Why Microsoft paid untold millions to bring the world's most well-known gamer, Ninja, to its own streaming platform

YouTube/Tyler Blevins

Tyler "Ninja" Blevins announced his move to Microsoft's Mixer in a video intended to look like a press conference.

• In early August, a landmark deal was announced: The world's most well-known streamer, Tyler "Ninja" Blevins, signed a deal to move from Amazon's Twitch streaming platform to Microsoft's Mixer streaming platform.
• No price on the deal was announced, and it's impossible to know what Blevins received - the deal is literally unprecedented.
• Whatever Microsoft paid for Blevins is assuredly less than it expects to reap from the benefits of his exclusivity.
• "It's hard to put a price on it," Nielsen head of games Joost van Dreunen told Business Insider. "But the value that someone like that creates can run it up to hundreds of millions, if not billions."
• Visit Business Insider's homepage for more stories.

In a fake press conference in early August, Tyler "Ninja" Blevins announced his intention to switch from Amazon-owned Twitch to Microsoft-owned Mixer.

"I know this may come as a shock to many of you," he says, "but, as of today, I will be streaming exclusively on Mixer."

Complimentary Tech Event

Transform talent with learning that works

Capability development is critical for businesses who want to push the envelope of innovation.Discover how business leaders are strategizing around building talent capabilities and empowering employee transformation.Know More

The announcement itself was lighthearted and silly, but the news was anything but - the world's most popular, well-known video game streamer was switching from Amazon to Microsoft. We're talking about a guy who makes hundreds of thousands of dollars each month streaming himself playing "Fortnite" to tens of thousands of viewers, a guy who was reportedly paid $1 million for a single day of playing EA's "Apex Legends."

With those kinds of numbers being thrown around, it's easy to start imagining Microsoft shelling out tens of millions to Blevins for his exclusivity.

Reuters

Time celebrates its annual list of the 100 most influential people in the world, in New York.

That may very well be the case, but it's impossible to know: Neither Microsoft nor Blevins is saying. His wife Jessica Blevins isn't saying either.

"Money was the last thing on our mind," she told Business Insider in an interview published this week.

Moreover, it's a completely unprecedented move in the world of video game streaming, just like Blevins is a completely unprecedented star in that world.

"It's so disproportionate when it comes to spending and the amount of audience someone like Tyler Blevins attracts," Neilsen head of games Joost van Dreunen told Business Insider in a recent phone interview. "There's absolutely no way say, 'Oh [Microsoft] paid 10 or 20 million. It could be either of those."

It could also be more than that or less. What's clear is that the price was assuredly high, but Microsoft expects to recoup whatever it paid many times over.

Read more: Electronic Arts took a huge gamble by paying the world's most popular gamer $1 million to play its new game for a day. Here's why it was worth every penny

"The value that someone like that creates can run it up to hundreds of millions, if not billions," Van Dreunen said.

On paper, the deal looks straightforward: Microsoft is paying the most popular video game streamer to exclusively stream on its platform, Mixer.

In reality, Microsoft is locking in an important influencer who can both increase the value of Mixer and bring eyes to Microsoft's entire gaming platform - a platform that's expanding greatly in the next year with a new Xbox console ("Project Scarlett") and a major new game streaming platform.

Casey Rodgers/Invision/AP

Microsoft's Xbox leader Phil Spencer detailed "Project Scarlett," the next Xbox, during a press briefing in June 2019.

"It's sort of like a linchpin for a much broader strategy around interactive content and entertainment," Van Dreunen said. "Within that context, having celebrity gamers makes sense, right? Then all of a sudden it becomes worth a lot more than whatever they paid."

In so many words, the exclusivity deal with Blevins likely cost a lot - not unlike Microsoft's very expensive acquisition of the game "Minecraft" - but it's part of a bigger strategy that will pay dividends down the road. Not only does Blevins bring attention to Mixer, but he helps endear an entire generation to Microsoft's gaming platforms: Mixer, Xbox, and Windows 10.