Youtube in Possible Acquisition Talks of Twitch for $ 1 Billion

Google is reportedly in acquisition talks with increasingly popular live video-streaming platform Twitch. People familiar with the matter said that, Twitch has also considered additional fund raising as an option instead of selling. According to the entertainment magazine Variety, supposed price-tag of the deal is looming over $ 1 billion – all cash.

Image: Twitch TV

Image: Twitch TV

Twitch was launched in 2011 and is currently cited as one of the most popular live video-platform for live-streaming as well as watching videogame play. In September it has raised nearly $20 million from investors which included Thrive Capital and Take-Two Interactive Software a popular videogame-maker.

The deal if finalizes can help shoot up YouTube’s live-streaming service. YouTube has its own live-streaming platform for games, music, events and sports. However according to Qwit (online video & networking firm) , YouTube lags far behind Twitch TV which has obtained nearly 44% of U.S live-streaming traffic by volume ever since it was launched.

Twitch TV had more than 45million monthly unique visitors in February this year, which included one million who use the site to create and stream content. If seen from a completely different perspective, Twitch lags much behind Netflix and YouTube for all types of video streaming such as music, events and other sports for on-demand content.

PlayStation 4 supports Twitch streaming since its launch in 2011. Twitch was also integrated in Microsoft Xbox one very recently. Much credit of the new trend goes to enthusiastic gamers. Youtube has in fact tried to ward off competition since its launch, which is evident from its announcement of an API to let game developers to allow live streaming properties in their games.

According to Seth Bardelas, Head of agency development at TubeMogul, a video-advertising software firm, Twitch can sell ads at premium prices since viewers on Twitch can sit for hours watching live broadcast of other users playing games. It is something not entirely possible on Youtube since Youtube offers bite-size videos.

One of the biggest challenges that YouTube is currently facing is to find a feasibility to sell ads at premium prices.  YouTube has announced in April this year to rease at least 5% of ad space reserved for the best performing content on its channels for advertisers.

Microsoft and several other tech companies have approached Twitch for acquisition talks. It wouldn’t be a fair move for Twitch if it is a part of Microsoft since it is already embedded in its rival Sony PlayStation console.

Twitch is one of the most popular products that comes from Justin.Tv one of the streaming-video site that was founded in 2006 by Justin Kan and Kyle Vogt.

Anna Domanska
Anna Domanska is an Industry Leaders Magazine author possessing wide-range of knowledge for Business News. She is an avid reader and writer of Business and CEO Magazines and a rigorous follower of Business Leaders.

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