Streaming giant Netflix is planning to further diversify its business and earn new profits from its gaming business.

According to the Wall Street Journal, Netflix executives have been discussing how to generate revenue from games in recent months.

According to people familiar with the matter, some of the ideas Netflix management has discussed include internal purchases, charging for more complex games under development, or providing games with ads for users who buy cheap advertising packages.

If implemented, these measures would mark a major shift in Netflix's gaming business. The company has previously emphasized that it will not include in-app purchases or embedded ads in the game.

It is important to note that Netflix always publicly discusses corporate strategies, but this does not mean that decisions to monetize games will be implemented.

Netflix started getting involved in the game business a few years ago, but its games are mainly mini-games that keep up the life of popular dramas, mainly as a supplement to the series, which have the function of attracting fans and maintaining popularity, and all of these games are free to play.

At the moment, the number of users of Netflix games is still very small. According to Apptopia estimates, as of October, less than 1% of the total number of Netflix users played every day. According to Sensor Tower, Netflix's games were downloaded 81.2 million times globally last year, nearly tripling from 28.7 million in 2022. That's far less than the hundreds of millions of downloads from major game companies.

Over the past few years, Netflix has acquired a number of smaller game studios and started making more games focused on its own shows and movies. Its most popular original game “Too Hot to Handle: Love is A Game” was launched in December 2022 and has now been downloaded around 7 million times.

According to analysts' estimates, Netflix has spent about $1 billion to buy game studios and set up businesses. In contrast, the company spends about $17 billion on shows and movies every year.

However, according to recruitment information, Netflix is actively recruiting game executives, and one of the positions is to oversee the development of Netflix's first “3A masterpiece.” By convention, these games usually cost hundreds of millions of dollars to make.

In April of last year, Netflix Co-CEO Greg Peters said in an earnings call that he hopes to create a pure gaming experience for Netflix game players. He pointed out that the Netflix game design team only creates games from the perspective that players enjoy, and that designers don't need to consider monetizing games, whether advertising or internal purchases.

Wall Street News pointed out in a previous article that in the year of inflation, the cost of living for Americans was high, and streaming services have become increasingly difficult to retain customers. Many companies face tremendous pressure to reduce costs and increase efficiency. At the same time, they are also trying to reduce service prices and improve cost performance as much as possible to survive in the market. Although Netflix's business conditions are quite good compared to its competitors, it is also facing tremendous pressure to increase profits.

For example, Netflix had previously been unwilling to crack down on password sharing and launch a package with ads due to concerns about the consumer experience, but later reversed its attitude due to performance pressure.

Therefore, it would not be surprising if Netflix's gaming strategy also changes in the context of increased competition in streaming media.