YouTube to Acquire Videogame-Streaming Service Twitch for $1 Billion: Sources

Google’s YouTube has reached a deal to buy Twitch, a popular videogame-streaming company, for more than $1 billion, according to sources familiar with the pact.

The deal, in an all-cash offer, is expected to be announced imminently, sources said. If completed the acquisition would be the most significant in the history of YouTube, which Google acquired in 2006 for $1.65 billion. The impending acquisition comes after longtime Google ad exec Susan Wojcicki was named CEO of YouTube earlier this year.

Reps for YouTube and Twitch declined to comment.

San Francisco-based Twitch lets users upload and watch free, live gameplay videos that can be streamed from Microsoft Xbox and PlayStation 4 consoles. The company claims to have more than 45 million monthly users, with more than 1 million members who upload videos each month. It also has deals to distribute shows from partners including CBS Interactive’s GameSpot, Joystiq and Destructoid.

Gameplay videos already are a highly popular category on YouTube. Other players in the videogame-entertainment market include tournament organizer Major League Gaming, a New York-based company whose investors include Oak Investment Partners and Relativity Media CEO Ryan Cavanaugh.

In March 2014, Twitch represented 1.35% of all downstream bandwidth on North American fixed-access broadband networks — nearly triple from last fall, according to bandwidth-equipmentcompany Sandvine.