The growth of eSports and gaming has opened up new marketing opportunities throughout the industry. As brands search for new ways to connect with consumers, they’re turning to gaming companies. Since 2019, corporations like BMW, Pizza Hut, and Samsung have announced high-profile partnerships. These partnerships have pushed market revenue to new heights. While many areas of entertainment struggled during the Covid-19 pandemic, gaming has benefited. The market revenue is forecasted to hit $180.1 billion in 2021, up from $162.32 billion in 2020.
The latest deal between Twitch and Warner Music Group may prove to be the most innovative yet. Dubbed the "first of its kind partnership," the pact is a unique collaboration between a major record label and the gaming world. It's the latest collaboration of several 2021 table-setting moves for the gaming industry. Earlier this year, Fortnite partnered with luxury fashion house Balenciaga. The agreement between Twitch and Warner Music Group appears to be a more natural tandem. This is the result of music having a long-standing role in video gaming. In addition, the deal will feature exclusive channels for some WMG artists and a space for music-forward programming on Twitch.
WMG is one of the big three record labels with over 90 record labels and publishing houses. Its most prominent subsidiaries are Warner Chappell Music Publishing, Elektra Records, Reprise Records, Warner Records, and Atlantic Records. The partnership with Twitch will see the launch of WMG artist channels. It's unknown if all signed artists will eventually have their own WMG channel on Twitch. It's been reported that Warner Records' Bella Poarch and Atlantic's Saweetie and Sueco have been highlighted in the label's press communications.
WMG channels are being touted as a constant source of exclusive content and behind-the-scenes footage. Because of this, WGM's artists will be able to take full advantage of Twitch's creator-driven model and increase fan engagement. In the press release announcing the deal, Chief Digital Officer of WMG, Oana Ruxandra, said, "It's clear that Twitch is an indispensable space for all types of creators to connect with their fan communities." Our partnership creates an on-ramp for artists to come onto the service with strong support from Twitch, opening up an entirely new source of incremental revenue."
Twitch is a streaming platform owned by Amazon. In 2020, Twitch had revenue of $2.3 billion and 140 million active monthly users in 2021. The platform will have access to WMG's extensive musical catalog. Twitch also announced that it would allow rights holders to opt into reports of specific uses of their music — with the goal of better accounting for publishing payouts. This benefit will not be exclusive to WMG artists.
Twitch's Vice President and Head of Music, Tracy Chan, said: "Twitch has always been – and will continue to be – creator first. For fans, artists, and all creators, this is a great step forward. Working together, we can create new paradigms and opportunities for artists and the Twitch community, all grounded in the passion of fans."
The music industry may be the biggest benefactor of the Twitch and WMG partnership. A deal of this type has the potential to create a new category and career paths in music, similar to the evolution of music supervision in television and film.
Traditional television has gradually steered away from music content, but Twitch has the viewership to possibly reinvigorate that arena. The platform reported that users watched 5.79 billion hours worth of content in the third quarter of 2021 alone.
In addition to artists channels, WMG and Twitch will launch a series of music-centric programs on the platform:
If you'd like to explore how the worlds of gaming and music can collide, check out Yellowbrick's Ultimate Music Career Guide and Ultimate eSports and Gaming Guide.