Google is said to be preparing to buy Twitch.tv, the video game streaming platform, for one billion dollars.
Variety’s Todd Spangler reports that Google’s YouTube unit and the fast growing streaming service have reached an agreement that could be announced imminently. The story is partially confirmed by the Wall Street Journal, which reports that a deal is indeed under discussion, but is still far from completion. Twitch, reports the WSJ, is also exploring raising additional funding from investors as an alternative to a sellout.
According to The Verge’s sources, Google and Twitch have agreed upon a $1 billion deal, but the two parties are still discussing some aspects, including the level of autonomy Twitch would get to preserve within Google. Twitch has reportedly turned down bids from other suitors, including Microsoft.
Twitch has reportedly turned down bids from other suitors, including Microsoft.
Given their market shares, a YouTube and Twitch alliance would be scrutinized by regulators, and Google is said to be expecting some resistance.
With more than 45 million monthly users, Twitch is the largest service dedicated to video game streaming. The service became especially popular after Microsoft and Sony integrated it in their Xbox and Play Station consoles, and currently more than one million users upload and share their gaming exploits on Twitch.
In March 2014, Twitch accounted for 1.35 percent of downstream traffic on North American fixed broadband networks, which may not seem much but is still a huge share for an independent, niche service. At peak hours, Twitch moves more traffic than giants like Facebook or Amazon.
While still dwarfed by YouTube in total audience and traffic, Twitch is especially strong in the live streaming category – an estimated 44 percent of the traffic that was live streamed in the US in the first week of April came from Twitch, as per streaming analytics company Qwilt. Google, through YouTube, offers its own live streaming service, but Twitch has the upper hand in this category.
By buying Twitch, Google could shore up YouTube and make it the dominant force in live streaming video game content, and potentially other types of content. Google is rumored to make an assault on our living rooms this year, with the so-called Nexus TV, a set-top-box/console device running a custom Android implementation. Twitch-powered live streaming would be a natural fit for such a device.