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Amazon buys Twitch for $970M, pushes into video streaming market

post #1 of 45
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Amazon on Monday grew its digital media presence with the purchase of gaming-centric video streaming service Twitch, which agreed to a $970 million buyout that will take effect later this year.




In a letter posted to the company's website, Twitch CEO Emmett Shear confirmed the Amazon takeover, framing the acquisition as an opportunity for further growth.

"We chose Amazon because they believe in our community, they share our values and long-term vision, and they want to help us get there faster," Emmett wrote. "We're keeping most everything the same: our office, our employees, our brand, and most importantly our independence. But with Amazon's support we'll have the resources to bring you an even better Twitch"

As noted by TechCrunch, Amazon confirmed the acquisition at $970 million in cash.

Twitch started life in 2011 as an offshoot of former live Internet broadcast site Justin.tv, itself cofounded by Shear in 2007, and was recently rumored to be in acquisition talks with Google and Yahoo. Over the past three years, Twitch has amassed a huge following that the company recently pegged at 55 million active users.

With its latest buy, Amazon makes further inroads into digital media content creation and hosting. The Internet retail giant is in the process of backing original TV shows to be served up on its Fire TV set-top streamer, which launched in April. The Apple TV competitor sports hardware capable of playing games via optional game controller, including a title created by the newly-formed Amazon Game Studio.
post #2 of 45

Unexpected. Way to spend all that extra money, Jeff... wait a sec...

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post #3 of 45
This is what happens when the DOJ allows a monopoly to freely exist. I don't understand where Amazon is getting this kind of money when they continually say they are keeping the cost of things they sell to the lowest possible amount. This doesn't add up. People yelled at Apple for paying 1/3 this amount for Beats. Is Twitch actually worth this much or is Amazon paying way too much?

50M active users, which works out to $20/user. So if every current user was charged $20, Amazon could pay off the bill.

Of course, Google was said to have been the buyer last month.

"In September, Twitch raised $20 million in funding from Thrive Capital, WestSummit Capital and Take-Two Interactive Software Inc , among other parties." Doesn't make sense when they're only getting $20M to keep alive that Amazon would pay close to $1B for them. Talk about an infusion of money.
post #4 of 45
Quote:
Originally Posted by rob53 View Post

This is what happens when the DOJ allows a monopoly to freely exist. I don't understand where Amazon is getting this kind of money when they continually say they are keeping the cost of things they sell to the lowest possible amount. This doesn't add up. People yelled at Apple for paying 1/3 this amount for Beats. Is Twitch actually worth this much or is Amazon paying way too much?

Of course, Google was said to have been the buyer last month.

"In September, Twitch raised $20 million in funding from Thrive Capital, WestSummit Capital and Take-Two Interactive Software Inc , among other parties."

 

Apple paid much more for Beats. $3 billion. Twitch.TV actually would've been a perfect fit for Apple TV.

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post #5 of 45
Quote:
Originally Posted by SpamSandwich View Post
 

 

Apple paid much more for Beats. $3 billion. Twitch.TV actually would've been a perfect fit for Apple TV.

I agree but I don't think Apple needs to own them outright.

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post #6 of 45
Quote:
Originally Posted by SpamSandwich View Post
 

 

Apple paid much more for Beats. $3 billion. Twitch.TV actually would've been a perfect fit for Apple TV.

 

At least Beats is an extremely successful company, making extremely successful, high margin, mainstream products that will pay for itself in no time. 

 

I play videogames, and have never used or had any motivation to use this twitch service. Sounds like a super-niche service that's ridiculously overvalued. 

post #7 of 45
Whats a Twitch?
post #8 of 45

This is great for Twitch's users.

 

Amazons Cloud services will come in handy with bandwidth and latency.

 

Although, Twitch Turbo will probably be replaced with Prime.

post #9 of 45
Quote:
Originally Posted by Slurpy View Post
 

 

At least Beats is an extremely successful company, making extremely successful, high margin, mainstream products that will pay for itself in no time. 

 

I play videogames, and have never used or had any motivation to use this twitch service. Sounds like a super-niche service that's ridiculously overvalued. 


