Netflix Steps Up Its 'Game' With Acquisition Of 'Oxenfree' Developer: What You Should Know

Streaming giant Netflix Inc (NASDAQ: NFLX) has bought game developer Night School Studio for an undisclosed amount.

What Happened: The Glendale, California-based studio is known for storytelling in games. 

Founded by Sean Krankel and Adam Hines in 2014, Night School Studio launched the popular supernatural mystery adventure Oxenfree, with which it made its debut in 2016. 

“We’re in the early stages of creating a great gaming experience for our members around the world. So we’re excited to announce today Night School Studio is joining Netflix,” Mike Verdu, VP, Game Development at Netflix said in a statement. 

Verdu, a former Electronics Arts Inc (NASDAQ: EA) and Facebook Inc (NASDAQ: FB) gaming executive who recently joined Netflix to lead the streaming giant’s expansion into video games, said the company plans to make games a part of its subscription, with no ads or in-app purchases. 

Verdu said the company will expand its game efforts through a combination of working with established developers, as well as, making new hires.

See Also: Netflix Hires Former EA, Facebook Exec As It's Said To Plan Expansion To Video Games

“Our explorations in narrative gameplay and Netflix’s track record of supporting diverse storytellers was such a natural pairing. It felt like both teams came to this conclusion instinctively,” Night School Studio founder Krankel said.

Krankel said Night School Studio will continue working on the second edition of its popular game named Oxenfree II: Lost Signals for the Switch.

Why It Matters: Netflix’s latest buy is a firm first step towards building a robust video-gaming portfolio, which would be an alternative source of revenue amid a slowing subscriber growth and rising competition in the video streaming space. 

Netflix said in July in its quarterly letter to shareholders that it sees gaming as another "new content category" for the company, similar to its expansion into original films, animation and unscripted TV.

See Also: Netflix Launches Mobile Games In Europe, Steaming Up Rivalry With Disney+, HBO Max

Netflix has previously partnered with an outside developer to launch a game themed on its “Stranger Things” franchise. With its own gaming platform, the company could create games around its owned properties and original series besides drawing in millions of new young subscribers who are hooked to gaming.

Price Action: Netflix shares closed 1.48% lower at $583.85 a share and were up 0.11% in after-hours trading.