create properties that connect to the universes, the characters, the stories that we’re building.”
The company’s current catalog of 24 game apps spans a variety of genres and Netflix shows, such as “Stranger Things: 1984.” Several are inspired by popular card games, such as “Mahjong Solitaire” and “Exploding Kittens”.
The catalog will grow to 50 games by the end of the year, including “Queen’s Gambit Chess,” based on the hit Netflix series, according to a company representative.
Netflix has been suspicious of how it plans to make gaming a central part of corporate strategy, rather than just a side hobby.
“We’re still intentionally keeping things a bit quiet because we’re still learning and experimenting and trying to figure out what things will actually resonate with our members, what games people want to play,” Netflix head Leanne Loombe. external games, said during a panel at the Tribeca Film Festival in June.
Netflix hinted earlier this year that it would license popular intellectual property for its new game additions.
“We’re open to licensing, access to big game IP that people will recognize,” Peters said in January. “And I think you’ll see some of that happen over the coming year.”
Netflix has brought in outside developers for its current roster, but has acquired three video game developers in the past year.
All of this adds up to growing investments. Netflix hasn’t disclosed how much it’s spending to grow its video game segment, but the efforts are capital-intensive. Netflix’s acquisition of Finnish developer Next Games cost the streamer an estimated $72 million.
Forrester analyst Mike Proulx noted that Netflix is slowly investing in the game and it still seems to be what it would consider “more of a test and an experiment at this point.” He noted that most people don’t associate Netflix with games.
So far, Netflix game download numbers have lagged well behind major mobile games – Subway Surfers, Roblox and Among Us, to name a few. – which each have more than 100 million downloads, according to Apptopia. Still, downloads have been slowly increasing since May, following a downward trend that began in December.
“We have to please our members by having the best in class,” Netflix co-CEO and co-founder Reed Hastings said in January. “We have to be different in this area. There’s no point in just being in it.”