Let me start off by saying that the recent rumor that YouTube will pay $1 billion to acquire Twitch is great news for YouTube and makes perfect sense. Google created a great feature with Google hangouts and although they integrated it well with YouTube, it never gained traction as a community based streaming tool, like Ustream or BlogTV. Acquiring Twitch, even at the steep cost of $1 billion, would instantly give YouTube the top online streaming community. Even better is the fact it is almost solely based on video games, one of the fastest growing segments on YouTube. As is evident with YouTube, it is more the community behind the site that helps push it to successful heights, rather than simply the site itself.
Good and Bad News for Twitch?
This could be both good and bad for Twitch. This could be great for Twitch in the sense that Google has limitless funds and a great infrastructure to add to value for Twitch. Google could be the catalyst that propels Twitch from popular streaming service to household name. Twitch is also rumored to have a lower CPM than popular YouTube channels so the advertising deals on YouTube could help Twitch streamers earn more. On the other hand, if YouTube/Google try to turn Twitch into Twitch+, it could be a disaster. Part of the frustration with Google Hangouts or Live YouTube broadcasts is that the chat system is a bit wonky for viewers and the viewing experience isn’t intuitively engaging. For both streamer and viewer Twitch provides a greatly improved experience. So when YouTube/Google inevitably choose to integrate the functionality with Google accounts, things could get messy.
YouTube and Copyright Infringement Issues
One of the biggest risks for Google in this whole endeavor would be further issues with copyrights. Currently Twitch streamers have no problem at all playing an entire playlist of top hits through Pandora or Spotify while they stream their games. YouTube treads a lot more lightly with copyright and the ability to stream anything and everything could be met with some red tape and takedown notices for streams. Google also risks action from the federal government as this acquisition would appear to further enhance their dominance of the online video market and give the appearance of a monopoly. With this piece of the online video pie, they would control not only the largest video sharing community/service, but they would also have one of the largest video streaming services. Although this does pose a major concern and likely would cause an inquiry, Google is simply competing with the likes of Amazon, Facebook and Twitter.
In the end, this acquisition might pose quite the headache for the Twitch community as they are inevitably forced into a Google account and the pains of becoming part of the Borg, but the opportunity to grow Twitch to include more than just video games and become the backbone of something like Chromecast would be too tempting of an offer to pass up. As Google lays down fiber across the country one city at a time, it only makes sense that their next step is to start streaming live and compete not only through YouTube videos, but with live TV broadcast that are shrinking daily as viewers move to online video.