WEBVTT - TechStuff Twitches 0:00:03.360 --> 0:00:06.440 Get in touch with technology with tech stuff from half 0:00:06.480 --> 0:00:14.200 stuff dot com either everyone, and welcome to text stuff. 0:00:14.240 --> 0:00:17.479 I'm Jonathan Strickland and I'm Lauren. Before we get into this, 0:00:17.560 --> 0:00:21.119 I just want to alert listeners ahead of time. I've 0:00:21.160 --> 0:00:24.440 got a cold, so I'm going to sound a little weird. 0:00:24.840 --> 0:00:28.360 He's kind of raspy. Is it's a little bit tom? Wait? Yeah, 0:00:28.400 --> 0:00:31.240 you know the piano has been drinking and Jonathan has 0:00:31.280 --> 0:00:34.560 been on an airplane. So that's where we're at. Today's 0:00:34.640 --> 0:00:38.680 episode is brought to us courtesy of a little listener mail. 0:00:39.280 --> 0:00:43.120 This one is from Daniel via actual email. Yeah, apparently 0:00:43.280 --> 0:00:45.880 people still use that. By the way, guys, we've seen 0:00:46.000 --> 0:00:49.960 a big upswing and listener and email and Facebook and Twitter. 0:00:50.400 --> 0:00:52.880 We love it. Keep up the great so so much. 0:00:52.920 --> 0:00:55.400 We're sending we We love every single note that we receive. 0:00:55.480 --> 0:00:58.240 Even if we are too incredibly stressed out to respond 0:00:58.280 --> 0:01:00.000 to all of you. We love you, Thank you so much. 0:01:00.040 --> 0:01:02.360 I'm trying desperately to get through all the backlogs, so 0:01:02.480 --> 0:01:04.759 if you have written, I am working my way back 0:01:04.800 --> 0:01:08.560 to you, babe. Anyway, Daniel, he wrote to us to say, 0:01:08.760 --> 0:01:10.360 I don't know if you did this before, but we've 0:01:10.400 --> 0:01:13.600 recently had the news then online gaming streaming service called 0:01:13.680 --> 0:01:17.360 Twitch is surpassing live streaming services like you Stream, w 0:01:17.560 --> 0:01:22.080 w E Network live Stream, and other streaming services by volume. However, 0:01:22.160 --> 0:01:24.640 I don't really hear about it outside of gamer groups, 0:01:24.680 --> 0:01:27.039 which is odd to me. Can you all get into 0:01:27.080 --> 0:01:30.000 the details about how Twitch works, or maybe into live 0:01:30.080 --> 0:01:33.280 streaming in general. It's a growing trend in recent years. 0:01:33.360 --> 0:01:36.360 I can only see getting bigger as gaming audiences grow. 0:01:36.840 --> 0:01:39.360 You know what, Daniel, We agree it's a great topic. 0:01:39.440 --> 0:01:42.560 It's one that's become incredibly important as of the week. 0:01:42.560 --> 0:01:45.840 We're recording this podcast because they're Okay. So there's this 0:01:45.920 --> 0:01:47.960 rumor going around, and at this point it's a very 0:01:48.000 --> 0:01:52.160 strong rumor, although the parties that are involved are still 0:01:52.240 --> 0:01:55.240 not commenting officially on it, that Google in the form 0:01:55.280 --> 0:02:00.320 of YouTube is interested in purchasing Twitch for a billion dollars. 0:02:00.360 --> 0:02:03.880 So this was a story broken by Variety originally, and 0:02:03.920 --> 0:02:07.360 then it was corroborated by the Wall Street Journal, although 0:02:07.360 --> 0:02:11.520 again no one from either Twitch nor Google is is 0:02:11.600 --> 0:02:14.639 commenting on the subject. By the time this podcast comes out, 0:02:14.880 --> 0:02:16.840 it may very well be that all of this is 0:02:17.240 --> 0:02:20.320 supremely old news and that the the deal has either 0:02:20.440 --> 0:02:24.720 been agreed upon or declined, but we don't as we're 0:02:24.760 --> 0:02:27.480 recording this, don't know the outcome al right where we 0:02:27.560 --> 0:02:32.160 are recording this on May twenty and um, and yeah, 0:02:32.200 --> 0:02:34.040 these these two sources. By the way, Variety in the 0:02:34.040 --> 0:02:37.480 Wall Street Journal reported different stories, um that the sale 0:02:37.639 --> 0:02:40.480 is already certain, or that the talks are in early stages, 0:02:40.560 --> 0:02:43.160 and that Twitch might just sell stake in their company 0:02:43.240 --> 0:02:45.560 instead of selling the entire company as a whole. Right, 0:02:45.760 --> 0:02:49.280 And even though official sources are not doing any talking 0:02:49.320 --> 0:02:51.600 about it right now, anonymous sources have done a lot 0:02:51.639 --> 0:02:54.880 of talking. For for example, Verage reported that other companies, 0:02:54.880 --> 0:02:59.280 including Microsoft we're also according Twitch, but have been turned down. Um. 0:02:59.320 --> 0:03:01.960 At any rate, It's it's a really interesting news item 0:03:01.960 --> 0:03:05.720 for for both the gaming industry and the live streaming industry. 