INTERNATIONAL - Netflix has identified a big rival: the massively popular Fortnite.
The online shooter accounts for an enormous amount of consumers’ screen time, Netflix said in a shareholder letter last week, making it a formidable foe in the global war for internet users’ attention.
“We earn consumer screen time, both mobile and television, away from a very broad set of competitors,” Netflix said. “We compete with (and lose to) Fortnite more than HBO There are thousands of competitors in this highly fragmented market vying to entertain consumers.”
Netflix’s decision to name-check Fortnite reflects the game’s ever-growing popularity. It boasts more than 200million registered users, and some 80million log in to play each month, says publisher Epic Games.
Thanks to an engaging combination of reward mechanics, social communication and ease of entry - the game’s competitive mode is free to play - Fortnite soared to fresh heights last year, helping Epic earn a reported $3billion (R42bn) in profit.
Epic wants to translate that success into an even bigger opportunity to hook internet users, by building its own app and game store that undercuts the likes of Apple and Google.
For now, Netflix’s chief near-term threat remains other major TV content companies. As firms such as Disney pull their content off Netflix before launching their own exclusive streaming video apps, Netflix will face pressure to defend its subscriber base - the only way the company makes money.
In its earnings report on Thursday, Netflix said it added modestly to its audience, drawing 1.5million users in the US and 7.3million internationally.
But Netflix’s nod of respect to Fortnite is also a recognition of
how significantly Netflix’s horizons have expanded.
Ever since its humble days slinging DVDs to customers through the mail, Netflix has been a video company. Even now, as it pours billions into streaming content, it restricts itself to displaying films and TV shows.
But as it’s evolved, Netflix has also come to appreciate that there are only so many hours in the day, meaning only so much screen time consumers have to devote to entertainment.
That puts it on a collision course with other digital media: Not just YouTube or Hulu, but podcasts, blogs and, yes, video games.