The side of Microsoft’s Mixer move that no one is talking about
While news of Microsoft’s sale and closure of Mixer spread quickly, much of the discussion has focused on the reaction of Mixer streamers themselves. Many Mixer streamers who had dedicated years of their time and effort to the platform were left feeling deflated, confused and in need of a new plan. The pay day that Ninja and Shroud received when their contracts were brought out was a hot topic, as is Facebook Gaming itself. What no one is talking about however, is why Microsoft decided to move on from Mixer.
The thing that people need to understand about Microsoft is that they aren’t interested in doing anything on a small scale. When you think about the Microsoft business model, they think about world domination. They want their software and services on every device in the world. This is a company that came to be through Windows, after all. So while Mixer’s lack of growth is certainly the reason that Microsoft decided to get out of the live streaming space, it’s not because they weren’t the number one streaming platform.
While many people believed that Microsoft would simply hold out until Mixer grew, the reality is that Microsoft doesn’t have time to wait. Mixer wasn’t just a live streaming platform like most of the people on the platform view it. It wasn’t just a competitor to Twitch, YouTube Gaming, Facebook Gaming, Theta.TV, DLive, Caffeine.TV and Trovo.Live. Mixer was Microsoft’s window into the cloud gaming and all the business that comes with it.
If you’ve been paying attention to the live streaming and influencer space, you’ll know that cloud gaming is supposed to be the next “big thing.” The idea is that millions of new gamers will be engaged by removing the barrier of entry to gaming. Instead of having to drop hundreds of dollars to buy a high end gaming PC or gaming console, cloud gaming enables people on any device to click a link and instantly start playing games via their internet connection. The first serious example of this is none other than Google Stadia. While Stadia hasn’t exactly set the world on fire, it is a demonstration of the concept that is believed to be a big part of gaming’s future.
Twitch, the leader in the streaming space recently announced a brand new Pac-Man game that is made possible through this very concept. By viewing the new Pac-Man game on Twitch, you will be able to click a link and start playing the game in your browser, instantly, at no cost. Now extrapolate that concept to the newest Halo, Destiny, Call of Duty, World of WarCraft expansion or whatever you want. Publishers have various monetization options but the important thing is that nothing is required other than an internet browser to deliver these games and services to consumers. Don’t forget Twitch is owned by Amazon, who is Microsoft’s main competition in many endeavors.
Microsoft has been building its own cloud gaming service known as Project xCloud, which is currently in the testing phase. The reality is that Microsoft has been trying to grow Mixer so that it can profit from Project xCloud’s integration. Think of all of the new revenue that it could gain by enabling every viewer on Mixer to click a link and instantly start playing their latest games via the cloud. That was Microsoft’s plan. That’s why they fired a hail Mary and brought Ninja and Shroud over to Mixer. They needed more users on Mixer and they need them quickly. All those users are potential customers and a revenue source for cloud gaming. Project xCloud isn’t some crazy idea that’s a decade away. Cloud gaming is rapidly approaching and Google Stadia is already here.
Despite having impressive tech powering the Mixer platform, signing big name streamers to exclusivity deals and a user interface that’s a heck of a lot cleaner than competing platforms like Facebook Gaming and YouTube Gaming, Mixer just wasn’t putting up numbers. Analysis shows that even after signing Ninja, Shroud and an increase in people browsing live streams due to COVID-19 related quarantines, Mixer just hasn’t grown a significant way. We can try to pinpoint the cause of Mixer’s failure to grow but Microsoft really doesn’t think like that. They looked the Mixer situation directly in the face and said, our audience over here isn’t big enough to fulfill the goals that we have for cloud gaming. Facebook’s audience sure is though.
By selling Mixer to Facebook, not only does Microsoft recover some of their investment in Mixer, but they also secured a major partner for Project xCloud. When xCloud hits, anyone watching live streams on Facebook will be able to access games that are a part of Project xCloud and Microsoft gets them into the Xbox ecosystem. That gateway can lead to purchasing an Xbox Series X, Xbox software, Xbox Live, Xbox Game Pass, microtransactions and who knows what else. Microsoft even went so far as to say that they’re interested in exploring these same options with Instagram, which is also owned by Facebook. Do you see things lining up yet?
The fold of Mixer isn’t about the platform’s failure. Microsoft easily could have kept the platform going and it would have likely maintained the community that it had become known for. Mixer had a reputation of being a “nice” place to stream that was often free of drama and toxicity that haunts many other streaming platforms. But that simply isn’t important to a company as big as Microsoft. Microsoft builds businesses that are meant to connect with as many human beings as possible. As we learned with Windows Phone, Zune and now Mixer, if their effort fails to achieve that full fledged vision, Microsoft will simply shift strategy to achieve their goals.
The reality is that Microsoft’s partnership with Facebook will end up being more lucrative for their cloud gaming ambitions than pouring more money and effort into their own platform which had a limited audience. While I understand that this is a cold way of looking at Mixer’s death which has crushed a lot of streamers out there, it is the big picture move whether any of us like it or not. And in the opinion of this streamer, as well as Microsoft’s shareholders (Microsoft stock rose higher on this news), it was the right business move.