0:03:05.800 --> 0:03:08.640 And I guess video on the internet as a whole, yeah, 0:03:08.800 --> 0:03:11.000 And keeping in mind that video on the internet is 0:03:11.000 --> 0:03:14.240 still a very young thing. I mean, it wasn't that 0:03:14.320 --> 0:03:16.560 long ago that you didn't have any sort of video 0:03:16.600 --> 0:03:19.080 hosting services. And the way you would get video on 0:03:19.120 --> 0:03:21.960 the internet is that someone would save a video file 0:03:22.280 --> 0:03:24.760 and you'd have to download the whole thing to watch it. 0:03:25.160 --> 0:03:27.680 So this is a this is kind of showing the 0:03:27.720 --> 0:03:32.280 next step in in the the world of video online. 0:03:32.320 --> 0:03:35.560 So we've got the prerecorded stuff, which YouTube has got 0:03:35.640 --> 0:03:38.560 pretty sewn up at least for user generated. Then you've 0:03:38.560 --> 0:03:41.440 got the pre record stuff that is made by studios 0:03:41.440 --> 0:03:44.200 and television networks. Now that's all over the place like Netflix, Hulu, 0:03:44.240 --> 0:03:47.240 all that kind of stuff. And then you have broadcast 0:03:47.280 --> 0:03:50.080 where you're doing a live streaming event, which is what 0:03:50.160 --> 0:03:53.400 Twitch and other services like Twitch are all about. So 0:03:53.800 --> 0:03:56.119 how does that work? Why is it such a big 0:03:56.120 --> 0:03:59.200 deal of why why would Google even be interested in it? 0:03:59.320 --> 0:04:01.800 A lettle in one billion dollars worth of interest in Yeah, 0:04:01.880 --> 0:04:03.640 So we thought we would first go into a little 0:04:03.640 --> 0:04:06.240 bit of history. We like to always look back into 0:04:06.280 --> 0:04:09.920 how things became what they are. So let's, uh, let's 0:04:09.960 --> 0:04:11.880 just think we're not going to get into the way 0:04:11.880 --> 0:04:14.880 back machine because this is pretty recent history. Lauren and 0:04:14.920 --> 0:04:17.839 I both lived through this history. It wasn't going on 0:04:17.880 --> 0:04:20.760 immediately around us, but we were technically alive while it 0:04:20.839 --> 0:04:22.920 was happening, yes, which is relatively rare for the two 0:04:23.000 --> 0:04:24.440 of us. For lots of the history that we do 0:04:24.480 --> 0:04:26.800 on this show. Yeah, there was a period in when 0:04:26.839 --> 0:04:29.680 I was dead to the world. So anyway, Twitch is 0:04:29.839 --> 0:04:31.560 kind of a first of all, it's a spinoff of 0:04:31.560 --> 0:04:35.400 another company. It's so in order to understand where Twitch 0:04:35.440 --> 0:04:37.360 came from, you have to go back a little further 0:04:37.400 --> 0:04:40.080 and look at the origin of this other company, Justin 0:04:40.160 --> 0:04:44.520 TV exactly who, which was founded by Justin Cohn, Emmett Sheer, 0:04:44.640 --> 0:04:48.479 Michael Cybel, and Kyle Vauched. And so here's the thing. 0:04:48.920 --> 0:04:53.120 Even that company was the product of some other some 0:04:53.160 --> 0:04:55.960 other work done by this group of people that didn't 0:04:55.960 --> 0:04:58.320 work out so much. You see, you had this group 0:04:58.360 --> 0:05:03.479 who created a web calendar software called Keiko. This was 0:05:03.560 --> 0:05:06.080 from a group who had gone to Yale together I think, 0:05:06.160 --> 0:05:10.760 and formed the company soon after graduation. And so they 0:05:11.080 --> 0:05:16.320 were approached by a brand new seed company called y Combinator. 