Pixel P&L: Why Twitch Can’t Turn a Profit

Good morning. It’s Tuesday, October 29. Amazon’s Twitch reigns in live streaming with 105 million monthly viewers and $2 billion in revenue. But even with a $46 billion valuation, profitability remains elusive. Our feature dives into how Twitch’s high creator payouts and soaring data costs make turning a profit a challenge for the streaming giant.

We also cover JioGames launching PC game sales on its store, the announcement of DreamHack India 2024, and more.

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Amazon’s Twitch Dominates Live Streaming but Struggles for Profitability

With 105 million monthly viewers and more than 7 million active streamers, Amazon-owned Twitch is the leading name in live streaming, drawing audiences for gaming, art, and niche content like “hot tubs.” Yet, despite a staggering $2 billion in annual revenue and a valuation of $46 billion, Twitch remains unprofitable—an unexpected outcome for a platform of such scale and appeal.

The issue lies in its payout model: Twitch distributes roughly 67% of its revenue to creators through subscriptions, Bits, and ads, leaving slim margins to cover its immense infrastructure costs. Running high-definition, real-time streams worldwide demands costly data resources, putting financial strain on the platform. Combined with revenue-sharing models designed to attract top creators, Twitch faces substantial operational expenses that outstrip its earnings, even as it undertakes cost-cutting measures like layoffs.

In our feature story, we explore the financial challenges behind Twitch’s popularity and unpack the numbers behind the hurdles impeding its path to profitability. 

JioGames Expands into PC Game Sales With Diwali Promotion

JioGames has launched PC game sales on its platform, marking a strategic shift from its existing JioGamesCloud service to offering full digital ownership for gamers. As part of the Diwali Games Fest, the JioGamesStore, accessible via its mobile app, now sells popular Bethesda titles directly to users at discounted rates.

Unlike JioGamesCloud, which allows users to stream games without the need for high-end hardware, the new store enables gamers to purchase and download full PC titles, granting offline access and permanent ownership. This new model appeals to traditional PC gamers, a group that values digital licenses and the option to play offline.

The PC games vertical of JioGamesStore has launched with an initial roster of 11 Bethesda titles, including Starfield, The Elder Scrolls V: Skyrim, and the Fallout series. The JioGamesStore also features digital vouchers for popular platforms like Steam, Xbox, and PlayStation, further widening its appeal to the gaming community.

This shift signals JioGames’ ambition to transform into a comprehensive gaming hub in India that includes, broadening its market reach and solidifying its role in the country’s gaming ecosystem.

Quick Bytes

Krafton Enlists Neeraj Chopra to Promote Battlegrounds Mobile India

Krafton India has launched a promotional video for Battlegrounds Mobile India (BGMI), featuring Indian track and field star Neeraj Chopra. The video captures Chopra discussing in-game tactics, clutch plays, flight paths, and popular weapons like the M416 and grenades, showcasing his enthusiasm for BGMI. Additionally, the video includes 8bit Thug, co-owner of S8UL Esports, a prominent Indian esports organization. The campaign highlights Krafton’s commitment to localizing BGMI’s appeal, leveraging Chopra’s widespread popularity to engage Indian audiences as the game aims to expand its player base in the region.

DreamHack India 2024 Offers INR 45 Lakh Prize Pool Across Esports Tournaments

DreamHack India celebrates its fifth anniversary this year with a prize pool exceeding INR 45 lakh across multiple esports tournaments, taking place alongside Hyderabad Comic Con from November 15-17. Highlights include the Call of Duty: Mobile Snapdragon Pro Series with INR 24 lakh up for grabs, and the OMEN Campus Quest for VALORANT offering INR 5 lakh. Attendees can also enjoy KO Fight Night featuring top titles like Tekken 8, a chess championship, and a BYOD (Bring Your Own Device) segment covering mobile, PC, and console categories. The event, blending esports with cosplay, tech exhibits, and creator meet-and-greets, has tickets available on Insider.in.

Skyesports Championship 2024 Set to Return

Skyesports has confirmed the return of its flagship Skyesports Championship for Battlegrounds Mobile India (BGMI) in 2024. The event is set to conclude with a LAN final on December 14-15 at Bangalore’s Koramangala Indoor Stadium. 

Copyright Office Rejects Exemption to Aid Video Game Preservation

The U.S. Copyright Office has denied a proposed DMCA exemption from the Video Game History Foundation (VGHF) that aimed to support video game preservation efforts. Since 2021, the VGHF, alongside the Software Preservation Network, has advocated for libraries and archives to share out-of-print games digitally. However, current anti-circumvention rules limit remote access to these collections. Register of Copyrights Shira Perlmutter cited the Entertainment Software Association’s concerns, stating VGHF hadn’t demonstrated sufficient fair use to justify the exemption. The decision underscores resistance within the industry, complicating preservation efforts, with 87% of video games now considered “critically endangered.”

Did You Know

In an intriguing, now-abandoned effort, Disney once planned to bring two iconic video game franchises, Mega Man and The Sims, to the big screen. At the time, Disney saw the potential for these games to be adapted into unique film experiences that could appeal to fans of both classic video games and family-friendly movies. Mega Man, with its futuristic storyline and adventurous tone, was primed to attract young audiences with a CGI-driven approach, while The Sims, a life-simulation game without a specific plot, offered a blank canvas for inventive storytelling in the vein of playful family dramas or animated comedy.

However, these ambitious adaptations were ultimately shelved after the 2016 release of Assassin’s Creed, a video game-based film produced by 20th Century Fox, then Disney-owned, which disappointed at the box office. Despite an A-list cast and high production values, the film’s lukewarm reception exposed the risks of adapting games with complex narratives for film audiences. Following this underwhelming performance, Disney reassessed its strategy and decided to cancel both Mega Man and The Sims projects, leaving fans to imagine what could have been if these beloved games had made their way to theaters.

Quote of the Day

Obi Hajime, GintamaTears are handy for washing away troubling and sad feelings. But when you grow up, you’ll learn that there are things so sad, they can never be washed away by tears. That there are painful memories that should never be washed away. So people who are truly strong laugh when they want to cry. They endure all of the pain and sorrow while laughing with everybody else.”

from AFK Gaming https://ift.tt/dgqu8Kx