Though the YouTube (under Google) and Twitch deal is yet to be made official, reports from well known Wall Street-based business media houses are predicting that both companies are negotiating terms and conditions under closed doors and may confirm the news soon.
According to Variety, Google is ready to shell out $1 billion to acquire Twitch but the video game streaming website company is ironing out issues, such as branding and degree-of-autonomous from the search engine giant .
Who benefits more from this acquisition? Google or Twitch?
Though many perceive Google to benefit more from this deal by integrating more members from Twitch (approximately 45 Million active monthly users) to earn more revenue over time via advertisements, it has to be noted that the latter will also get the extra pocket money to expand infrastructure to accommodate the burgeoning user-base.
Currently Twitch is the fourth highest peak Internet traffic generator (more than Facebook and Amazon) in US. The viewership is rising like clockwork, even Twitch Vice-president (Marketing), Matt DiPietro admitted to The Verge, late last year, that the company is trying hard to keep up with the growth, but also glad to be in this position, which is enough to convince capitalists for raising funds. If merged with YouTube they can get access to huge funds to improve their assets.
It's a win-win situation for both internet players. The third benefactor will be the users. YouTube already provide live streaming services for sports (like IPL), on-demand, music, movies, sitcom contents like Netflix. And now with integration of Twitch, live video-games can be streamed and watched forming a big platform for fans to use YouTube as an all-in-one online entertainment service.
Will Twitch users accept the transition?
Twitch has huge gaming fans thanks to less restriction. Gamers can use catchy alias/monikers as their user-id and the platform is also a breeding ground for funny meme generation/witty comments often trolling fellow viewers with expletive language, which is a another major factor, why Twitch attract youths (according to statistics, average age of a Twitch subscriber is less than 25).
Once Twitch merges with YouTube, there is a possibility that Google may introduce some restrictions on personal identification or force users to certain sign up un-popular terms & conditions, leading to depletion of user-base. It remains to be seen if Google has any specific ad-hoc plans to keep the fans happy through the transition.
Hurdles for YouTube acquiring Twitch
With YouTube being the top video-streaming service on the internet, there is a strong possibility that the US government-owned FTC (Federal Trade Commission) may perceive the acquisition of a fast growing young company like Twitch as anti-competitive.
We saw similar things happening with Facebook and WhatsApp, when the former bought the mobile messaging service for a record $19 billion deal. Like Facebook, many optimists believe FTC is certain to give nod to YouTube to merge Twitch with the company sooner or later.
Previous bids on Twitch.tv
Prior to Google, Twitch was approached by many firms, with most prominent being Microsoft Corp, which wanted to integrate the live game streaming service to the company's flagship Xbox division to gain upper hand over rival Sony's PlayStation business but talks failed as Twitch backed off as the company had inclination towards YouTube (for unknown reasons), reported The Verge, citing a company insider.
Brief history of Twitch.tv
Twitch.tv, the popular e-sports-and-game streaming site is a brainchild of Justin Kan and Emmett Shear, who launched the niche service in June 2011. It initially began as a subsidiary of the duo's first online tryst Justin.tv (launched in 2007), which served as a platform to any individual to stream their personal videos on the internet.
Ever since the debut of Twitch in 2011, it has witnessed huge growth, compared to other big social network sites. In February, the company confirmed that the website's monthly active user base breached 45 million with 1 million active broadcasters, becoming the world's largest video gaming site.
Soon after scaling the magnanimous height, the company co-founders formally renamed the firm Justin.tv to Twitch Interactive, Inc a few months ago.