Video game rental company GameFly is set to position itself as the “Netflix-for-Games” by offering streaming services. Following in Netflix’s NFLX footsteps, GameFly, which traditionally mailed video game discs to paid members, will stream video games exclusively on Amazon AMZN Fire TV. The company will be using Playcast Media’s technology, a recently acquired Israel-based cloud company, for its new service, GameFly Streaming.
According to Verge, the company’s streaming services will be offered in 6-month subscription packs (Action Pack, Adventure Pack Gamer Pack, Speed Pack, Fun Pack and Lego Pack) at prices ranging from $6.99/month to $9.99/month. Despite the novelty of the latest offering, the fact that GameFly Streaming services is limited to Amazon Fire TV subscribers is a drawback, in our view, since a Fire TV subscription costs $99.00. Currently, most of the game titles are compatible with a $40 Amazon Fire TV controller.
Although not specified, we believe, over the long term, GameFly will make its streaming services available on a variety of streaming media devices, such as Apple AAPL TV and Google Chromecast. This will not only add viewers but also help it to expand internationally.
However, over the past few years, there have been several attempts by video game developers to mimic Netflix’s subscription-based business model. According to reports, cloud-gaming service, OnLive, recently winded up its business after a failed attempt in the streaming business. A portion of its business, however, was acquired by Sony, which itself started a streaming portal for PS3 games — PlayStation Now. In addition, technology giant Microsoft MSFT is planning to jump on the bandwagon with a streaming service for Xbox One.
While the upcoming streaming services offer a wide variety of options to users, market competition intensifies simultaneously for startups. Hence, it remains to be seen if GameFly will be able to survive amid the rapidly growing breed of video game streaming portals. While Gamefly boasts a loyal user base for game rentals, it will be interesting to see how the company captures user attention as it positions itself in the highly competitive online gaming business.
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