How the gaming industry has come full circle as a result of Live Streaming

By: Charlie Schanschieff

Gamers have been glued to their consoles ever since the NES was released in 1983. Unless you had a friend nearby, gaming was an immersive solo experience. The internet — and specifically the reduced latency afforded by broadband — took the social experience to the next level by connecting players remotely.

But much of the attention since has shifted — from playing to watching. Today video game live-streaming is a multi-billion-dollar industry. Many fans now choose to watch their favourite ‘streamers’ play rather than playing the games themselves.

Twitch, the pre-eminent streaming service, has led this change. Each month over 2.2 million Twitch creators broadcast their games live. With so many eyeballs, it’s no surprise that Amazon bought the service for $970m in 2014.

Curiously, for an activity that sounds passive, many users find Twitch a social experience — an opportunity to interact with, and learn from, their favourite gamers. And many Twitch fans also watch games live with their friends.

While Twitch has made lucrative careers for some streamers, the technology has continued to evolve. The next stage for streaming presents a revolution back in the gamer’s home, rather than online. Ultra-low latency networks allow all the computing hardware to run a game to be put into the cloud. The gamer’s side just has a screen (which receives gameplay images through the internet) and a controller. This eliminates nearly all the home-based hardware. And not just hardware: games of the future will be rented, not purchased. Gaming will become a service, both in hardware and software.

Why this is interesting to Kitchen8? It’s a fantastic example of two things: firstly how (in leading to Twitch) a technology’s evolution can unleash previously-unexpressed user needs. Secondly, how later developments can snowball beyond these kinds of changes to then redefine the commercial model of an entire industry.