Up next for Netflix games efforts: Family game night

Since starting gaming efforts, Netflix has taken different approaches to incorporate games and interactivity into its platform, but it hasn’t yet become a significant business for the streamer. But the SVOD certainly isn’t giving up on what could be a lucrative gaming market and during fourth quarter 2024 earnings this week executives shared some plans for what’s up next, including cooperative games that families and friends can play together, delivered on the TV.

Netflix has already launched a long list of mobile games, including ones based on reality TV and other original IP, such as Too Hot to Handle, Emily in Paris and recently launched Squid Game Unleashed, and notably big-name licensed game IP with Grand Theft Auto.

Going forward it wants to further marry content and games to create experiences the whole household can get in on and engage with.

As Netflix reported adding nearly 19 million net subscribers in the final three months of 2024, Netflix co-CEO Greg Peters on Wednesday said streamer has learned quite a bit on the gaming front and continues to refine the strategy. It plans to introduce party and couch co-op games, served on the TV and delivered from the cloud, according to the co-CEO.

“We think of this as a successor to family board game night, or an evolution of what the game show on TV used to be,” Peters said during the streamer’s Q4 earnings call, without disclosing specifics or a timeline for when party-style games will debut. “We’re excited about delivering some cool experiences in that space.”

While he said games would be cloud-based and delivered through the TV, it wasn’t exactly clear what form the co-op games will take and what IP they’ll be tied to. Alongside mobile games, Netflix has previously tried efforts like a daily interactive trivia series and an interactive trivia game one could play alone or with a friend back in 2022. In 2023 it started testing out enabling gameplay on TVs using phones as a controller with titles like Oxenfree from its game studio Night School Studio. Separately, there are subtle signs of continued interest in classic game show-style content, such as the latest Jeopardy! spin-off series, Pop Culture Jeopardy! from Sony Pictures Entertainment hosted by SNL’s Colin Jost, that debuted on Amazon’s Prime Video last year. And while anecdotally it stands to reason that viewers like to play along with game shows at home as they watch, Netflix sounds to have bigger ambitions that potentially bring family game play and game shows from the TV screen into the living room in a more direct and interactive manner.

According to Peters, Netflix is currently only scratching the surface when it comes to games.

On the mobile game front, its release of a Grand Theft Auto drove tens of millions of downloads, he noted, adding it has fan favorites based on Netflix IP like Selling Sunset and its latest big release Squid Game Unleashed based on the hit Korean series, which Peters said is on pace to be the SVOD’s most-downloaded mobile game.

These validate Netflix’s game formula, the co-CEO continued, whereby there’s a “virtuous cycle between linear content and simultaneous game offerings” by not only extending engagement with the universe and storytelling but creating complementary experiences that reinforce both the interactive and non-interactive sides of the effort. In that regard, Netflix is going to focus on more narrative games based on series and films in the company’s catalog.

“These are consistent fan favorites and we’ve got a lot in the library to work with there,” he commented.

Plans call for a focus on “more recognizable mainstream titles,” with interest in both licensed (like GTA) and home-grown IP. And it intends to deliver games for kids, which Peters said would be safe space that’s included with a subscription and doesn’t serve advertising or offer in-app payments. 

Netflix is already seeing positive impacts on acquisition and retention from those subscribers that play Netflix games, per Peters, although he didn’t share any specific metrics.

The executive acknowledged those impacts are “relatively small currently” but was sure to point out that “so is our investment in games relative to our overall content budget.” Netflix plans to spend $18 billion in content this year, and he said intends to remain disciplined in scaling its games investment as it works to break into a new content category. 

The co-CEO sees plenty more to do and opportunity for games, where there’s a large and potentially lucrative market to tap into. According to Peters, games drive approximately $140 billion in consumer spend, excluding China and Russia and not including ad revenue.

“We’re iteratively showing our members that we are a place to discover and play games, and we look forward to continuing to launch bigger and bigger games every year,” he added.

Currently, Netflix offers games included with all subscriptions, with no ads or in-app purchase. But while Peters didn’t touch on in-game advertising, games are a place that advertisers want to be as consumers spend time.  A 2024 report from IAB found that game advertising was among the top three investment growth areas for U.S. marketers. Separate findings from eMarketer project in-game advertising revenue this year will grow 9.2% over 2024 to reach $9.39 billion in 2025 in the U.S. alone. And as mentioned, there’s potential consumer revenue streams, with half of U.S. adult mobile gamers spending more than $50 per year on mobile games, including in-app purchases, according to Civic Science..

Alongside deepening fandom and connection to TV and film series content, if they hit the mark, games could stand to help boost engagement with Netflix’s platform – a metric that Netflix CFO Spencer Neumann reiterated starts much of the cycle of success.

“Engagement, revenue, profit, it drives [the] flywheel,” he said.

Continued efforts on the games front come as Netflix reported 16% yoy revenue growth to reach $10.2 billion in Q4. It also sees games as a way to add value to the price of Netflix subscriptions, which as of Wednesday are going up. Alongside earnings results, the company disclosed price hikes across its subscription plans, including a $1 monthly bump to the ad-supported tier. 

Article timestamp updated to correct original publishing time.