The Netflix of gaming? Why subscription video-game services face an uphill battle

 Many tech giants are betting that the subscription model will become dominant in video games. Yet the things that make gaming such an entertainment dynamo are problematic for these types of services.

Recent announcements of new game-distribution services from Apple, Google, Microsoft, NVIDIA, and Tencent, as well as reports1 of a prospective Amazon offering, have caused widespread industry speculation that video-game distribution could move from the still-dominant à la carte model toward Netflix-style subscriptions. If subscription services were successful, power could shift from game studios and publishers to a few digital distribution giants with massive scale and market share—analogous to the rise of Netflix in digital video.

However, comparisons with the TV and film business don’t entirely hold up—digital subscriptions will not translate to video games easily. Gaming’s unique consumption model and economics arguably make the challenge of altering consumer behavior to create all-you-can-eat offerings at massive scale a lot tougher than anything Amazon Prime, Hulu, and Netflix have faced.

Still, the stakes are so high—video games generated $120 billion in revenue2 globally in 2019—that the recent service launches are probably just the opening gambits. Any of the players making (or contemplating) bets on such a seismic shift in distribution and consumption would be wise to keep in mind that video games have several characteristics that make them ill-suited to the Netflix model.

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Πηγή: mckinsey

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