YouTube's game streaming challenge

Google first announced that it would launch YouTube Gaming early this summer, ahead of the industry's big Electronic Entertainment Expo trade show. Photo / Getty

YouTube stepped into the world of game-streaming Wednesday with the official launch of YouTube Gaming — its answer to Amazon's popular Twitch.

The new section of YouTube allows gaming companies and everyday gamers to share live or recorded videos about the games of the moment. It also gives YouTube an official home for video game content as the business of watching other people play video games grows.

Google first announced that it would launch YouTube Gaming early this summer, ahead of the industry's big Electronic Entertainment Expo trade show, known widely as E3. The debut comes a year after Google lost a bidding war with Amazon to buy Twitch, the web's current leader in video-game streaming. Amazon bought Twitch last August for nearly $1 billion. (Amazon chief executive Jeffrey P Bezos is the owner of The Washington Post.)

Twitch is Google's main competition here. But YouTube isn't starting from scratch: It already has a huge amount of gaming content across its site. The company says that the time its users spend with gaming videos is up 75 per cent in the past year. ZEFR, a technology firm that crunches YouTube data, estimates that videos from the walkthrough genre of what is known as a "Let's Play" have garnered 40 billion views in the lifetime of YouTube.

ZEFR also reports that several top game-related searches on YouTube, such as "gaming news" and "general gaming," have doubled in the past eight months.

Creating YouTube Gaming gives advertisers a simple way to reach the much-coveted video game audience, says a marketing expert. Photo / Getty

Analysts have looked to YouTube as one of Google's most valuable offerings, helped by its broad audience. The company is tight-lipped about offering specifics on YouTube views, but did say that, in 2013, people watched 6 billion hours of video on the site. It's safe to assume that the total has increased in the past two years, said Pivotal Research Group analyst Brian Wieser in a note to investors last month.

The key for YouTube, Wieser said in the note, will be to turn that scale into money.

"It may be that YouTube's business model might be superior if it can limit what it spends on content while continually pushing advertisers to redefine what 'premium' is to better match what YouTube can inexpensively supply," he wrote.

Creating YouTube Gaming gives advertisers a simple way to reach the much-coveted video game audience, said Dave Rosner, senior vice president of marketing for ZEFR. "In the last 10 years, advertisers have really come to understand the value of this audience and take it seriously," he said.

As for the competition, Twitch essentially said "bring it on" in a statement Tuesday night — without mentioning its new competitor by name.

"The opportunity in gaming video is enormous, and others have clearly taken notice," the statement said. But Twitch also highlighted its biggest strength: an existing, dedicated fan base that is set to join in with the company at its first-ever convention in late September.

"We have a very ambitious and long-term product road map, some of which will be revealed in the coming weeks and months, particularly at TwitchCon," the statement said.