Microsoft (MSFT - Free Report) recently announced that it is set to close the operations side of its livestreaming gaming service — Mixer. Moreover, the company has teamed up with Facebook (FB - Free Report) to aid the Mixer community’s transition to Facebook Gaming.
Beginning Jul 22, Mixer websites and apps users will be redirected to Facebook Gaming.
In this regard, it must be noted that, the company’s Project xCloud technology will now deliver games to even Facebook Gaming users.
This will aid gamers to leverage Project xCloud technology to play high-end games on any device, thereby broadening the user base of Microsoft’s gaming service. Nevertheless, the move of abandoning Mixer can be viewed as acceding to Amazon’s (AMZN - Free Report) Twitch, which dominates the space.
Future of Mixer Tech in Microsoft
It must be noted that the technology that was leveraged by Mixer gaming platform will be retained by Microsoft.
Notably, Microsoft Teams will utilize Mixer’s ultra-low latency video streaming expertise, and features including real-time interactivity and robust video distribution technology.
Moreover, fan-centric capabilities are expected to deliver new productivity experiences to boost Teams experience and make it more immersive.
We believe the innovative use of Microsoft’s Mixer interactive technology to power Teams, which is acquiring users backed by coronavirus crisis induced work-from-home, online learning and telehealth care trends, is prudent.
This is expected to bolster adoption of Teams further, and boost revenues in the quarters ahead and instill investor optimism in the stock. The company currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Notably, shares of the company have returned 27.2% in the year-to-date period compared with the industry’s rally of 21.2%.
Competitive Scenario in Gaming
Microsoft is striving to democratize gaming, which it constantly evolves by means of easy viable pathways to boost game developers and release new games that reach a huge audience.
With Azure cloud capabilities, the company attempts to make gaming as interactive as possible to bolster engagement and gaming experience.
This had been aiding Mixer to acquire new customers from other competing platforms, including Twitch, Facebook Gaming and Alphabet’s (GOOGL - Free Report) YouTube Live.
Notably, the famous streamer, Richard Tyler Blevins, popularly known as Ninja decided to leave Twitch and inked a deal with Microsoft to stream on Mixer last year. Further, Michael Grzesiek who is best known as Shroud joined Mixer and left Twitch late last year. However, as of now, the latest move is likely to put similar streamers in a fix.
Moreover, despite all efforts, Twitch continues to lead the domain. Amazon maintained dominance in 2019 in terms of total hours watched. Twitch accounted for 75.1% compared with YouTube Live and Mixer’s 22.1% and 2.7%, respectively.
Microsoft’s new deal with Facebook Gaming is an attempt to take on the dominance of Twitch.
Markedly, Facebook Gaming is also gaining adoption among streamers other than Disguised Toast. Tempo ZeRo and Corinna Kopf have joined this platform in 2019. Further, the social media giant introduced charity live streaming tools for the Level Up gaming creators.
Additionally, the debut of two Pokémon games titled Pokémon Tower Battle and Pokémon Medallion Battle on Facebook Gaming deserve a special mention.
Further, Facebook has acquired PlayGiga, a Madrid-based company that specializes in cloud gaming in a bid to ramp up its gaming initiatives.
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