What Microsoft’s Decision to Shut Down Mixer Means for the Gaming Industry
And what it means for brands looking to enter the gaming space
On Monday, Microsoft made an unexpected announcement that its live-streaming service Mixer will shut down on July 22, citing an inability to achieve scale goals as the primary reason for bowing out of the game-streaming arena.
“The success of Partners and streamers on Mixer is dependent on our ability to scale the service for them as quickly and broadly as possible,” said Xbox head Phil Spencer. “It became clear that the time needed to grow our own live-streaming community to scale was out of measure with the vision and experiences we want to deliver to gamers now, so we’ve decided to close the operations side of Mixer and help the community transition to a new platform.”
Stagnant Growth Led to Mixer’s Demise
The shocking announcement came off the heels of what was supposed to be a breakout year for Mixer, with many pundits anointing it a legitimate contender after last summer’s splashy talent signings of Tyler ‘Ninja’ Blevins and Michael ‘Shroud’ Grzesiek.
Despite its ability to lure high-profile content creators away from their old homes, Mixer failed spectacularly in trying to replicate that same success with viewers. While marquee talent brought hardcore loyalists with them to the platform, their viewership waned drastically after the switch. According to DOT Esports, Ninja’s average viewership dropped 33% about six months after moving to Mixer.
Mixer’s talent is not to blame for its downfall though. What proved to be the death knell for the platform was its inability to build a unique community identity that attracted users away from other live-streaming platforms and kept them engaged on Mixer.
What proved to be the death knell for the platform was its inability to build a unique community identity that attracted users away from other platforms.
It was not so much a precipitous decline that led to Mixer’s demise as it was stagnant growth. Between April 2019 and April 2020, Mixer’s total hours watched grew from 37.044 million to just 37.106 million, a paltry 0.2% YoY growth, despite Microsoft’s significant investment. Compare those numbers with those of their chief rivals Twitch (101%), YouTube (65%) and Facebook Gaming (238%) and Spencer’s words about scale expectations resonate.
The Fallout: The Fight for Talent Continues
Though July 22nd will mark Mixer creator’s swan song on the platform, streamers are encouraged to move over to Facebook Gaming as part of a new partnership between Microsoft and the social media behemoth. Facebook Gaming will honor partnership status for those making the jump from Mixer, meaning those who were previously able to monetize their stream on Mixer will have access to Facebook’s Level Up Program which enables them to do the same. In addition, FB Gaming has pledged to provide all Mixer Partners with a $2,500 dollar stipend to help entice and mitigate some of the potential hardships of the move.
Though this new partnership will seemingly ease the burden of switching platforms for the over 4 million creators that call Mixer home, it’s far from a foregone conclusion that all will do so.
According to esports consultant and insider Rod Breslau, Facebook offered Ninja and Shroud “an insane offer at almost double the original Mixer contract,” but ultimately both declined and collected handsome payouts as a result of their exit. While Mixer’s former one-two punch should have little trouble building their audiences back up wherever they may land, this brings the streaming exclusivity conversation back to the forefront.
Mixer shutting down brings the streaming exclusivity conversation back to the forefront.
Mixer’s Ninja signing last August catalyzed a talent chain reaction across the streaming landscape, with platforms competing to secure other major players like Jack ‘CourageJD’ Dunlop and Jeremy ‘DisguisedToast’ Wang, who moved to YouTube and Facebook Gaming, respectively. Facebook’s audacious bid for Ninja and Shroud proves there is still appetite from challengers like Facebook Gaming and YouTube to secure those types of talents for the right price, but the prompt “no” they received from both creators points towards more lucrative monetization opportunities elsewhere.
Over the course of the last year, Twitch has negotiated exclusivity deals with premiere talent like Ben ‘DrLupo’ Lupo and Tim ‘TimTheTatMan’ Betar to ensure they’re entire roster of stars didn’t depart, but Mixer’s fall has shifted the power dynamic back in favor of the Amazon property. As the distinguished leader in the space, boasting the most creators, viewers, subscribers of any platform, Twitch may not have to break the bank on exclusivity deals to draw talent back in. The day-to-day monetization opportunities on Twitch far exceed that of its rivals. Most notably, Twitch users with Amazon Prime can subscribe to one channel for free each month — netting the creators $2.50 per subscription. For someone like Ninja, who had as many as 121K subscribers on Twitch, that equates to some serious cash money. The lucrative monetization opportunities coupled with an established, engaged user base makes Twitch a very appealing option, especially for creators who previously plied their trade there.
Understandably, most of the conversations around content creators is focused on the celebrity type, but Mixer’s decision to power down has also left four million plus creators in a quandary. Moving to a new platform is easy, but doing so without losing a chunk of your audience is a nigh-impossible task. Something as simple as having to learn how to navigate a new interface may be enough to discourage some viewers from migrating with you, leaving smaller creators sleeplessly calculating and contemplating the significance of their next move.
While the superior monetization prospects make Twitch an attractive option for creators looking to make the switch, there are a multitude of other factors that will surely play a role in the decision. Shortly after departing the Amazon entity, Ninja cited his frustrations with the platform, saying he wanted “a little bit more freedom”. Absolute creative control is what enables these influencers to distinguish themselves from that of their peers and an overly hands-on approach from Twitch may discourage creators looking to build their own brand on their own terms. The “Twitchover” has also yielded some legitimate concerns over sexism, racism and sexual harassment, complicating the decision for Mixer creators looking for a new home.
