Hacker News Board Hacker News, browsed like a classic message board
Live data from Hacker News

Twitch to Cut 500 Employees, About 35% of Staff

bloomberg.com

Post reply on HN
Print view View original

101–110 of 482 posts

Re: Twitch to Cut 500 Employees, About 35% of Staff

#101

Post by anonylizard »

londons_explore wrote: post #78
asdfasdflkj211 wrote: post #26

Earlier quoted context omitted.

You answered your own question. Twitch is solid and well-built. It doesn't need an army of well-paid engineers to maintain it and isn't seeing a great ROI on new features. Some companies repurpose all, many or some engineers when the spreadsheet says to, others fire them wholesale.

Not many people realise this. Engineers build stuff. When your product is feature complete, you can get rid of most of them. Big tech companies keeping tens of thousands of engineers on staff despite their core product not seeing substantial changes for years are just wasting money.

Most tech products are not well engineered, they are riddled with tech debt as per typical advice. So when a product does succeed, it is usually limping along racing to add features and handle great load while being knee deep in (already) legacy code.

This is all fine and expected, you sacrifice engineering quality for development speed in the early days. Just expect to pay it back by keeping a large engineering team for many years to come, or see your entire tech explode in flames.

Those 'years' are finite however, Twitch has been mature for like a decade already. So finally the tech debt is all paid off, and given failure to develop major successful features, time to cut the staff.

Re: Twitch to Cut 500 Employees, About 35% of Staff

#102

Post by dogprez »

londons_explore wrote: post #78
asdfasdflkj211 wrote: post #26

Earlier quoted context omitted.

You answered your own question. Twitch is solid and well-built. It doesn't need an army of well-paid engineers to maintain it and isn't seeing a great ROI on new features. Some companies repurpose all, many or some engineers when the spreadsheet says to, others fire them wholesale.

Not many people realise this. Engineers build stuff. When your product is feature complete, you can get rid of most of them. Big tech companies keeping tens of thousands of engineers on staff despite their core product not seeing substantial changes for years are just wasting money.

It's not a complete waste, every engineer you employ is one you don't have to compete with, which matters for big tech companies. Also, employed engineers can be mobilized to react to threats/emergencies. It's just a matter of time before they will be needed. If you are running a ghost ship, will you be able to scale up a response when needed? If the company is just being fleeced, then the answer is "who cares?" I guess.

Re: Twitch to Cut 500 Employees, About 35% of Staff

#103

Post by thot_experiment »

_jal wrote: post #55
thot_experiment wrote: post #29

Earlier quoted context omitted.

Sell your soul. You have to be capable of looking at people and erasing their humanity/removing your empathy.

Necessary but not sufficient. Also, don't confuse empathy and sympathy - you need to extinguish the latter, but the former is incredibly important to your ability to play suckers.

I think you might have them backwards? Empathy is the one where you viscerally feel the other person, sympathy is where you can simulate what they're feeling but without that deeper connection, or at least that's how I was taught it.

Re: Twitch to Cut 500 Employees, About 35% of Staff

#104

Post by wnevets »

lchengify wrote: post #92

Not mentioned in the article but definitely the elephant in the room: The rise of TikTok streaming [1] TikTok doesn't focus on gamers, but attention is finite. TikTok surpassed Twitch a while ago in revenue and it's accelerated since then. TikTok + Youtube (very profitable) makes Twitch at best a flat third place. Not a great business to be in when ZIRP ends. > Nine years after Amazon’s acquisition of the company, th…

How is it possible for them not to be profitable? Don't they take a 50% cut on subs?

Re: Twitch to Cut 500 Employees, About 35% of Staff

#105

Post by no_wizard »

zztop44 wrote: post #91
no_wizard wrote: post #22

Earlier quoted context omitted.

Wouldn't the work around then be for Twitch to do a 49-51 split with a South Korean ISP to get favortism? These entrenchment laws are there to favor the big ISPs in SK, it would stand to reason that they would be happy to make money in such an arrangement, and Twitch gets a secondary downstream benefits that they can reap.

There’s a good chance someone already had this idea, explored it, and found a reason why it can’t work.

I'm not so sure. Amazon doesn't have a history of doing this sort of thing, I don't know that its in their DNA.

I'm willing to bet there was no real diligence to an idea like this as a result. I was of course postulating myself (and don't know the inner details of Twitch either) however, upon thinking about it further, it seems unlikely it was ever seriously entertained, if at all.

