Netflix has continued to grow from strength to strength in the last few years, dominating the world of streaming with cult originals like Stranger Things and gripping documentaries like Making a Murderer. Now, the company is eyeing up the world of video games.

Just a few weeks ago, news broke that the company had hired Mike Verdu, formally of EA, Atari, and Facebook, to help flesh out a brand-new games division. The company has now confirmed this new direction in an investor call, stating that initially there will be a focus on mobile games.

The games will sit within the Netflix library and come at no extra cost to subscribers, and Netflix isn’t ruling out other forms of games development in the future. We don’t know yet whether they’ll be licensing games from other studios on its own platform for cloud streaming or developing its own original titles which tie into existing shows/films.

We discussed Netflix's new gaming ventures in our weekly podcast Fast Charge, which you can watch below:

This new direction may seem unexpected at first glance – the company are entering a saturated market with little experience behind them, bar the interactive Black Mirror episode Bandersnatch and the TV adaptation of Minecraft: Story Mode.

However, if you dig deeper, Netflix has gradually been planting the seeds to expand into gaming by getting to know the target audience and building relationships with established studios. This could give us a glimpse into where the company is eventually aiming to be.

In the last few years, Netflix has ramped up on video game adaptations. The Witcher became the most popular first season on the platform after its release in December 2019, whilst Castlevania was critically acclaimed for its dark and gory style of anime.

Castlevania

There’s also been announcements of new series, including Sonic Prime, an animated series in collaboration with SEGA; numerous Resident Evil series with Capcom; an Assassin’s Creed series with Ubisoft; a newly announced Pokémon live-action show; several other Witcher animated spinoffs; and a series based off Cyberpunk 2077.

The last few series are all based on video games from Polish studio CD Projekt Red, which co-hosted WitcherCon with Netflix - a virtual convention highlighting news and features across the entire Witcher franchise. Throughout, Netflix demonstrated a key understanding of this audience.

One hilarious example is that in the build-up to the event, the team hosted a ‘hot tub stream', with a cosplayer dressed as Geralt of Rivia in a bathtub, which raked up tens of thousands of views. This ongoing joke is notorious in the Witcher fandom, and it’s clear that Netflix have managed to tap into this fan base.

This is down to the establishment of the Geeked publishing division, which is dedicated to all nerdy properties related to gaming, comics, sci-fi and fantasy. For this, the company hired experts in the area, including several ex-editors from leading gaming media business IGN.

The Geeked team helped run WitcherCon, and played a huge role in drawing in the fandom of The Witcher for views and building hype around the new properties. This demonstrates that Netflix knows that to crack the gaming world, they need fandoms on board – and this con was the first experiment.

Of course, there are challenges ahead. Gaming industry analyst Michael Pachter believes that the time constraints and the apparent lack of staff will fall short of the company’s ambitions. In a quote to Forbes, he states, “Netflix hired a coach. They have no players... I say they have a zero probability of pulling this off, because of the technological hurdles".

There’s no doubt that a year from now is a quick turnaround to be releasing games after just announcing this new venture. Many Hollywood studios have tried to break the gaming market and have failed, including huge labels such as Disney and NBC Universal, which have both shut down divisions dedicated to these properties.

However, we know very little about how long these plans have been in the pipeline. The relationships with studios suggest that it has been a while, and Netflix could have already struck a deal with one (or several) of them for these new games in private. I’d put money on CD Projekt Red, considering how much the two companies have collaborated.

Nightmare of the wolf

Even if the first properties that are released aren’t stellar, Netflix’s churn model for its shows and films could also apply to games. Mobile games require a fraction of the development costs and power that console games do, so this is the best area to use as a testing ground to just get properties out into the world and build up a portfolio before moving onto bigger things in the future.

During the investor call revealing the company's mobile gaming plans Netflix’s chief product officer Greg Peters stated, “There's no doubt that games are going to be an important form of entertainment and an important sort of modality to deepen that fan experience, so we're going to keep going, and we'll continue to learn and figure it out as we go.”

Mobile games also have the additional benefit of making the cost of a monthly subscription more valuable in a market that’s becoming increasingly competitive. GameIndustry.biz believes that the purpose of this division is “to boost the value of IPs and fans' engagement with them, while also building some extra value into people's existing Netflix subscriptions.”

In a different interview with the Financial Times, Pachter stated that existing IPs such as Bridgerton don’t lend themselves to gaming adaptations. To that, I say look at the popularity of visual novels and dating simulators such as Monster Prom. This type of game could also easily be hosted on mobile. 

Monster Prom

This gaming venture spotlights Netflix’s long-term plans: to become a multimedia platform across numerous areas. Whilst Disney and Amazon are rivals in the film and TV streaming world, these businesses have numerous other branches of revenue streams to pull in new customers.

Netflix is currently experimenting with other areas besides gaming. The company is developing N-Plus, a social media platform designed to create a community of Netflix subscribers. It’s also building up a podcasting division – the very first audio drama, Rebel Robin: Surviving Hawkins (based on the character from Stranger Things) launched at the end of June.

The goal is to build properties that work in tandem with the flagship series. Just like Disney has theme parks and an empire of toys, Netflix is looking to have games, audio shows, and online communities that will strengthen and grow fandoms into the new heights, and consequently, grow subscriber bases.

The potential for Netflix to succeed in the gaming space is there in theory, but whether the execution will land remains to be seen.

What I’m watching this week

Marvel Studios' Assembled dives into the creative process of the MCU live-action properties in Phase 4. There’s currently only three episodes out, but if you love VFX and the filmmaking process in general, then these are a must-watch.

You’ll see things such as how the first episodes of WandaVision were filmed in front of a live audience with practical effects, and the mad struggles that the crew of The Falcon and The Winter Soldier encountered from nearly being stuck in Prague during the pandemic.

The latest episode focusing on Loki details the God of Mischief’s journey through the MCU, and how this show ties into a much greater narrative – tune in now by signing up for Disney+.