December 15, 2014

Twitch to acquire GoodGame to bolster esports relationships

The rise of esports has given careers to countless professional video gamers, and created a market for innovative platforms for spectators and participants to engage with the technology. This week, Twitch, a game-streaming service, announced plans to purchase GoodGame. The acquisition will broaden Twitch's footprint in the esports market, which is already considerable: TechCrunch reports that daily, more users watch League of Legends than major network news broadcasts. 

GoodGame is described as a "full-service agency" that effectively pays gamers and game developers for their services. The company sponsors competitive video gaming teams and connects brands with third-party teams. The niche is an important component to monetizing an industry whose following grow every day, and GoodGame reports it's funneled more than $10 million to gamers, competitive teams and competitions. It also develops viral content for entities in the esports realm, where the name of the game is visibility. 

Twitch is a popular platform, but players are always looking for incentives to stay with a particular service. With streaming available on other sites, the acquisition of GoodGame could sweeten the pot for gamers to use Twitch. 

"With GoodGame on its team, Twitch can further ingratiate itself in the business of running teams and getting money to professional gamers," writes Kyle Russell of TechCrunch. "That in turn makes these popular streamers more likely to stick with Twitch when showing off their gaming chops, rather than jumping over to competitors like YouTube or Steam Broadcasting."

The bottom line of the merger is relationships: Twitch already has the technology to stream gaming as well as its competitors, but GoodGame offers a roster of brands and gamers the service can use to capitalize and cultivate loyalty among the esports community.