This past August, Netflix closed its internal game studios, Night School Studio and Moonloot Games.

Founded in 2014, Night School made waves as the developer behind 'Oxenfree' and as Netflix's first game studio acquisition. Night School's final project, 'Unhinged,' drew major attention for being produced by David Fincher and Zach Cregger, with voice performances by Zoë Kravitz, Sadie Sink, and Troy Baker.

Netflix itself actively voiced high expectations for 'Unhinged' around its release. During its July earnings call, Netflix Co-CEO Greg Peters specifically mentioned the game title, stating it recorded solid numbers. Yet the high-profile studio that developed the title was shut down—just six weeks after 'Unhinged' launched on June 30. This signals that the closure was not simply a case of poor performance.

At the same time, Netflix exclusively revealed new footage of Rockstar Games' 'GTA 6' six hours ahead of YouTube. While Netflix has previously streamed live sports events and its own fan showcase Tudum, this was the first time a game reveal took center stage on the platform. The broadcast garnered 31.1 million views, placing it among the top-tier performances across all Netflix content.

On one side, it shuttered internal studios; on the other, it spent millions to acquire hype around someone else's game. Looking at these two decisions side by side reveals where Netflix's attitude toward gaming is heading.

On August 28 KST, Netflix released 'GTA 6: An Extended Look,' featuring gameplay footage from Rockstar Games, on its platform. Captured on PlayStation 5, the roughly 27-minute video delivered the impressive gameplay and direction that fans had been anticipating.

Netflix's move was highly unusual. Although Netflix has hosted various live events—including its Tudum fan showcase, the NFL, WWE, and the SAG Awards—this was essentially its first event dedicated to showing an actual video game. Attention was especially high given that this was effectively the first full gameplay reveal for GTA 6, a title expected to exert massive influence not only on game fans but across the broader U.S. entertainment industry.

As a result, analysts noted that the outcome of this broadcast could shape the future role of streaming platforms and open up possibilities for diversifying platform strategies beyond traditional YouTube-based game reveals. This was particularly true because the footage was exclusive for only six hours before its YouTube release, and Netflix permitted creators to re-use the video immediately upon its broadcast—meaning Netflix merely held the title of 'official source' for a brief window.

Strictly in terms of performance, Netflix gained practical benefits. According to Netflix's internal metrics released on the 2nd, the GTA 6 video reached 31.1 million views, taking the #1 spot in the English-language film category. It also ranked #1 in 87 out of the 93 countries tracked. Considering that top English films typically log weekly figures between 12 million and 25 million views in the same timeframe, this was a top-tier result. In particular, analysis from market research firm Sensor Tower revealed that at the time of release, Netflix's mobile app usage in the U.S. jumped roughly 50% above baseline, while web usage spiked by over 125%.

However, the picture changes when compared against GTA 6's own standalone benchmarks without Netflix's involvement. The first trailer, released in December 2023, garnered 93 million views in 24 hours on YouTube alone, setting a new 24-hour YouTube record for a non-music video at the time. The second trailer, released in May 2025, was distributed across multiple platforms simultaneously and registered 475 million views in 24 hours, standing as the largest video reveal in history. Compared to these figures, 31.1 million is败 undeniably a modest number.

While it cannot be confirmed whether Netflix paid for the reveal or if Rockstar Games paid Netflix, industry consensus suggests Netflix likely paid Take-Two for the exclusive stream based on relative leverage. In particular, estimates often cite Tom Henderson of Insider Gaming; if Netflix indeed invested $100 million based on his claim, it spent a high cost of roughly $3.20 per view.

These numbers imply that Netflix's goal was not simply maximum audience reach, as previous videos released for free on YouTube achieved far higher view counts. Yet this does not mean Netflix failed. Even if it spent $100 million, that amount is less than a third—or at least less than half—the budget of Netflix's most expensive blockbuster films. From Netflix's perspective, it achieved a satisfying metric without bearing a heavy production burden.

Furthermore, Netflix shared in the massive attention that otherwise would have been focused solely on GTA 6. In essence, Netflix purchased the right to place GTA 6's guaranteed cultural clout on top of its own brand for six hours.

While Netflix achieved strong results with its six-hour exclusivity window for GTA 6, its own gaming division has been heading in the opposite direction.

Netflix's serious gaming expansion began in 2021 with the hiring of Mike Verdu, formerly of EA, Zynga, and Oculus, as VP of game development. Verdu's first task was building a framework for game development and publishing. Night School Studio was acquired during this period alongside several other studios, and over the following years, Netflix's cumulative catalog expanded to over 100 games.

Though praised as an outstanding leader by developers who worked with him at EA and Zynga, such as Colleen McCreary and Gary Cox, he produced little tangible success. Just a few years later, Netflix's game studios entered a phase of downsizing. Team Blue—which had brought on former Overwatch executive producer Chacko Sonny and Halo creative lead Joseph Staten—closed in 2024. Boss Fight Entertainment, developer of a game based on Squid Game, followed in 2025. With Night School Studio and Moonloot Games closing in 2026, the number of internal studios owned by Netflix has dwindled to just one: Next Games.

Leadership changes aligned with this shift. In July 2024, Netflix brought in Alain Tascan, who had overseen first-party game development and live services like Fortnite, Rocket League, and Fall Guys at Epic Games. Studio cutbacks continued under his leadership.