0:05:16.320 --> 0:05:20.000 And a seed company is all about finding startups to 0:05:20.000 --> 0:05:24.400 to finance, to fund, hoping that those startups will blossom 0:05:24.560 --> 0:05:28.080 and therefore those investments will end up making huge returns 0:05:28.160 --> 0:05:31.520 in return. You also see these companies that otherwise might 0:05:31.560 --> 0:05:35.520 not have a chance grow into something really interesting. Right. 0:05:35.560 --> 0:05:39.040 Part of that same batch was both Reddit and Infogami, 0:05:39.120 --> 0:05:40.880 which is one of those companies that was started by 0:05:40.880 --> 0:05:44.160 Aaron Schwartz. Yeah, so amazing group of people, right, So 0:05:44.240 --> 0:05:47.680 not just the smarty pants folks behind Kiko, but these 0:05:47.720 --> 0:05:50.320 other groups as well. I mean, Reddit is now one 0:05:50.360 --> 0:05:53.840 of the more popular sites on the Internet has a 0:05:53.880 --> 0:05:57.320 flourishing community, although it's a community that has its own 0:05:57.440 --> 0:06:00.599 uh issues and in fighting. Well yeah, I think the 0:06:00.640 --> 0:06:04.240 more popular Reddit gets, the more irritated the hardcore audience. 0:06:05.279 --> 0:06:07.880 But the same thing happened to dig so it'll be 0:06:07.880 --> 0:06:09.560 interesting to see what happens with Reddit. But that's a 0:06:09.600 --> 0:06:14.160 totally different podcast. So here's the thing about kiko um. 0:06:14.200 --> 0:06:18.120 It was, according to Justin con himself, not that great 0:06:18.160 --> 0:06:20.560 of a product, and the reason he gave behind that 0:06:20.640 --> 0:06:24.320 was that he and his fellow programmers didn't really need 0:06:24.360 --> 0:06:26.880 a calendar. He said, I was going to college, I 0:06:26.920 --> 0:06:30.360 had two classes, I had classes on on two days 0:06:30.400 --> 0:06:33.200 of the week, and otherwise I was sitting around programming. 0:06:33.279 --> 0:06:35.680 So what the heck do I need a schedule for? 0:06:36.240 --> 0:06:38.520 It does not useful to me. So since I didn't 0:06:38.560 --> 0:06:40.880 need it, I wasn't using it, and since I don't 0:06:41.080 --> 0:06:45.520 use it, the products we were making weren't very compelling. 0:06:46.360 --> 0:06:49.040 And then Google calendar comes out and everyone's like, well, 0:06:49.880 --> 0:06:51.640 so they decided what we're gonna do is we're gonna 0:06:51.680 --> 0:06:53.840 sell this company for as much as we can so 0:06:53.880 --> 0:06:56.640 that we can pay back our investors and then constrate 0:06:56.800 --> 0:06:59.160 something else. So of course, they sold their company the 0:06:59.200 --> 0:07:03.680 way any sane person would. They listed it on eBay, 0:07:03.920 --> 0:07:06.719 and it's sold on eBay for some two and fifty 0:07:06.720 --> 0:07:09.800 eight thousand dollars to a Canadian company called two Cows 0:07:10.320 --> 0:07:13.280 to Cows. Two Cows. Yeah, yeah, they have two cows, 0:07:13.320 --> 0:07:15.360 twice as many cows as someone who has one cow. 0:07:15.960 --> 0:07:19.920 So yeah, except its spelled t u c ows, but yeah, 0:07:20.000 --> 0:07:22.160 it's it's It was funny because they were going for 0:07:22.200 --> 0:07:25.720 just fifty dollars. They wanted fifty grand. They were hoping 0:07:25.880 --> 0:07:28.120 they could get fifty grand so they could pay off 0:07:28.160 --> 0:07:30.800 their investors, and then they saw that it had hit 0:07:30.840 --> 0:07:33.000 eighty grand and they thought, oh, we got some walk 0:07:33.040 --> 0:07:35.800 in money now, and it finally sold for two eight 0:07:35.840 --> 0:07:39.520 thousand dollars on eBay. All right, yeah, yeah, two two 0:07:39.520 --> 0:07:42.400 cows and a calendar app that. Yeah, that's great. I 0:07:42.440 --> 0:07:45.000 had no idea you could actually list a company on eBay, 0:07:45.040 --> 0:07:48.360 and the idea that that's involved in the terms of 0:07:48.400 --> 0:07:52.520 service blows my mind. Anyway, they successfully sell Keiko, and 0:07:52.520 --> 0:07:56.840 in two thousand seven, Justin and Emmett pitched this idea 0:07:56.920 --> 0:08:00.200 of justin dot TV to Paul Graham. Paul Graham was 0:08:00.240 --> 0:08:04.920 the guy who founded the y Combinator Seed company, and 0:08:05.040 --> 0:08:07.920 the premise originally was not for some sort of live 0:08:07.960 --> 0:08:11.840 broadcast uh service for the general public, all right, It 0:08:11.880 --> 0:08:13.720 was sort of a curiosity. The idea was to just 0:08:13.840 --> 0:08:19.040 put a webcam um basically on on Kan's head and 0:08:19.560 --> 0:08:22.120 have it broadcast twenty four hours a day, seven days 0:08:22.120 --> 0:08:23.760 a week. So I think that he was doing so 0:08:23.800 --> 0:08:26.680 it was justin TV, justin TV, right, it was. It 0:08:26.760 --> 0:08:28.720 was like it was a kind of life casting, except 0:08:28.720 --> 0:08:31.120 instead of having the camera turned back on himself, it 0:08:31.200 --> 0:08:35.240 was more or less from his perspective and view. Yeah, yeah, 0:08:35.280 --> 0:08:38.800 there's some great stories about weird things that happening. Within 0:08:38.880 --> 0:08:42.600 the first week of going live, apparently his audience felt 0:08:42.600 --> 0:08:46.960 that it was not the most compelling of of entertainment, 0:08:47.280 --> 0:08:50.480 that watching a guy sit in an apartment and code 0:08:50.920 --> 0:08:54.040 was not necessarily the most interesting subject matter, that it 0:08:54.080 --> 0:08:56.280 needed a little bit of spice, so um, so they 0:08:56.360 --> 0:08:58.480 provided it to the audience. Provided the spice this is 0:08:58.520 --> 0:08:59.680 where you know, it's kind of like when you hear 0:08:59.720 --> 0:09:03.680 about a news outlet making the news. In this case, 0:09:03.720 --> 0:09:06.520 it was the audience making the contact content. How do 0:09:06.600 --> 0:09:10.319 they make the content? They contact the police and say 0:09:10.360 --> 0:09:13.640 that there was a report of a stabbing incident in 0:09:14.160 --> 0:09:17.240 Justin Kahn's apartment. So the police pay a little visit. 0:09:17.280 --> 0:09:20.679 By the way, this entire incident is preserved on YouTube 0:09:20.720 --> 0:09:22.880 if you want to watch it. And so you hear 0:09:23.480 --> 0:09:26.960 the cops knocking at the door, they come inside. They 0:09:27.040 --> 0:09:30.440 explained that they got a report about stabbing. Pretty quickly, 0:09:30.480 --> 0:09:34.880 Justin figures out, Hey, the it's our users who have 0:09:35.000 --> 0:09:37.680 decided that this is this would be entertaining to watch. 0:09:38.120 --> 0:09:42.440 What a bunch of scamps um. There were other incidents 0:09:42.440 --> 0:09:45.120 that were similar, where they would call in fake fires 0:09:45.360 --> 0:09:47.680 and there were like six or seven fire trucks lined 0:09:47.720 --> 0:09:52.080 outside of Justin's apartment legally culpable scamps that. Yeah, So 0:09:52.200 --> 0:09:56.200 eventually they decided, hey, you know this, Uh, this idea 0:09:56.840 --> 0:10:00.440 isn't working because Justin's just not interesting enough off to 0:10:00.520 --> 0:10:03.439 keep everyone's attention. Uh. There are other incidents as well. 0:10:03.480 --> 0:10:06.840 There are plenty of videos online that explained the hijinks 0:10:06.880 --> 0:10:09.959 these guys got up to But what happened was they 0:10:10.000 --> 0:10:13.959 decided this isn't sustainable, it's not entertaining, So what can 0:10:14.040 --> 0:10:17.640 we do. How can we modify what we've built into 0:10:17.720 --> 0:10:22.160 something that actually resonates with people. So they revisit the 0:10:22.200 --> 0:10:25.240 idea and they discussed different approaches, and they came up 0:10:25.280 --> 0:10:28.600 with this idea of using the justin TV as a 0:10:28.640 --> 0:10:33.200 platform for other people to broadcast things live over the Internet. 