Amazon buys Twitch for $1 billion

Amazon will spend nearly $1 billion for the video-sharing platform Twitch.

While it may seem strange to pay such a large sum to share videos when there are so many different ways to do just that via social media like Instagram and Twitter, or even just a message from one cell phone to another, Twitch has one key distinction that separates it from the rest.

That key distinction is the fact that Twitch is used for the recording and sharing of video games. While watching video games may seem like a foreign concept to people in the United States, it is already well established in East Asian countries such as South Korea and Japan.

Bloomberg reports that the price paid for Twitch itself was $970 million but payouts and other costs will bring the total closer to $1.1 billion. Twitch has around 55 million users who are active every month.

In markets where watching video games is an established pratice, matches of games like the strategy-filled StarCraft and first person shooter Halo are broadcast live. The broadcasts attract millions of viewers.

Another Bloomburg report shows that analysts expect the hours of video game viewership to grow enormously. In 2013, people around the world watched a total of 2.4 billion hours of gameplay. That figure is expected to reach more than 6.5 billion by 2018.

The report also says that Twitch users spent around 4.5 hours on the site in July. That closely trails YouTube's 6 hours a month, according to Bloomberg.

Attributing to that rise is the fact Twitch is now included standard in game consoles such as the PlayStation 4. Professional and casual gamers alike can now record their gameplay and share their greatest triumphs with friends and family on social media.

Google had previously begun talks to acquire Twitch for around $1 billion