Twitch has great content. It's completely replaced my desire to watch TV, I just watch streams nowadays.

 

It's really interesting to watch people play, learn tactics and the chat is hilarious.

post #10 of 45

TWITCH is the perfect way to describe what Amazon investors do when they hear about another Jeff Bezos/Amazon acquisition.

 

If I were to attend a shareholder meeting, I'd be first in line at the microphone to ask Jeff "Ummmmm, so which decade should we expect to see an appreciable, steady Amazon profit and do you foresee your P/E ever dipping below triple digits?"

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post #11 of 45
Quote:
Originally Posted by Dickprinter View Post
 

TWITCH is the perfect way to describe what Amazon investors do when they hear about another Jeff Bezos/Amazon acquisition.

 

If I were to attend a shareholder meeting, I'd be first in line at the microphone to ask Jeff "Ummmmm, so which decade should we expect to see an appreciable, steady Amazon profit and do you foresee your P/E ever dipping below triple digits?"

 

I cannot wait for Amazon's stock to adjust to reality. That day will come and I doubt it will be to the upside. ;)

post #12 of 45

Caution: Pushing too hard can lead to hemorrhoids.

post #13 of 45
Great BUY!!! unlike STIPID BEATS!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!

I HATE DR DRE!!!!!!!!!!!

APPLE IS DOOOOMED!!!!!!!

TIM COOK!!!!!!!
post #14 of 45
Quote:
Originally Posted by Phone-UI-Guy View Post
 

 

I cannot wait for Amazon's stock to adjust to reality. That day will come and I doubt it will be to the upside. ;)

 

Bezos worked on Wall Street and he knows exactly how the game is played. He uses the madness to his advantage.

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post #15 of 45
You have added just a quotation mark too much within the link to amazon, this results in a 404 at techcrunch.
post #16 of 45
Whether "Twitch" is a good company or not, paying a billion in cash for a company that caters to under-maturated jobless basement-dwellers doesn't seem like a purchase that will end well.
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post #17 of 45
Quote:
Originally Posted by Macky the Macky View Post

Whether "Twitch" is a good company or not, paying a billion in cash for a company that caters to under-maturated jobless basement-dwellers doesn't seem like a purchase that will end well.

 

It's a good move for Amazon and one that will get more people to try their streaming movies service. THE most popular channels on YouTube are those featuring video game play. They get millions of hits... more than broadcast television!

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post #18 of 45
At least Google didn't buy them...thats all I can say.

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post #19 of 45
Quote:
Originally Posted by Macky the Macky View Post

Whether "Twitch" is a good company or not, paying a billion in cash for a company that caters to under-maturated jobless basement-dwellers doesn't seem like a purchase that will end well.

 

This post suggests that you don't understand how massive and profitable the gaming industry is.  Gamers definitely have money they're not afraid to spend it.

post #20 of 45
Quote:
Originally Posted by SpamSandwich View Post
 

 

Apple paid much more for Beats. $3 billion. Twitch.TV actually would've been a perfect fit for Apple TV.


Doubtful. I love Apple but it's not known for gaming.

post #21 of 45
Quote:
Originally Posted by Macky the Macky View Post

Whether "Twitch" is a good company or not, paying a billion in cash for a company that caters to under-maturated jobless basement-dwellers doesn't seem like a purchase that will end well.


That is really one of the most ignorant & asinine statements I've ever read here and I've read quite a lot.

 

Way to denigrate and generalize an entire segment of the population.

post #22 of 45
Quote:
Originally Posted by SpamSandwich View Post
 

 

Apple paid much more for Beats. $3 billion. Twitch.TV actually would've been a perfect fit for Apple TV.

I knew that. I just couldn't count this morning. :-)

post #23 of 45
Quote:
Originally Posted by Lord Amhran View Post
 


Doubtful. I love Apple but it's not known for gaming.

Not in the past, no. With the new A-series processors and metal API, it can and probably will be with future iterations.

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post #24 of 45
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Originally Posted by Cpsro View Post
 

Caution: Pushing too hard can lead to hemorrhoids.