0:10:33.720 --> 0:10:37.760 So this was the democratization of live broadcast. YouTube had 0:10:37.800 --> 0:10:43.280 created the democratization of of sharing video. But but you didn't. 0:10:43.320 --> 0:10:45.560 You couldn't do live events on YouTube at the time, 0:10:46.240 --> 0:10:49.000 So what would where would you go if you wanted 0:10:49.040 --> 0:10:52.120 to have like a live call in show, for example, 0:10:52.760 --> 0:10:55.040 and you were using maybe Skype for people to call 0:10:55.120 --> 0:10:57.960 in so that you could answer questions live on the air, 0:10:58.120 --> 0:11:01.200 You didn't really have that option. But because people couldn't 0:11:01.280 --> 0:11:03.480 hear you and then respond to you in real time, 0:11:03.920 --> 0:11:07.079 twitch or not twitch. But justin TV was a chance 0:11:07.120 --> 0:11:09.720 of doing that. So it's kind of interesting. They said 0:11:09.760 --> 0:11:11.640 that the only reason they were able to do it 0:11:11.720 --> 0:11:16.440 is because while they had been developing justin dot tv, uh, 0:11:16.480 --> 0:11:18.640 they had advanced the technology to a point that brought 0:11:18.720 --> 0:11:22.400 the cost of streaming video down significantly to just like 0:11:22.480 --> 0:11:24.680 a couple of cents or a couple of fractions of 0:11:24.679 --> 0:11:29.240 assent UH for a minute of video, which was important 0:11:29.240 --> 0:11:32.079 because you know, depending upon how much bandwidth you were using, 0:11:32.080 --> 0:11:34.120 your I s P might be charging you quite a 0:11:34.120 --> 0:11:36.760 bit for it. Oh sure, but at that rate, with 0:11:36.880 --> 0:11:42.640 a combination of advertising revenue from from ads and also 0:11:42.760 --> 0:11:45.520 money from investors, they could kind of plug along, yeah exactly. 0:11:45.559 --> 0:11:49.160 The ad supported videos helped them recapture some of the costs, 0:11:49.160 --> 0:11:52.960 and they also got some pretty significant funding, like their 0:11:53.040 --> 0:11:56.599 their first round UH netted them about two million dollars. 0:11:56.640 --> 0:11:59.120 They would later get I think twenty million a couple 0:11:59.120 --> 0:12:02.320 of years down the road. So they were getting money 0:12:02.400 --> 0:12:05.880 from investors who said, this is the future of this 0:12:06.000 --> 0:12:09.559 kind of internet delivery system. Plus they were thinking ahead 0:12:09.600 --> 0:12:12.240 of how can we monetize this so that once once 0:12:12.280 --> 0:12:15.240 we get past that investment period, how do we keep 0:12:15.240 --> 0:12:18.640 making money? And that was through the ad support, So 0:12:19.160 --> 0:12:21.960 they began to think, how can we really make it 0:12:22.000 --> 0:12:24.160 easier for people to find the stuff they want? Because 0:12:24.200 --> 0:12:27.400 as more people join, it gets crowded, right, and you're like, well, 0:12:27.559 --> 0:12:29.400 there's a ton of people on here, but I'm only 0:12:29.440 --> 0:12:33.600 interested in one specific topic. Uh. And so they started 0:12:33.600 --> 0:12:36.440 to make categories and things like people who wanted to 0:12:36.480 --> 0:12:39.600 talk about business, or people who wanted to talk about fashion, 0:12:39.720 --> 0:12:43.000 or people wanted to talk about sports or video games, 0:12:43.320 --> 0:12:47.120 and the video games category began to get incredibly popular, 0:12:47.240 --> 0:12:50.880 something that mystified justin by the way you can watch 0:12:50.920 --> 0:12:53.120 video interviews, and he said, I just didn't get it. 0:12:53.160 --> 0:12:57.200 People were playing video games and streaming their video game 0:12:57.280 --> 0:13:00.520 experience online and other people were watching it. What's up 0:13:00.520 --> 0:13:03.600 with that? He just he was like, I didn't understand it, 0:13:03.640 --> 0:13:06.320 but I realized that other people found it valuable, So 0:13:06.360 --> 0:13:08.440 we knew that it was something we had to look at. 0:13:09.240 --> 0:13:11.559 So they start thinking, well, you know, this makes a 0:13:11.640 --> 0:13:13.679 lot of sense. We've we've got all these people who 0:13:13.720 --> 0:13:17.960 are um watching stuff. We should try and take advantage 0:13:17.960 --> 0:13:23.160 of that. So they ultimately on June six, two eleven, 0:13:23.280 --> 0:13:26.959 launched twitch dot tv in public beta as a completely 0:13:27.080 --> 0:13:30.120 separate brand. Now, this was the idea of let's take 0:13:30.160 --> 0:13:33.960 that video game content that everyone is streaming and create 0:13:34.000 --> 0:13:37.320 a product specifically for that, with tools built in to 0:13:37.440 --> 0:13:40.240 help people do that more smoothly, so they don't have 0:13:40.320 --> 