As it steps its efforts to establish itself in the gaming business, Netflix is establishing its own video game studio.
Marko Lastikka, a former executive at Zynga and Electronic Arts, will serve as its CEO and it will be based in Helsinki, Finland.
Small game businesses like Night School Studio, the developer of Oxenfree, were previously acquired by Netflix.
But the king of streaming is now going much further and starting from scratch with a studio.
Lastikka is a well-known name in the game industry. He co-founded the Helsinki-based Zynga company, which produced FarmVille 3 under his direction.
The “goal to develop a world-class games studio” was stated in a blog post by Amir Rahimi, VP of Game Studios at Netflix.
With no commercials or in-app purchases, “[it] will deliver a variety of wonderful and intensely engrossing creative games.”
Netflix reported a 200,000 subscriber decline in April, its first quarterly loss since 2011.
Its 35% share price decline reduced the firm’s market worth by more than $50 billion (£46.5 billion).
The biggest subscriber loss in Netflix ever occurred between April and July 2022, although the company still has more than 220 million subscribers globally.
Why Helsinki?
In March 2022, Netflix acquired Helsinki-based Next Games.
It already has a working relationship with the game designer who created a mobile game inspired by the popular Stranger Things Netflix series.
Michael Verdu, the vice president of games at Netflix, at the time referred to Next Games as “a core studio in a strategic region and key talent market.”
Helsinki-based game researcher Annakaisa Kultima told the BBC that this purchase would have influenced Netflix’s choice.
They are familiar with Helsinki’s operations as well as Finland’s development culture, she continued.
“Every day, hundreds of games are released on the app stores; as a result, you must possess the necessary skills to stand out from the competition.
“Games are not marked with the location of their production, despite the fact that we have a reputation for doing rather well for the past decade or two.
From that vantage point, I believe the explanation is that they are aware of the talent that is situated in Finland, where [Clash of Clans developer] Supercell, [Angry Birds developer] Rovio Entertainment, and [Control developer] Remedy Entertainment are located in the neighboring city of Espoo.
Just for mobile?
In recent years, Netflix has become increasingly interested in the gaming sector.
It has released a number of video game-themed series, including Cyberpunk: Edgerunners and Arcane (based on League of Legends) (based on Cyberpunk: 2077).
Together, Netflix and Ubisoft will create a live-action Assassin’s Creed television series as well as a mobile game that will only be available on Netflix.
It’s not known if the Netflix gaming company plans to create games only for mobile devices or if it will also pursue the home console market.
Independent industry expert Eric Seufert believes Netflix is investing “quite substantially” in the gaming sector.
“They have a ton of information on consumer preferences for video streaming content, so my impression is that they can use some of it.
I believe that their ultimate goal is to use these games as a component of the product content bundle and then integrate them into the Netflix world.