Brief:

• Netflix next year will release a mobile video game based on its hit science-fiction horror series "Stranger Things," the streaming company announced in a panel discussion at the E3 gaming conference in Los Angeles. The role-playing game will resemble "Pokémon Go" in combining digital imagery with a player’s physical location based on Google Maps, Mashable reported.
•  Next Games, the Finnish game developer that created a location-based augmented reality (AR) game based on AMC’s "The Walking Dead," is creating the “Stranger Things” game for iOS and Android devices, per an announcement. The game will challenge players to solve puzzles and work with other fans to fight evil forces from the Upside Down, the paranormal alternate universe that's a key part of the show.
• Netflix next month will release another video game to coincide with the premiere of the show’s third season on July 4. Unlike the upcoming mobile game, "Stranger Things 3: The Game" will be available for the Nintendo Switch, Sony PlayStation 4 and Microsoft’s Xbox One gaming consoles. Netflix also plans to release a game called "The Dark Crystal: Age of Resistance Tactics" based on its upcoming re-boot of the Jim Henson fantasy movie.

Insight:

"Stranger Things" is a major hit for Netflix and is well suited for development into a mobile game that gives fans a more immersive experience of the show. A location-based AR game that shows a virtual reality overlaid on the real world seen through a smartphone camera matches the visuals in the series, which interweaves action between parallel realities. Fans of the show will be able to explore the Upside Down as they move about their real surroundings, deepening engagement with the show.

It’s not clear how Netflix will monetize its "Stranger Things" game, but if Next Games' "The Walking Dead: Our World" is any indication, in-app purchases will be a key source of revenue. In-app purchases generate 43% of revenue for gaming apps, according to 2017 data from Statista, although the percentage likely has changed in the past couple of years with the growth of in-app advertising. Consumer spending on paid apps, subscriptions and in-app content increased 17% to $19.5 billion in Q1 from a year earlier, according to app analytics firm Sensor Tower. The firm estimated that consumer spending in mobile apps from Apple’s App Store and Google Play will more than double to $156 billion worldwide by 2023.

Gaming is a key driver of the app economy, accounting for 74% of spending in app stores last year, according to analytics firm App Annie. The company found that 33% of all mobile downloads worldwide consisted of gaming apps, which also made up 10% of the total time spent on mobile devices. The firm estimated that "Harry Potter: Wizards Unite," a location-based AR game due for wide release this year, will generate $100 million in revenue during its first 30 days of availability.