When the “live streaming” service Justin.tv initially found success in 2007, it was through a strong value proposition, driven by the three stages of “fit”.
The problem was creators wanted a way to share live digital content with viewers. Viewers wanted a better way to interact with their content creators. Everyone involved wanted an easily accessible, digital platform to accomplish this.
Justin.tv tested their concept and found gradual success through experimentation during the early years of “live streaming”. YouTube, Dailymotion, and Crunchyroll had already proven successful as purely digital streaming content platforms.
Business Model Fit
Justin.tv had proprietary software that brought the cost of delivering an hour of video down to half a penny, cheap enough to serve constant video to a mass audience as an ad-supported business (Andrew Rice).
What become the long-term issue for Justin.tv was brand positioning. At its inception, Justin.tv fulfilled a unique consumer problem. After a very short period of time, other platforms were solving the same problem. They were also providing more unique partnerships with existing intellectual properties, while Justin.tv was struggling to deal with copyright infringement.
As Justin.tv lost its brand positioning, it started to lose viewers and, therefore, growth. Justin.tv, like most platforms, had several categories viewers could browse to find content. After utilizing data analytics on their audience, the internal Justin.tv team realized that their highest viewership, and viewers most likely to engage, were watching content almost exclusively in the “Gaming” category. With this in mind, Justin.tv moved the gaming category to an entirely new site name “Twitch”.
When Justin.tv created Twitch, they cemented their brand position as the primary digital platform to watch and engage with professional video game players and experience live gaming events in real-time. No other platform was 100% dedicated to gamers and no other platform welcomed both professional and amateur gamers to stream their content live. Twitch became an instant hit with viewership of large events initially competing with the likes of traditional leagues such as the MLS and NHL. Today, Twitch events have hit upwards of 100 million viewers (Kevein Webb) with an estimated total audience of 495 million viewers (Roundhill Team).