Re: Twitch to Cut 500 Employees, About 35% of Staff

#106

Post by stefan_ »

bitmasher9 wrote: post #46
raz32dust wrote: post #19

I don't get it. From an outside perspective, it feels like they must be raking in the cash - they take a large cut from subscribers and the number of ads is crazy. Viewership growth seems good [1]. The product seems solid and well-built. The demand is clearly there. Serving live video is obviously expensive, but curious if that is really the biggest component (other than personnel). Would be cool if some industry ins…

1. I think the infrastructure costs is probably more than you think. It’s probably the single biggest line item. They have to encode every video stream to multiple formats, and then deliver it globally. 2. The core product is pretty mature. 3. Elon raised the bar for how large of a staff cut you can make. 4. Most of their revenue is split with content creators. 5. They lost their CEO about a year ago. New guy has to…

The infrastructure is bought from Amazon, who in turn own them. Makes you wonder if it’s actually unprofitable, on the whole.

Re: Twitch to Cut 500 Employees, About 35% of Staff

#107

Post by nine_zeros »

wnevets wrote: post #104
lchengify wrote: post #92

Not mentioned in the article but definitely the elephant in the room: The rise of TikTok streaming [1] TikTok doesn't focus on gamers, but attention is finite. TikTok surpassed Twitch a while ago in revenue and it's accelerated since then. TikTok + Youtube (very profitable) makes Twitch at best a flat third place. Not a great business to be in when ZIRP ends. > Nine years after Amazon’s acquisition of the company, th…

How is it possible for them not to be profitable? Don't they take a 50% cut on subs?

By spending too much on their execs

Re: Twitch to Cut 500 Employees, About 35% of Staff

#108

Post by hot_gril »

lchengify wrote: post #92

Not mentioned in the article but definitely the elephant in the room: The rise of TikTok streaming [1] TikTok doesn't focus on gamers, but attention is finite. TikTok surpassed Twitch a while ago in revenue and it's accelerated since then. TikTok + Youtube (very profitable) makes Twitch at best a flat third place. Not a great business to be in when ZIRP ends. > Nine years after Amazon’s acquisition of the company, th…

I imagine live video is a lot more expensive too. Can't just throw that on a CDN. And unlike YT or TikTok videos with sort of a time limit, Twitch streams can run for hours, chewing up bandwidth while so many "viewers" are giving divided attention at best.

Re: Twitch to Cut 500 Employees, About 35% of Staff

#109

Post by lchengify »

wnevets wrote: post #104
lchengify wrote: post #92

Not mentioned in the article but definitely the elephant in the room: The rise of TikTok streaming [1] TikTok doesn't focus on gamers, but attention is finite. TikTok surpassed Twitch a while ago in revenue and it's accelerated since then. TikTok + Youtube (very profitable) makes Twitch at best a flat third place. Not a great business to be in when ZIRP ends. > Nine years after Amazon’s acquisition of the company, th…

How is it possible for them not to be profitable? Don't they take a 50% cut on subs?

I am supremely curious about this myself.

My guess would be their ad spend is bad in comparison to the other networks (Google, Facebook, TikTok). Could be because their audience isn't worth as much, could be because the ad formats are bad, could be because they can't get advertisers. But unless they are serving ads from Google's network, my guess is they are 4th place at best.

As noted on other threads, their streaming infrastructure must be a burning dumpster fire of money. Live streaming is super hard since you can't edge cache it, and it requires actual hard computer engineering to make work. If a mere mortal company were to try to run a clone of Twitch on AWS, it would run out of money in days. It also likely uses the same hardware as other high-value products, such as AI.

Re: Twitch to Cut 500 Employees, About 35% of Staff

#110

Post by mullingitover »

niceice wrote: post #39
minimaxir wrote: post #24

Earlier quoted context omitted.

Even in late-stage capitalism, you do a 5-10% staff cut at most to trim the fat so-to-speak. A 35% cut indicates something with the business is fundamentally wrong. EDIT: I apologize for the completely unintentional derail.

What's "late-stage capitalism"?

You'll get a lot of answers, but I think The Tendency of the Rate of Profit to Fall[1] is key.

Capitalism means competition. Competitors mean reduced profits. As we get into the later stages of the game, that pesky competition aspect comes into play and firms do whatever they can to worm their way out of its consequences.

As profits inevitably fall, firms flail around doing whatever they can to maintain them and cause all sorts of misery for employees, customers, and the world at large. Increasingly brutal exploitation of workers, rotting product quality, all sorts of shenanigans with regulatory capture and rent-seeking as firms try to avoid competition and the need to sell a quality product at a competitive price.

[1] https://en.wikipedia.org/wiki/Tendency_of_the_rate_of_profit...

Post reply on HN