Update #1: The Wall Street Journal is now corroborating and confirming TI's story.
Update #2: It's official, Amazon is buying Twitch for $970 million in cash. The acquisition is expected to close in 2H of 2014.
Amazon.com to Acquire Twitch
SEATTLE--(BUSINESS WIRE)--Aug. 25, 2014-- Amazon.com, Inc. (NASDAQ: AMZN) today announced that it has reached an agreement to acquire Twitch Interactive, Inc., the leading live video platform for gamers. In July, more than 55 million unique visitors viewed more than 15 billion minutes of content on Twitch produced by more than 1 million broadcasters, including individual gamers, pro players, publishers, developers, media outlets, conventions and stadium-filling esports organizations.
“Broadcasting and watching gameplay is a global phenomenon and Twitch has built a platform that brings together tens of millions of people who watch billions of minutes of games each month – from The International, to breaking the world record for Mario, to gaming conferences like E3. And, amazingly, Twitch is only three years old,” said Jeff Bezos, founder and CEO of Amazon.com. “Like Twitch, we obsess over customers and like to think differently, and we look forward to learning from them and helping them move even faster to build new services for the gaming community.”
“Amazon and Twitch optimize for our customers first and are both believers in the future of gaming,” said Twitch CEO Emmett Shear. “Being part of Amazon will let us do even more for our community. We will be able to create tools and services faster than we could have independently. This change will mean great things for our community, and will let us bring Twitch to even more people around the world.”
Twitch launched in June 2011 to focus exclusively on live video for gamers. Under the terms of the agreement, which has been approved by Twitch’s shareholders, Amazon will acquire all of the outstanding shares of Twitch for approximately $970 million in cash, as adjusted for the assumption of options and other items. Subject to customary closing conditions, the acquisition is expected to close in the second half of 2014.
Update #3: A very interesting post by The Information has outlined the reasoning behind the Amazon deal and, more specifically, why Twitch's deal with Google broke down. As you'd expect, it was about two things: money and control (power):
As the weeks went by, it became clear to the YouTube team that Twitch, with its big ambitions, had growing concerns about its ability to be remain nimble and relatively independent within YouTube. A couple of “integration meetings” between Twitch and YouTube’s product and engineering teams were then canceled. Six weeks after the term sheet was signed, the deal was basically dead.
After the deal broke down, Twitch's investment partners began seeking out new options - Amazon emerged as the most prominent bidder and promised to keep Twitch independent.
We chose Amazon because they believe in our community, they share our values and long-term vision, and they want to help us get there faster. We’re keeping most everything the same: our office, our employees, our brand, and most importantly our independence. But with Amazon’s support we’ll have the resources to bring you an even better Twitch.
So that's that.
There's not much to this one other than what The Information is currently reporting, but the publication is alleging that after a seemingly sealed deal with Google, Twitch is in late stage talks to be acquired by Amazon. Yikes.
The Google acquisition had been rumored for months, and was allegedly accepted by Twitch back in May, with VentureBeat later reporting in June that the transaction had "gone through" and an official announcement was merely a matter of time. Not so much, it seems.
Why Amazon would want Twitch isn't clear. The company has no messaging or social platforms, no live video or UGC services, and has never been closely associated with the gaming industry. Aside from, you know, selling video games... and cat food. And shoes. And power tools.
Amazon and Twitch would not provide comment to The Information on the acquisition, though a person with knowledge of the deal said it could be announced "shortly."