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Google buys Twitch for $1 billion

Google purchases Twitch for $1 billion. Twitch allows gamers to broadcast their gameplay to millions of viewers.
Google purchases Twitch for $1 billion. Twitch allows gamers to broadcast their gameplay to millions of viewers.
Photo by Scott Olson/Getty Images

Google has finally got the deal done to buy Twitch, which is a videogame-broadcasting company. Variety reported that after a few months of negotiations, both parties came to an agreement where Google will buy Twitch for $1 billion.

Gamesbeat reported that Google’s YouTube division is in charge of the acquisition, which would help YouTube in a very positive way. Google acquired YouTube back in 2006 for $1.65 billion.

Twitch, which is based in San Francisco, enables people to broadcast their own gameplay sessions on XBOX One, Playstation 4 and PC to online viewers. It helps competitive and average gamers gain fame by entertaining spectators that could get up to the millions.

There are over 50 million active users on Twitch and more than 1.1 million members who broadcast videos each month. Twitch generates revenue from through ads as well as subscriptions. The company was created by the founders of Justin.tv, a website designed for users to “lifecast” themselves with online video. The reason Twitch was created is more videogamers began using Justin.tv to launch their gameplay and they launched Twitch in 2011.

With the addition of Twitch, YouTube could extend live-streaming to other categories, which include multichannel network partners such as Disney Maker Studios and Machinima. YouTube and Google wanted Twitch as part of the family because it proves that subscription-based video channels do work. Last year, YouTube launched a paid-channel initiative that included 30 partners. But since the launch, the channels have seen little to no action.

YouTube is the top platform for internet video, serving six billion hours of video per month to one billion users worldwide.

Back in March, it was reported that that it represented 1.35 percent of all downstream bandwidth of North American broadband networks during the primetime hours. YouTube represented 13.2 percent of all downstream bandwidth, but the biggest consumer was Netflix as they represented 34.2 percent of all traffic.