0:13:43.600 to create their own system at home to make it work. 0:13:43.640 --> 0:13:45.800 We're going to try and integrate it in as many 0:13:45.840 --> 0:13:49.640 different approaches as possible so that more people can do this, 0:13:49.679 --> 0:13:53.320 because it's clearly a runaway success story, and it made 0:13:53.400 --> 0:13:55.679 much more sense to create a new brand than to 0:13:55.800 --> 0:13:58.280 just nestle it under justin dot tv. In fact, Twitch 0:13:58.320 --> 0:14:01.439 dot tv was getting bigger than just dot tv. Yeah, 0:14:01.520 --> 0:14:04.760 they they basically immediately found an audience. They started with 0:14:04.840 --> 0:14:09.320 some three point two million unique visitors per month. Yep. Yeah, 0:14:09.440 --> 0:14:13.560 they they've increased that a little bit. Yes, about a 0:14:13.679 --> 0:14:17.520 year later, they would hit twenty million unique visitors per month. Yeah, 0:14:17.600 --> 0:14:20.520 and I think they're at forty five million currently, so 0:14:20.720 --> 0:14:24.760 it is essentially doubled, like year over year, more than 0:14:24.800 --> 0:14:27.239 doubled on that first one. So that was pretty impressive. 0:14:27.280 --> 0:14:29.400 And you know, keep in mind that back in June 0:14:29.400 --> 0:14:31.560 two th eleven, it was just in beta. It wasn't 0:14:31.560 --> 0:14:36.120 even the full release yet. So they started having lots 0:14:36.120 --> 0:14:39.239 of Like there's certain games that that definitely drove participation, 0:14:39.320 --> 0:14:41.520 StarCraft too being a big one. Anything that you can 0:14:41.520 --> 0:14:45.120 get big tournaments going for exactly. So, and you know 0:14:45.160 --> 0:14:49.200 there are places like in South Korea where StarCraft tournaments are, 0:14:49.520 --> 0:14:52.400 like the super Bowl is here in the United States, 0:14:52.720 --> 0:14:56.040 so you get these enormous crowds live audiences watching these 0:14:56.280 --> 0:14:58.640 well only here in the US. It just it never 0:14:58.720 --> 0:15:02.880 really caught on that way, mostly because production costs or 0:15:02.920 --> 0:15:05.480 something like that. If you wanted to televise it, we're 0:15:05.560 --> 0:15:09.520 so high that you would have trouble getting the audience 0:15:09.600 --> 0:15:13.080 large enough to justify that expense. But the overhead for 0:15:13.160 --> 0:15:16.840 Twitch is way lower. I mean, you don't have as 0:15:16.880 --> 0:15:21.960 many employees for one thing, the infrastructure is once you've 0:15:22.200 --> 0:15:26.520 made the investment, much less expensive than television. So it 0:15:26.600 --> 0:15:29.280 was sort of the perfect platform for that and it 0:15:29.360 --> 0:15:32.720 really took off. It also allows the audience to talk 0:15:32.720 --> 0:15:35.080 to each other during the event in a way that 0:15:35.240 --> 0:15:39.000 the normal broadcast television obviously doesn't allow unless you invite 0:15:39.040 --> 0:15:41.400 a lot of your friends over right, or you have 0:15:41.720 --> 0:15:43.880 some app where you can watch the show and talk 0:15:43.920 --> 0:15:46.120 with other fans. But we've seen this over and over 0:15:46.200 --> 0:15:49.840 that television makes it. It's really hard to get something 0:15:49.880 --> 0:15:52.920 like that to work from a television platform and poured 0:15:52.920 --> 0:15:56.920 it over into an online interactive platform. Usually you see 0:15:56.920 --> 0:15:59.000 people just use either Twitter or Facebook for that kind 0:15:59.000 --> 0:16:01.800 of thing, right, And in eleven that wasn't so much 0:16:01.840 --> 0:16:04.160 the case quite yet, No, no, you know, so this 0:16:04.320 --> 0:16:06.280 in this case, you have a platform that by its 0:16:06.360 --> 0:16:09.960 very nature allows for that kind of thing. However, as 0:16:09.960 --> 0:16:13.520 of eleven it's still was not profitable and would not 0:16:13.640 --> 0:16:17.160 become I think it technically has never been profitable for 0:16:17.240 --> 0:16:23.000 a full year. They are estimating that as it will be, right, 0:16:23.160 --> 0:16:25.680 But well, well we'll see. You have to get that 0:16:25.880 --> 0:16:30.840 great balance of AD dollars and user base in order 0:16:30.880 --> 0:16:33.880 to make it profitable. And of course the bigger it gets, 0:16:34.080 --> 0:16:35.760 the more of an investment you have to make in 0:16:35.800 --> 0:16:39.880 the company's infrastructure. Right. Of course, us a few things 0:16:39.960 --> 0:16:43.640 that helped out greatly with that. Yeah. Yeah. For one thing, 0:16:43.920 --> 0:16:47.760 you've got the fact that both Sony and Microsoft gave 0:16:47.800 --> 0:16:52.120 Twitch a big thumbs up. Right, they announced partnerships that 0:16:52.160 --> 0:16:56.080 would allow a native app on both of those gaming 0:16:56.080 --> 0:16:59.760 platforms to integrate Twitch tv. Right. So, with the case 0:16:59.800 --> 0:17:02.560 of of PlayStation four, there's a button on the controller 0:17:02.560 --> 0:17:04.840 where you can start sharing what you're playing. It's a 0:17:04.880 --> 0:17:07.560 little more complex with Xbox one. Uh. And in both 0:17:07.600 --> 0:17:10.800 cases it was a feature that was not immediately implemented 0:17:10.800 --> 0:17:13.399 as soon as the consoles came out, but was implemented 0:17:13.440 --> 0:17:16.639 a little bit later on the life cycle of those consoles, 0:17:17.119 --> 0:17:19.000 I say life cycle, and these things haven't even been 0:17:19.000 --> 0:17:21.639 out a full year yet. Yeah, it's really interesting to 0:17:21.720 --> 0:17:24.720 see that they were throwing their support behind this because 0:17:24.760 --> 0:17:28.160 they could see both Sony and Microsoft could see that 0:17:28.480 --> 0:17:30.960 this this was a trend that was growing, that people 0:17:31.160 --> 0:17:34.360 were eager to share their experiences and more people were 0:17:34.400 --> 0:17:37.680 eager to to eat it all up. So I mean, 0:17:37.760 --> 0:17:40.639 I've watched play throughs online. Of course, the playthroughs I 0:17:40.640 --> 0:17:43.680 watched tend to be done for for comedic purposes, where 0:17:43.680 --> 0:17:45.679 it's a bunch of guys who are playing who know 0:17:45.760 --> 0:17:48.440 each other really well, and they're really doing it as 0:17:48.520 --> 0:17:51.520 a way of entertaining other people, Like that's the whole 0:17:51.520 --> 0:17:55.040 purpose of it. They're not playing a game competitively against others, 0:17:55.040 --> 0:17:57.520 which is what a lot of the Twitch TV stuffs for. 0:17:58.200 --> 0:18:01.359 Not everything, but also you have you have streamed yourself 0:18:01.440 --> 0:18:04.160 on Twitch, haven't you? I did. I did for twenty 0:18:04.160 --> 0:18:08.560 five hours straight. I did a stream of me just 0:18:08.760 --> 0:18:12.440 playing Minecraft. It was for the Extra Life charity, which 0:18:12.520 --> 0:18:15.680 raises money for to buy video games and video game 0:18:15.720 --> 0:18:19.720 systems for kids who are in hospitals and uh, so 0:18:19.840 --> 0:18:21.199 I was part of this. It was kind of like 0:18:21.200 --> 0:18:24.679 a Pledge Drive type thing. And for twenty five hours 0:18:24.680 --> 0:18:27.959 I played and and streamed it live, and I always 0:18:28.000 --> 0:18:30.480 had at least one or two people watching. Sometimes I 0:18:30.520 --> 0:18:33.240 would have you know, a few dozen watching at a time. 0:18:33.920 --> 0:18:36.240 UH And I even had a thing where for certain 0:18:36.359 --> 0:18:41.800 levels of contributions, I would build uh monuments within Minecraft, 0:18:42.000 --> 0:18:44.879 and the more money you made, the bigger and more 0:18:45.040 --> 0:18:48.119 rare the monument would be, like the materials would be 0:18:48.119 --> 0:18:53.080 more rare. So some people were incredibly generous and I 0:18:53.160 --> 0:18:56.640 had to go and find the rarest materials and Minecraft 0:18:56.880 --> 0:18:59.399 within twenty five hours and still build it. Like actually, 0:18:59.400 --> 0:19:01.320 I was like, all, so for the first eighteen hours, 0:19:01.400 --> 0:19:04.959 I'm just mining and then for the last seven hours 0:19:04.960 --> 0:19:07.880 I'll be building. So yeah, it was actually a lot 0:19:07.920 --> 0:19:10.080 of fun. But because of Twitch, I was able to 0:19:10.080 --> 0:19:12.200 stream it live and people could check in on me 0:19:12.240 --> 0:19:14.600 and see that I was actually doing this thing that 0:19:14.640 --> 0:19:17.200 I had said I would do. UM And I also, 0:19:17.280 --> 0:19:19.719 you know, I got to have an ongoing conversation with 0:19:19.760 --> 0:19:22.159 folks through chat. He would chat to me and I 0:19:22.160 --> 0:19:24.680 would answer that questions live while playing and and kind 0:19:24.680 --> 0:19:27.639 of keep you motivated while you were doing this ridiculous marathon. 