In August 2014 Google announced a $1 billion acquisition offer for Twitch. Now it appears Amazon will be the one snapping up the live streaming video platform. Amazon is set to acquire the outstanding shares of the company for $970 million in cash by the end of 2014.
What is Twitch?
Twitch enables gamers to film themselves playing video games and then share that footage with Twitch’s audience. In mid 2013 Twitch was attracting 43 million viewers per month, making it one of the most visited websites on the internet. Twitch has become an integral part of the world of competitive gaming.
Why Is Twitch Selling To Amazon
Twitch CEO Emmett Shear is quoted as saying that he chose to sell to Amazon because:
“They believe in our community, they share our values and long-term vision, and they want to help us get there faster… with Amazon’s support we’ll have the resources to bring you an even better Twitch.”
Why Has Google Backed Out?
It appears the reason that Google decided to not complete their acquisition of Twitch was due to anti-trust issues. Both YouTube and Twitch dominate their respective markets and so there were concerns about the acquisition being blocked.
The Benefits For Amazon
The acquisition for Amazon gives the company exposure to the highly desirable millennial market. According to Boston Consulting Group the Millennial are on track to outnumber even the baby boomers. Because of the Millennial social media savvy, there impact as consumers extends beyond even their sheer purchasing powers. Using sites like Twitter, Facebook and Pinterest they are capable of sharing their opinions to a much wider audience.
This generation of consumers is particularly interested in online video. According to a recent study published in Adweek 34% of millennials prefer watching online video to broadcasted television shows. According to Videology CEO Scott Ferber:
“if advertisers want their online video campaigns to resonate, they should target a balanced media approach. That means using TV’s vast influence for the majority of demographic groups while also tapping into online video for specific younger targets.”
Why This Is Important For Your Business
Businesses that want to reach the younger millennial audience need to be pay attention to the way that content is being consumed. Video, and in particular mobile video, is an integral form of entertainment for younger consumers. This is a trend that is only likely to become more pronounced in the future.
One marked differences is that these consumers have much greater degree of control over the content they are exposed to. That’s why branded videos needs to genuinely engaging to be successful.
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