 

 

At the very least it will give you a droopy eye.


Edited by MidwestAppleFan - 8/25/14 at 5:01pm
post #25 of 45

 

Quote:
Originally Posted by Lord Amhran View Post
 


That is really one of the most ignorant & asinine statements I've ever read here and I've read quite a lot.

 

Way to denigrate and generalize an entire segment of the population.

Wow, those under-maturated jobless basement-dwellers are awfully hypersensitive folks, and not too bright.  I'm not sure this group of fast-twitch Monster drinking red-eye trilobites can be called an entire segment of the population.  They barely register as a blip on the Relevance-to-Society meter.  Buying GameStop would have made more sense.

 

 

post #26 of 45

Viewers who watched this video also shopped for

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post #27 of 45
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Originally Posted by cali View Post

Great BUY!!! unlike STIPID BEATS!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!

I HATE DR DRE!!!!!!!!!!!

APPLE IS DOOOOMED!!!!!!!

TIM COOK!!!!!!!

 

Yeah, I miss drblank too :p

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post #28 of 45

Wait til they raises prices.

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post #29 of 45
Quote:
Originally Posted by MidwestAppleFan View Post
 

 

Wow, those under-maturated jobless basement-dwellers are awfully hypersensitive folks, and not too bright.  I'm not sure this group of fast-twitch Monster drinking red-eye trilobites can be called an entire segment of the population.  They barely register as a blip on the Relevance-to-Society meter.  Buying GameStop would have made more sense.

 

 


Congrats. You've also shown your complete ignorance of reality. Yes, a group of people that contributed $25 BILLION to the US Economy in Fiscal 2011 "barely registers on the relevance to society meter".

post #30 of 45
Originally Posted by MidwestAppleFan View Post

Wow, those under-maturated jobless basement-dwellers are awfully hypersensitive folks, and not too bright.  I'm not sure this group of fast-twitch Monster drinking red-eye trilobites can be called an entire segment of the population.  They barely register as a blip on the Relevance-to-Society meter.  Buying GameStop would have made more sense.

 

Did a video game kill your parents, or are you just pretending to be too stupid to realize that everyone plays them?

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post #31 of 45
Had Apple paid this much they would have been scrutinized and mocked.

As far as "basement-dwellers", I think he's talking about those 12-year-old H@rdc0r3 gamerZ who play Xbox and call anyone who likes Nintendo "kiddiez".
I hate those bastards too...
post #32 of 45
Good god! When are the Amazon shareholders going to wake up? Talk about fragmentation and lack of focus.... In other news, Amazon acquires a chain of electronically operated car washes as well as a chain of online dry cleaners...
post #33 of 45
Quote:
Originally Posted by MazeCookie View Post


Twitch has great content. It's completely replaced my desire to watch TV, I just watch streams nowadays.

It's really interesting to watch people play, learn tactics and the chat is hilarious.

Wow! I think it's time to get a life, unless you were missing the /s
post #34 of 45
Quote:
Originally Posted by Lord Amhran View Post
 


That is really one of the most ignorant & asinine statements I've ever read here and I've read quite a lot.

 

Way to denigrate and generalize an entire segment of the population.

 

Quote:
Originally Posted by Lord Amhran View Post
 


Congrats. You've also shown your complete ignorance of reality. Yes, a group of people that contributed $25 BILLION to the US Economy in Fiscal 2011 "barely registers on the relevance to society meter".

 

Quote:
Originally Posted by Lord Amhran View Post
 


Congrats. You've also shown your complete ignorance of reality. Yes, a group of people that contributed $25 BILLION to the US Economy in Fiscal 2011 "barely registers on the relevance to society meter".


That $25 Billion is about 1.4% of the total US Economic Output.   It does in fact barely register and Amazon dumped a ton of money into a small sliver of that market.  That's what happens when you play too many games.  You start doing stupid stuff like spending a billion on an online company that almost no one has heard of.