0:19:27.800 --> 0:19:30.720 Sometime around our number nineteen or twenty, I definitely needed 0:19:30.720 --> 0:19:33.200 some more motivation. Not to mention coffee. I think that's 0:19:33.240 --> 0:19:35.640 the wall that they talked about in Marathon ng UM. 0:19:35.640 --> 0:19:39.639 In September, Twitch sold an undisclosed stake in the company 0:19:39.720 --> 0:19:43.080 to investors, raising that twenty million dollars that you mentioned earlier, 0:19:43.119 --> 0:19:45.760 and a lot of that went to supporting their rollout 0:19:45.800 --> 0:19:48.479 into the PS four and Xbox one. Yeah. Now, if 0:19:48.480 --> 0:19:51.800 you're looking at today's numbers, according to Mercury News that 0:19:51.920 --> 0:19:56.359 this was astounding. Twitch dot tv accounts forty percent of 0:19:56.520 --> 0:20:01.080 all United States live streaming online. That's more than any 0:20:01.080 --> 0:20:06.159 other live streaming site, including ESPN, NBC Sports and YouTube Live. Um. 0:20:06.400 --> 0:20:08.600 This is all according to Quilt, which is a company 0:20:08.640 --> 0:20:12.360 that helps networks manage bandwidth demand for video online and 0:20:12.440 --> 0:20:15.159 announced that they had begun working with Twitch in April. 0:20:16.520 --> 0:20:21.280 Twitch tv receives more than forty million unique visitors each month, 0:20:21.359 --> 0:20:24.440 which I think we mentioned before. But yeah, that's a lot. 0:20:25.000 --> 0:20:28.359 Like sure, if you look at YouTube, YouTube is getting 0:20:28.359 --> 0:20:31.720 a billion, okay, but YouTube has Google behind it and 0:20:31.840 --> 0:20:35.399 is adding a hundred hours of footage every minute, right, 0:20:35.840 --> 0:20:37.919 This is this is considering that this is something that 0:20:38.000 --> 0:20:40.960 was a spinoff of another company and has only been 0:20:41.440 --> 0:20:45.920 around for for less than four full years, it's phenomenal. Yeah, 0:20:45.920 --> 0:20:47.879 and its users spend an average of a hundred and 0:20:47.960 --> 0:20:52.840 six minutes per day watching streams average. That is also insane. 0:20:52.920 --> 0:20:56.040 That's so not to spoil it, but that's going to 0:20:56.160 --> 0:20:57.960 come into play when we have our conversation of why 0:20:57.960 --> 0:20:59.800 the heck would Google wants to spend a billion dollars 0:20:59.800 --> 0:21:01.760 on the yes. To put all of this in perspective 0:21:01.800 --> 0:21:05.040 a little bit, In February, a company called deep Field, 0:21:05.080 --> 0:21:07.919 which does Internet data analysis for media companies like the 0:21:07.920 --> 0:21:11.280 Wall Street Journal, Ransom numbers and reported that Twitch accounts 0:21:11.320 --> 0:21:14.640 for one point eight percent of United States peak internet traffic, 0:21:14.880 --> 0:21:18.359 which places it fourth overall after Netflix, which stands at 0:21:19.040 --> 0:21:24.840 Google and Apple four point three. That also puts it 0:21:24.920 --> 0:21:28.359 ahead of companies like Hulu, Facebook, and Valve, all of 0:21:28.359 --> 0:21:31.280 which come in a couple tents of a percentage point lower. 0:21:31.480 --> 0:21:35.120 That's pretty amazing. I mean, now, granted, these are all 0:21:35.200 --> 0:21:39.480 different things, right because with Google, the fact that is 0:21:39.520 --> 0:21:43.160 Google is pretty impressive considering that that's it's text based. Yeah, yeah, 0:21:43.160 --> 0:21:46.199 it's not just uh, I mean, I guess Google that 0:21:46.200 --> 0:21:49.359 probably also includes YouTube, so that's probably some video in 0:21:49.400 --> 0:21:52.199