Youtube X Action Blizzard, a new opportunity for traditional streaming media to compete in the electric race
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Wen/Mercury Lamp Leaving the safe haven of the game's live-streaming platform and coming to the traditional streaming field of action-watching blizzard competition to start a new survival.
Last week, Momentum Blizzard reported fourth-quarter 2019 results that showed revenue of $1,986 million, beating analysts' expectations of $1,812 million and falling 17 percent from $2,381 million a year earlier. Net profit was $525 million, down 23 percent from $685 million a year earlier.In fiscal 2019, Action Blizzard revenue was $6.468 billion, down from $7.5 billion the previous year. In the fourth quarter, Activis Blizzard's breakthrough was largely due to the release of Call of Duty: Modern Warfare, which generated $600 million in revenue in three days, driving Q4 Blizzard's revenue higher than analysts expected.The momentum was partially successful, and at the revenue level it was Blizzard that dragged its feet. Blizzard's full-year revenue fell by $570 million compared to 2018, Blizzard didn't release any new IP productions in 2019, and Warcraft 3: Reboo was snared by players when it hit the market, making it a lower-scoring game on major scoring sites.OWL, Blizzard's electric competition benchmark, is facing the expiration of its live-streaming contract with Twitch for a third season. At the end of January, Momentum Blizzard announced that its OWL, Furnace Rock, COD and other leagues would leave Twitch for YouTube. Blizzard, under pressure from revenue, urgently needs to prove itself with new initiatives, leaving the safe haven of the game's live-streaming platform, and Moving Blizzard is looking to traditional streaming media, where e-sports have been given another opportunity of the times. 1 Business strategy overlaps as the key to "traditional streaming X-Ray" It's not just Blizzard that's under pressure from revenue, but in recent years, Google, which is focusing on its advertising business, is facing a series of threats, including antitrust investigations and competitors eroding its advertising business. Last week, Alphabet, Google's parent company, reported its 2019 results. As part of the report, YouTube's revenue was disclosed for the first time in its earnings: it generated $15.2 billion in advertising revenue in 2019, up 36 percent from $11.2 billion a year earlier.Although that revenue was nine times more than Google spent on Youtube in 2016 ($1.65 billion). But that doesn't mean Google's investment in Youtube is making ends meet or making a profit. Alphabet and Google's CFO Ruth Porat said on a earnings conference call that they paid the vast majority of their revenue to video creators. CEO Sundar Pichai said on a conference call that he believes youtube has "a lot of room" to generate revenue from its users.Alphabet CEO Sundar PichaiThe vague answer clearly does not satisfy investors. Alphabet reported fourth-quarter operating profit of $9.3 billion, well below consensus market expectations of $9.9 billion. FactSet, the financial data provider, said it was alphabet's 9th under-expected operating profit in the past 10 quarters. Alphabet shares fell nearly 5 percent after the results were released.As the world's leading streaming site, Youtube's revenue resultsIt was first disclosed in the earnings report，Show.Youtube's revenue will be Google's next development priority after its earnings are transparentOne of the markets worth expanding into is eSports. According to Tobias Seck, an overseas journalist,Only about 7% of Youtube's hourly playback data is related to video games.The OWL, which is owned by Action Blizzard, is close to the traditional sports league model in the electric competition. In traditional sports leagues, more than 50 per cent of revenue comes from media rights, which are usually paid for by broadcasters, who derive mainly from advertising revenue and channel subscription fees. For the future ecosystem of e-sports, the revenue model of traditional sports, especially media copyright, may become the focus of e-sports development.Streaming media with advertising as the core of revenue overlaps with sports e-competition.In its revenue statement, Youtube said advertising and subscription revenue could be used to purchase media rights. Shortly before the earnings disclosure, the exclusive rights to leagues such as OWL, which is owned by Action Blizzard, were bought by Youtube.At the other end of the Pacific, Bilibili, known overseas as "China Youtube," has taken an earlier step into the field of e-sports rights, and in 2019 Station B will buy the rights to S-Series for the next three years, from broadcasting events such as LPL, Dota Major and OWL. Another traditional streaming fastman has also shown a keen interest in e-sports by buying the S9 rights. It is no accident that traditional streaming media have bought the exclusive rights to the electric competition in the world, which is more like a symbol of the time for the competition to move out of the traditional game platform and into the traditional streaming media. 