Edited by MidwestAppleFan - 8/25/14 at 8:02pm
post #35 of 45

This is actually clever. Amazon is going for teens and early 20's to raise brand awareness and increase sales for themselves now, but especially when these kids will grow up and will have their own paychecks and are used to see Amazon ads everywhere. Amazon didn't buy Twitch for what they are, but to secure a future customer base. Clever move Bezos, but I still don't buy your crap.

post #36 of 45
Quote:
Originally Posted by cali View Post

Great BUY!!! unlike STIPID BEATS!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!

I HATE DR DRE!!!!!!!!!!!

APPLE IS DOOOOMED!!!!!!!

TIM COOK!!!!!!!

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post #37 of 45
55 million users is small relative to the likes of Youtube that boasts 1 billion users:

http://uk.reuters.com/article/2013/03/21/us-youtube-users-idUSBRE92K03O20130321

but they can expand twitch to become a Youtube rival if they wanted to. They could potentially use it for a kind of Facetime service to rival Google Hangouts, I think twitch has been used for live conferencing but game related. They can also advertise Amazon content more e.g sell games to gamers.

Some of these purchases are reminiscent of the dot-com era when things like this happened:

http://en.wikipedia.org/wiki/Broadcast.com

where a bunch of guys started an internet radio company and sold it onto Yahoo for billions and had 0.5m users. It didn't really amount to anything in the end, people don't really listen to radio online. I guess internet video killed the internet radio star but the founders made off with the money anyway. It always has to happen eventually where someone pays more than something is worth.

I don't think gaming will die out as quickly and streaming integration with the consoles will give it a further boost. Let's not forget the classic moments to be had from streaming (40 million views on the video):

post #38 of 45
Quote:
Originally Posted by Marvin View Post

55 million users is small relative to the likes of Youtube that boasts 1 billion users:

http://uk.reuters.com/article/2013/03/21/us-youtube-users-idUSBRE92K03O20130321

but they can expand twitch to become a Youtube rival if they wanted to. They could potentially use it for a kind of Facetime service to rival Google Hangouts, I think twitch has been used for live conferencing but game related. They can also advertise Amazon content more e.g sell games to gamers.

Some of these purchases are reminiscent of the dot-com era when things like this happened:

http://en.wikipedia.org/wiki/Broadcast.com

where a bunch of guys started an internet radio company and sold it onto Yahoo for billions and had 0.5m users. It didn't really amount to anything in the end, people don't really listen to radio online. I guess internet video killed the internet radio star but the founders made off with the money anyway. It always has to happen eventually where someone pays more than something is worth.

I don't think gaming will die out as quickly and streaming integration with the consoles will give it a further boost. Let's not forget the classic moments to be had from streaming (40 million views on the video):


55 million viewers for a very profitable niche is arguably much better than a wildly diverse 1 billion viewers with few common characteristics.

http://en.m.wikipedia.org/wiki/List_of_most_watched_television_broadcasts_in_America

Compare 55 million hardcore viewers to the top viewed broadcast television programs.

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post #39 of 45
Quote:
Originally Posted by SpamSandwich View Post

Unexpected. Way to spend all that extra money, Jeff... wait a sec...

My first though too ROFL
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post #40 of 45
Quote:
Originally Posted by Marvin View Post

55 million users is small relative to the likes of Youtube that boasts 1 billion users:

http://uk.reuters.com/article/2013/03/21/us-youtube-users-idUSBRE92K03O20130321

but they can expand twitch to become a Youtube rival if they wanted to. They could potentially use it for a kind of Facetime service to rival Google Hangouts, I think twitch has been used for live conferencing but game related. They can also advertise Amazon content more e.g sell games to gamers.

Some of these purchases are reminiscent of the dot-com era when things like this happened:

http://en.wikipedia.org/wiki/Broadcast.com

where a bunch of guys started an internet radio company and sold it onto Yahoo for billions and had 0.5m users. It didn't really amount to anything in the end, people don't really listen to radio online. I guess internet video killed the internet radio star but the founders made off with the money anyway. It always has to happen eventually where someone pays more than something is worth.

I don't think gaming will die out as quickly and streaming integration with the consoles will give it a further boost. Let's not forget the classic moments to be had from streaming (40 million views on the video):


I know Amazon has outbound streaming but do they have uploading too?
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