This is a massive cut.

Twitch has been through a lot of turmoil recently, including a big round of layoffs last year, but this is not a good sign for what is the primary video streaming platform for gaming. Of course Twitch has expanded well beyond games at this point, but gaming itself hasn't migrated off the platform.

The CEO's explanation is that Twitch was too large for its current business and had been scaled for growth that never game. That sounds like a lot of companies that scaled up during the pandemic and for some reason thought that the growth would continue forever. Of course unlike a lot of those companies Amazon is incredibly solvent so this is a choice, and the choice is to cut over a third of the staff of a company that already seems understaffed in a number of areas like moderation.

In addition to feeling sympathy for the workers affected I worry both about streamers and the viability of the platform long term. Amazon does not seem very committed to gaming and Twitch clearly has not been a profit center if it needs cuts this deep. Just bad news all around.

Interesting, a popular Korean IRL streamer I follow announced before the Christmas holiday that her country was abandoning Twitch in February this year because streaming cost was too high for the country to handle. She is currently trying to change her status so that she will be part of Twitch America and continue streaming. But it seems like the problem Twitch is having is a lot bigger than that. This is looking like Twitch as a whole might someday either shutdown, or massively scale back many of the stuff the website is currently doing.

Twitch is in a tough place. Several years of bizarre choices coming from senior management combined with the aforementioned gamble on a temporary growth rate jump somehow becoming permanent (a gamble many tech companies made that I still can't wrap my head around since it was so obvious even at the time that the level of growth they were seeing in March-June of 2020 wasn't going to sustain forever) not working have all hurt the company a fair amount. Many of these were own-goals that could have been prevented had their senior management had literally anything resembling foresight (most recently, their attempt at allowing nudity on the platform blowing up in their faces followed by the CEO saying "Who could have seen this coming?". I mean... come on). As with all of the other cases recently, it seems the only people who suffer consequences from dumb gambles and mismanagement of the upper suites of companies are the rank-and-file workers doing the actual work who had nothing to do with these decisions.

Then there's the YouTube-shaped elephant in the room staring Twitch down right now (I know TikTok also has streaming but that's a completely different beast than the market Twitch and YouTube are going after). YouTube has been branching out into streaming the last couple years but especially the last year in a way they hadn't previously (Streaming on YouTube has technically existed for years now but it hasn't been pushed like it is now. Now there are the equivalent of Twitch subs along with other means of paying channels money). Twitch's decision to relax their restreaming rules coinciding with these pushes has made these efforts work even better than expected. A lot of folks I follow either already are or are considering restreaming to YouTube and in general the number of people watching streams on YouTube is increasing dramatically. For GB, a lot of their YouTube streams are starting to get viewership numbers just slightly lower Twitch whereas when they first started also streaming to YouTube they only got a small fraction of the number of viewers on Twitch. Other streams I watch have larger viewership on YouTube than Twitch now because they have a much larger follower base on YouTube. YouTube's stream player is also generally much better than Twitch's and allows users to rewind so they can catch things they missed which is a feature people have been begging Twitch to implement for probably a decade or more now.

edit:

Yeah, same with the Korean Starcraft 2 streamers I follow. Twitch's decision to leave Korea is basically ending their careers as SC2 players since their paying subscriber base is largely non-Korean and the most popular Twitch-like streaming platform in Korea, AfreecaTV, isn't really designed to be used by non-Koreans (The website is only in Korean so it's tough to browse for people who don't speak the language and the streams in general don't work well in other countries since they don't have the server infrastructure in other countries most services have). The few I know who are continuing are either pivoting to YouTube streaming or trying to make it so they can stream to other servers in other countries on Twitch, which isn't guaranteed to work. The fact that they just announced this out of nowhere with no heads up and only a couple months of notice really sucks too. People had no idea this was potentially happening.

Don't forget that Twitch is also killing Nintendo Switch support this month.

@ben_h: Twitch's viewership numbers are really good, even the covid bump has pretty much stuck source.

The elephant in the room is Twitch doesn't make much money if at all, when you view their actions throught that lens they make a lot more sense.

YouTube, Meta and Tiktok don't come close in livestreaming gaming, the problem for Twitch is advertising only to gamers isn't that attractive. Amazon have a vast audience that's difficult to monetize not counting a big source of revenue for streamers are endorsements and tips which they don't see.

It's not sustained viewership we're referring to but growth. Twitch, alongside a whole pile of other tech companies, assumed the explosive growth they saw in 2020 would continue in perpetuity rather than being a one-off thing. The numbers you provide even agree with our point. There is a one-time large amount of growth in viewership from March 2020 until around January of 2021 then things level off and growth stops. Between March 2020 and around a year later, a bunch of tech companies went on colossal hiring sprees because they were under the assumption they would need all of these extra people to handle the increase in demand over the next few years. Microsoft hired a massive number of people. Google did the same as did basically every other tech company. Then about a year and a bit after all of this hiring ended, they all started doing massive layoffs because the stupid gambles their executives made that the growth they saw in 2020 would continue forever didn't happen.

Twitch is actually late to the party for layoffs when compared to the other tech companies. Microsoft laid off some ridiculous number of more than 10000 people earlier last year as did Google. For the last year or so, getting a job in tech has been a nightmare because all of the new grads from the last couple years are competing with tens of thousands of laid off folks with experience in the same sector so not only are all of the people directly laid off by these companies affected, but so are the next generation of workers. All of this because tech executives have no semblance of foresight.

@ben_h: Sure the layoffs are in part chasing unsustainable growth, but it doesn't change the fact Twitch doesn't make money or ever did. Twitch's growth has been actively harmful to them, Amazon would have been more prepared to accept the loses if it was smaller.

Why would Mary Kish do this