Livestreaming giant Twitch is set to announce significant staff cuts with around 500 employees to be axed due to financial pressures.
As reported by Bloomberg, “prohibitively expensive” costs were cited in the recent news that the streaming platform would end its operations in South Korea due to the sheer impact on the balance sheet of doing business in the Far East nation.
Amazon subsidiary Twitch is the most popular live video game streaming platform in the world. It enables interaction between content creators and their audiences and generates around 1.8 billion hours of live content per month.
In December 2023, Twitch CEO Dan Clancy confirmed the decision to pull out of the Korean market with part of the rationale stating costs were 10 times higher than in other territories. That news came in addition to the departure of several top executives at the company including its chief product officer, chief customer officer and chief content officer.
Fears over cuts will be exacerbated by this latest development on job losses which is said to impact 35% of Twitch’s workforce.
The Bloomberg report indicated that Twitch remains unprofitable despite its prominence, nine years after the Amazon acquisition although it has embraced advertising in recent times.
At the parent company, 2022 saw a whopping 27, 000 positions axed in what was thought to be its biggest-ever corporate job axe.
With official news expected as soon as Wednesday, it will put further pressure on Clancy’s shoulders as he aims to plug the losses at Twitch, with financial stress having a direct impact on staff numbers.
He has been seeking to build bridges with his platform’s influencers and personalities who make a living from live streaming, on matters such as the approach to advertising but he is said to be open to listening to the concerns of users.
After 400 job losses last year, a further cut of 500 roles represents a significant blow to Twitch’s operations amid its cost concerns which will make ripples across the vista of the live-streaming industry.
Meanwhile, X owner Elon Musk has said he wants to add new streaming features to his platform to compete directly with Twitch and its rivals.
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