It was five years ago that Netflix announced that it was breaking into video games, and it has been a nonstop whirlwind for the company ever since then. Netflix’s ever-changing gaming strategy put it in a perpetual state of start-and-stop momentum. The breakneck pivots have now culminated in more drastic changes, as the tech giant announced this week that it is shutting down two of its studios: Night School Studio and Moonloot. The former is the acclaimed developer behind Oxenfree, which Netflix acquired in 2021 as part of its initial gaming push. It just released a new game, Unhinged, via Netflix on June 30. Moonlight never launched a game at all under the company’s ownership.
Strangely enough, the move comes at a moment when Netflix feels more invested than ever in making video games work. The last year has seen the company bring games straight into the Netflix app, experimenting with its mobile controller, and scoring a major partnership with FIFA just in time for the World Cup. An upcoming Grand Theft Auto 6 presentation, which will debut exclusively on Netflix, further signals that the streaming service is fighting for gamers’ attention.
So, why shut down two studios at such a crucial juncture? Looking at Netflix Games’ full five-year trajectory, including its unexpectedly busy last few months, will give you a good idea of what direction Netflix is headed in next as it struggles to nail down its niche in a competitive space.
Netflix’s gaming initiative didn’t have the most ambitious origins in 2021. The platform kicked off its plans by adding five games to the platform: Stranger Things 3: The Game, Stranger Things: 1984, Shooting Hoops, Card Blast, and Teeter Up. It wasn’t the most impressive lineup, signaling that Netflix’s immediate sights were set on casual players and fans of its big-ticket franchises. But its acquisition of Night School, an indie darling riding high off the critical success of Oxenfree, suggested that Netflix had its eyes set on prestige down the road.
That pivot began to materialize in 2022. That year, Netflix began launching high-touch mobile games like Poinpy and Desta: The Memories Between, which enjoyed some buzz from the gaming press. That strategy was bolstered when Netflix began dropping mobile ports of critically acclaimed indie games through Netflix; Intro the Breach, Immortality, Before Your Eyes, and more made their way to the platform by the end of the year. A voice was starting to take shape.
For the next two years, Netflix doubled down on its image as a home for award-winning games. Night School launched Oxenfree 2: Lost Signals, Alto’s Odyssey developer Snowman released the excellent Laya’s Horizon, and Yacht Club Games brought Shovel Knight: Pocket Dungeon to mobile via Netflix. More critical darlings, like Hades and The Curse of the Golden Idol, joined Netflix’s growing library. A busy year was capped off by the company’s biggest move to date: bringing Grand Theft Auto: The Trilogy – The Definitive Edition to the service at the end of 2023.
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