Amazon was secretly trying to compete with Steam from the shadows

Amazon spent more than 15 years secretly trying to 'disrupt the game platform Steam,' but failed as it was never able to crack the code.

Amazon was secretly trying to compete with Steam from the shadows
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Tech and Science Editor
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TL;DR: Amazon Games faced major layoffs amid a strategic shift from MMOs to its Luna cloud gaming platform after repeated failures to challenge Steam's dominance. Despite vast resources and acquisitions like Twitch and Reflexive Entertainment, Amazon couldn't replicate Steam's integrated gaming ecosystem, leading to its ongoing struggles.

The crumbling of Amazon Games has revealed some interesting insider information about what the company was developing before it was hit with the recently announced widespread layoffs and studio closures.

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For those who aren't caught up, Amazon Games announced major layoffs as it switches its focus away from MMOs to its Luna cloud gaming platform. According to the announcement, 14,000 employees were laid off from Amazon, and of those, an unknown number will be let go from Amazon Games and its studios. What is known is that Amazon Games will be hit quite hard by the layoffs, following the publisher's dismal track record of game releases and failed projects.

It was back in February of this year that we heard about Amazon's ultimate goal, and that was to compete with Steam, and it believed it could since it was far larger than Valve and possessed more resources. This revelation came from Ethan Evans, who was the former Vice President of Prime Gaming at Amazon until 2020, who wrote on LinkedIn that despite being 250x the size of Valve, Amazon was unable to crack the code.

Amazon has attempted to snatch the crown from Valve a few times, with the first being the Reflexive Entertainment online store in 2009, which failed, then integrating a store into Twitch, which failed, and then releasing the cloud-gaming app Luna, which hasn't gained much attention, but is what Amazon is now putting more eggs into the proverbial basket.

"As VP of Prime Gaming at Amazon, we failed multiple times to disrupt the game platform Steam. We were at least 250x bigger, and we tried everything. But ultimately, Goliath lost. Here's why:

The 15+ year long attempt to challenge Steam started before I was VP of Prime Gaming, but we never cracked the code. Not under my leadership or anyone else's. The first way we tried to enter the online-game-store market was through acquisition. We acquired Reflexive Entertainment (a small PC game store) and tried to scale it. It went nowhere.

Then, after buying Twitch, we created our own PC games store. Our assumption was that gamers would naturally buy from us because they were already using Twitch. Wrong. Finally, we built "Luna," a game streaming service that let people play without a high-end PC. Around the same time, Google tried the same thing with their product "Stadia." Neither gained significant traction.

The whole time, Steam dominated despite being a relatively small company (compared to Amazon and Google). The mistake was that we underestimated what made consumers use Steam. It was a store, a social network, a library, and a trophy case all-in-one. And it worked well," writes Ethan Evans