14 DAY TRIAL // It’s not just Amazon and Twitch that are happy about making things official between them, but also Twitch users and analysts.
Both Wedbush and Digi-Capital agree that the union is a good fit, writes Games Industry. In a letter sent out to investors, Michael Pachter, analyst at Wedbush, said that the acquisition “fits well with Amazon’s aggressive content strategy,” something that’s been pointed out by numerous media outlets.
He bases his opinion on the belief that Amazon spent over $1 billion (€758 million) last year for streaming video rights. Furthermore, Prime Instant Video, the Fire Phone, Fire TV and even Prime Music are evidence that the company wants nothing more than to be successful.
In the end, however, Amazon won’t be much better off following the purchase, at least not in a financial sense. Twitch’s estimated $30 million (€22.75 million) revenues throughout 2013 are great, but they’re nothing compared to the $74 billion (€56.1 billion) brought in by Amazon.
Digi-Capital has a similar opinion of the deal. Tim Merel, managing director with the financial firm, said that the deal was a good one, “Twitch is a great deal for Amazon beyond a competitive win, as it accelerates both its video and games initiatives. The $970 million (€735 million) deal pushes games M&A [mergers and acquisitions] to $9.2 billion (€6.98 billion) in 2014, closing in on double 2013’s full year record of $5.6 billion (€4.24 billion).”
Also, it seems that the total gaming tech mergers and acquisitions activity this year has reached $3.2 billion (€2.42 billion).
As you may already know, Amazon has purchased Twitch for $970 million in a twist of events that no one saw coming.
According to previous reports, Google had been quite close to sealing the deal with Twitch, with sources familiar with the deal saying that the two were in the last stages of negotiations, while others claimed the contract had already been signed.
The idea didn’t please many Twitch fans who promised to delete their accounts if the platform was purchased by Google and integrated into YouTube, since this seems to have been the plan.
Twitch took notice of the reaction to the leaked information and seems to have chosen to take a different direction and accept Amazon’s offer.
“We chose Amazon because they believe in our community, they share our values and long-term vision, and they want to help us get there faster. We’re keeping most everything the same: our office, our employees, our brand, and most importantly our independence. But with Amazon’s support we’ll have the resources to bring you an even better Twitch,” reads a message posted by Twitch CEO Emmett Shear.