What makes Netflix's studio downsizing peculiar is that it was not solely a matter of poor performance. Boss Fight's 'Squid Game: Unleashed' hit #1 on the App Store in 26 countries after launch, achieving commercial success. And unlike 'Squid Game: Unleashed,' which received harsh reviews for its overall quality, 'Unhinged' earned relatively better praise. While its short 30-minute playtime drew criticism, it received acclaim for its lead actors' performances and was noted for demonstrating the potential of Netflix's interactive content. Studios that delivered positive results were closed shortly thereafter.

Regarding the studio closures, Netflix explained that realignment allows it to re-prioritize company goals and restructure to focus more sharply on key business areas. The areas Netflix identified for focus include party games, kids' games, narrative-driven games, and games with broad mainstream appeal like FIFA World Cup developed by Refactor Games.

Yet at the same time, the FIFA World Cup game, 'FIFA World Cup: Launch Edition,' was panned for its lack of polish. This highlights the irony of shutting down the developer of 'Unhinged'—a title Netflix hailed as one of its most successful debuts—only to point to the FIFA World Cup game as a primary example.

This dynamic reveals a fundamental shift in how Netflix views video games.

The roots of Netflix's gaming initiative trace back to the December 2018 release of the interactive movie 'Black Mirror: Bandersnatch' and tie-in games for 'Stranger Things'. From there, Netflix progressed to hosting and offering games through its own internal studios.

Some observers viewed these moves as an attempt to find an alternative growth vector in gaming as streaming growth plateaued and competition intensified. In practice, however, there is little evidence that Netflix's actual user base responded significantly to this strategy.

Market research firm Omdia noted in an analysis that despite four years of operation, Netflix mobile games increased user watch time by just 0.5%. This was not merely due to a lack of awareness of Netflix's gaming offerings. In a 2023 Morning Consult survey, 17% of U.S. adults said they had heard 'some' or 'a lot' about Netflix's game service. By 2025, Statista data showed brand awareness for Netflix Games among U.S. subscription services ranked 5th at 55%—higher than PC Game Pass, Apple Arcade, EA Play, Ubisoft+, Amazon Luna, and GeForce NOW, trailing only Xbox Game Pass, PlayStation Plus, Google Play Pass, and Xbox Game Pass Core.

Although the data comes from different research firms, it indicates that despite rising awareness and an expanding catalog, gaming failed to produce meaningful gains in streaming watch time—the core metric of Netflix's business.

Compounding this issue, gamers typically concentrate their time on just 5 to 10 games per year. Netflix's subscription model, by contrast, is optimized for broad, varied consumption across a wide library. Deep engagement with a single game operates on a fundamentally different consumption pattern than seeking out new video content weekly, making them difficult to bundle into the same product. Without AAA games that offer deep, long-term satisfaction like those on Xbox Game Pass, relying on mobile-focused studios proved ineffective.

Furthermore, Netflix itself has never explicitly stated an intention to compete directly within the games industry as a pure games maker. The common perception that Netflix viewed gaming as a direct rival stems from comments by former CEO Reed Hastings during a 2019 earnings call. At the time, he named Xbox, Fortnite, YouTube, and HBO as competitors—meaning companies competing for user screen time, rather than video game companies per se. Even then, Netflix's stance was to compete through ad-free, on-demand quality content rather than by making games to challenge them head-on.

Nor could Netflix easily replicate Amazon's strategy of bundling cloud gaming service Amazon Luna into Amazon Prime, given that Amazon leveraged existing infrastructure like AWS and Fire TV to layer on games.

In this light, Netflix's recent moves resemble a process of walking back its detour into game development and returning to its core strategy.

In 2024, The Wall Street Journal cited industry analysts estimating that Netflix spent roughly $1 billion on studio acquisitions and its broader gaming division. However, it failed to see commensurate results. The peak of Netflix Games actually came from the December 2023 port of 'Grand Theft Auto: San Andreas – The Definitive Edition.' According to metrics compiled in early December 2025, total cumulative game downloads on Netflix reached approximately 396 million. 'GTA: San Andreas' accounted for 57.4 million downloads on its own—roughly one-seventh of the total. 'Civilization VI' also ranked among the top-downloaded titles.

Both were ports of established, proven titles rather than original internal developments. In contrast, original IPs produced by internal studios backed by $1 billion in spending came nowhere near that level of success. What users wanted—or cared about—was not original Netflix-branded games, but familiar, proven titles.

Moving forward, Netflix has shifted its focus further away from games as playable products and toward familiar 'content.' Observers note that comments regarding 'GTA 6: An Extended Look' came from Brandon Riegg, VP of Nonfiction Series, rather than gaming head Alain Tascan. Riegg played a key role in bringing WWE's weekly live broadcasts to Netflix and has overseen Netflix's sports and nonfiction programming, including NFL Christmas Day games and 'Formula 1: Drive to Survive,' the documentary series credited with driving F1's global popularity boost.

Framing the GTA 6 gameplay reveal not merely as a video game, but as 'storytelling' and a 'cultural moment,' reflects this ongoing evolution in Netflix's approach.

Thus, Netflix's current perspective on video games is markedly different from what it was over the past few years. After all, showcasing what games have already built is something Netflix is infinitely better at than making games itself.