While the superior monetization prospects make Twitch an attractive option for Mixer creators, there are a multitude of other factors that will play a role in the decision .
“I don’t feel safe, so that’s my number one concern,” said Mixer variety streamer ChicaDeAwesome, “I feel like that Twitch ain’t home to me, I don’t wanna go to Twitch.”
Twitch CEO Emmet Shear has said the company is investigating a number of sexual harassment and assault allegations against Twitch affiliates and has pledged to ban or remove those involved from the platform.
While switching to Twitch may prove difficult for some given the companies track record in dealing with matters of discrimination, there are equal concerns about joining Facebook. The number one issue that seems to be keeping Mixer creators away is the company’s history with data privacy.
“Facebook is archaic,” says Mixer partner DM21Constellation. “Their desire for all the data from their users is absolutely absurd.”
In addition to the heightened fears around data collection, Facebook’s interface is “too personal” for others with the lack of anonymity for both creators and users enough to keep some Mixer talents away.
If both Twitch and Facebook are unable to assuage the fears Mixer creators have about successfully bringing their brand to the platforms, other platforms like YouTube, Caffeine and Tencent’s Trovo.Live (currently in public beta), stand to benefit the most.
Given the various factors at play, the next month will be a pivotal period in realizing these platform’s future ambitions. Whoever manages to carve out the biggest piece of the Mixer pie is sure to emerge with some serious momentum heading into one of the biggest holiday seasons for gaming in recent memory.
The Cloud Gaming Platform War, Rejuvenated & Uncertain
Speaking of the holidays, Xbox’s fourth-generation console, the Xbox Series X is slated for a late 2020 launch and Monday’s Facebook partnership announcement could mean that Facebook Gaming replaces Mixer as the console’s primary streaming platform. While no official announcements have been made regarding the level of integration between Xbox Series X and Facebook Gaming, it would be surprising for Xbox to launch without the backing power of a streaming service, putting them at a tremendous disadvantage against PS5 who’s share functionality is powered by Twitch.
While the implications for the next-gen consoles hangs in the balance, one concrete detail that emerged from the Facebook partnership announcement is the collaborative development of Microsoft’s Project xCloud gaming service. Project xCloud shares the same vision as Google’s Stadia and Nvidia’s GeForce NOW, a lightweight, accessible gaming experience for those without the funds to splash on a console or computer.
“Imagine a scenario where people can instantly move from watching a Facebook Gaming creator’s livestream to jumping in and playing the game with their closest friends, all in one click,” said Vivek Sharma, VP and Head of Facebook Gaming. “Enabling technology such as Project xCloud to power new types of gaming experiences is one part of our longer-term vision for people to discover and play games instantly on Facebook.”
In theory, Project xCloud and cloud-based gaming is a fantastic solution that will afford more users the ability to play sans expensive hardware, but in practice, the technology has yet to be perfected. The smallest amount of latency can make or break a gaming experience and without the requisite bandwidth, users are subjected to lag and low-quality rendered environments which compromises the integrity of the experience.
User adoption of cloud-based gaming solutions is moving at a snail’s pace as a result of its imperfections, with Google’s Stadia selling less than 200,000 units in a calendar year. Google’s ambitions for the cloud-based gaming Stadia are akin to that of plans for Project xCloud. Microsoft’s partnership with Facebook will enable them to lean into the 2 billion monthly active users on the social platform to help drive users for Project xCloud. Similarly, Google is backed by the strength YouTube — which also touts 2 billion monthly users — to help build drive adoption and create an integrated hybrid discovery/play experience.
Google’s ambitions for the cloud-based gaming Stadia are akin to that of plans for Project xCloud.
Perhaps Microsoft’s technical nous and Facebook’s unrivaled scale will enable them to unlock the true power of cloud-based gaming, and subsequently blur the lines between discovery and playing, but don’t expect any official announcements until at least holiday 2020 on future prospects.
One thing that could ultimately shorten the timeline on the rollout of Project xCloud is the status of ‘Project Tempo’, Amazon’s own cloud-based gaming endeavor. While details remain scarce on Project Tempo at the moment, it’s clear Amazon is looking to consolidate its powerful position in the streaming realm as owners of Twitch with the gameplay side of matters with Project Tempo. If Amazon manages to develop a comparable quality product to that of its competitors, the direct Twitch integration will surely propel it to the ascendancy of the streaming/cloud-based gaming landscape.
Promises of playable ad units on stream (both PC and Mobile based), one-click to play and dropping into lobbies with your favorite streamers are still a long way from being fulfilled, but the first to unlock those features and functionalities surely stand an advantage in capturing market share.
Something unmentioned in Monday’s announcement were future implications for the partnership between Facebook and Microsoft. While seemingly this alliance was forged with gaming in mind, this could mark the beginning of a tremendously fruitful partnership between the two conglomerates.
Now that Mixer has seen — to borrow an Xbox term — the red ring of death, its four million plus content creators are left with a difficult decision about their future streaming prospects.
We’ll see if recent developments aid challengers YouTube and Facebook Gaming in usurping the long-standing king of streaming Twitch, or if the Amazon entity will continue to tighten its grip on the space.