News broke over the weekend that Google and its YouTube division are looking to pick up the video game streaming company Twitch Interactive for an estimated $1 billion.
Google and Twitch have declined to comment on the news, which first broke in Variety.
Among gamers, Twitch is a very notable video-sharing site and community. But among the general public, that high price tag may be leaving many scratching their heads. Here's a look at what makes Twitch such a big deal.
(Note: Some of these videos are embedded livestreams and, the Internet being what is, potentially NSFW because of trash-talking.)
Watching other people play video games is a huge market
Twitch has long tried to convince people that watching other people play video games is like watching sports, or like watching professional poker. This has been the case for many years in places such as South Korea, a country with a serious "Starcraft" obsession. But other titles,
Twitch, depending on whom you ask, is bigger than Hulu or HBOGo.
Sandvine estimates that Twitch accounts for 1.35 percent of all U.S. peak Internet traffic, beating HBO Go. The Wall Street Journal, citing DeepField, put Twitch at 1.8 percent traffic, ahead of Hulu and trailing only Apple, Google and Netflix.
The game-streaming service has locked up partnerships with Microsoft's Xbox One team and Sony's PlayStation 4 team, as well as Amazon's Fire TV service, to stream games to those major game communities in real time. For example, this 25-second clip is the top-viewed video of the week, with 61,827 views. Just think about how unlikely it is for a personal moment to get any reach like that on most platforms.
It lets companies show off new stuff
The platform reported earlier this year that it has 45 million unique viewers who watch more than 12 billion minutes of video per month. Not only is that a lot of time, but it also demonstrates crazy growth: The number of minutes watched doubled between 2012 and 2013. With reach like that, Twitch has become a prime platform for gaming companies to reach their customers. Gameloft, one of the biggest mobile studios out there, has its own channel on Twitch to show off new releases and get gamer feedback.
It builds communities by letting people obsess over things together
The average person may not know much about Twitch. But service has a big, dedicated audience, and it knows how to chase them. As a consequence, it has become a huge platform for organic movements around gaming, as well as a place to test out new ways to play.
Case in point: Twitch Plays Pokemon, a wholly organic movement that drew at least 120,000 players together to play one game of the first version of Pokemon. Since then, the community has come together to tackle other versions of the popular game, and is now on its sixth game. The latest stream has gathered over 60 million views.