2 Electric.The pain and prospect of entering the traditional streaming media As mentioned earlier, only 7% of Youtube's playback time is related to the game's e-competition. On the one hand, this is the big e-competition prospect that the $10 billion market has brought to The View Blizzard, and on the other hand, it means that the video game does not have a market base like China's Bilibili on Youtube, and the foundation needs To see Blizzard develop itself, and the exclusive rights will be the main pain.During the transition from Action Blizzard to Youtube, the loss of OWL's Twitch platform, Blizzard's video game viewing data plummeted. Over the past week, Watchman, Furnace Stone legends and Call of Duty have all dropped out of the top 10, according to Sports Charts, with only MMORPG's World of Warcraft still in the top 10.The popularity of a game in Twitch is about equal to its overall popularity in overseas markets. Last year, Twitch accounted for 73 per cent of the overseas live game market, three times ahead of YouTube, according to StreamElements. And after The View Blizzard and Twitch's broadcast contract expired, there are overseas e-sports reporters revealed that Twitch side refused to pay a high price to renew the OWL league contract, so that Action Blizzard sought to work with Youtube.Youtube has not disclosed a broadcast contract with Action Blizzard, but it has cut its earnings forecast to see that the contract should not be much more than Twitch's $90 million over 18 years. One visible figure is that the Watchman League playoffs attracted 318,000 overseas viewers during last year's rush hour, with an average of 110,000 viewers per hour. Furnace Stone Legends, Call of Duty watch data is lower.Perhaps that's why Momentum Blizzard has had to switch its technology to traditional streaming.Jump out of an already saturated live gaming platform and start again in a much larger market of 10 billion.While Youtube is still not cold on e-racing, it's worth noting that the record 1.2 million viewers at the 2019 Free Fire World Series, which averages a high number of viewers overseas, surpassed the 1.1 million at the Fortress Night World Cup and the 1 million at the League of Heroes S9.We intercepted youtube game channel data. At 14:00 BST on February 11th, the highest-watched Free Fire had 31,000 viewers watching at the same time. Ark Survival Evolution is a game released in 2015, and the Japanese virtual host, who is based on Youtube, recently set the old game on fire again, with the top five channels currently featuring virtual host channels. Meanwhile, Twitch's popular category is League of Heroes, which has about 140,000 viewers, more than the top five youtube live games all make.Activis Blizzard's home-country competition brand, OWL, received 1.04 million viewers on the second day of the new season on channels in English, French and Korean.The results are no less than their own performance during the Twitch period.Youtube has also succeeded in bringing in a new audience through OWL, and since Free Fire's success last year, Action Blizzard may be the second biggest hit in YouTube." And Momento Blizzard has seized new opportunities from live gaming platforms to traditional streaming media, and how big this 7% cake will be will be a problem that Action Blizzard and YouTube are working together to face. Conclusion: Starting with Twitch's $90 million contract and moving to traditional streaming youtube at the end of the contract, OWL, along with the entire Action Blizzard competition, has entered a new $10 billion market. How much cake can be made depends on YouTube and Activis Blizzard's verses, as well as ambition.Under pressure from revenue, Action Blizzard had to change, and YouTube had to change, jumping out of their comfort zones and integrating a "traditional streaming X-Ray" ring. The resources and advertising value of traditional streaming media are another opportunity for e-sports in the new era, leaving the traditional game broadcast platform, I believe that the results of The View Blizzard's solo broadcast rights bet will be seen in next season's earnings. 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