Why the ‘Oxenfree II’ team became Netflix’s first game studio

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In early 2021, Night School was in the market for a partnership. The studio’s debut game, Oxenfree, was a breakout success in 2016, and it was followed by Afterparty in 2019 and then 2020’s Next Stop Nowhere, an Apple Arcade exclusive. By 2021, co-founders Sean Krankel and Adam Hines had made deals with the major players in the industry – Xbox, PlayStation, Valve, Nintendo, Apple – and Night School was an acclaimed indie team.

“We were actually talking to Netflix about just bringing some of our existing games over,” Night School co-founder Sean Krankel said at Summer Game Fest, sitting with co-founder Adam Hines and lead developer Bryant Cannon around a small table behind the demo hall.

Krankel said Night School wasn’t in danger of collapsing or laying off any staff in 2021. He and Hines had about 20 employees, they were still dealing with the effects of the pandemic, and they were interested in establishing real stability at the studio. Maybe they’d even find a buyer. They were casually talking with Netflix employee Bill Holmes – whom Krankel described as “the reason why there’s a Netflix button on our TV remotes” – about potential publishing deals, nothing more.

“It’s like another normal conversation with any first party,” Krankel said. “And then, one day, he literally says, ‘Would you ever be interested in joining?’ And I’m like, hummina hummina – yes. Totally.”

Night School Studio

Night School Studio (Twitter)

Night School was the first video game team that Netflix purchased outright, and the deal was announced on September 28th, 2021. This was just two months after Netflix revealed it had hired former EA executive Mike Verdu to lead the company’s formal push into video game publishing and development, with plans to offer titles to subscribers on its streaming platform. Netflix had been messing around with games since 2017, offering mobile experiences and interactive streams based on popular shows like Stranger Things and The Dark Crystal.

Netflix’s first experiment in video games was Stranger Things, a mobile title that landed in October 2017, developed by Texas studio BonusXP. It was well-received and Netflix and BonusXP went on to release a follow-up, Stranger Things 3: The Game, alongside the premiere of the show’s third season in 2019.

If it feels like there was a weird gap between these releases, that’s because there was – but not in the way you might think. Throughout 2018, Telltale Games was building an episodic narrative adventure (as it generally did) based on Stranger Things, signalling the start of a broader partnership with Netflix. At the same time, Telltale tapped Night School to create a companion mobile game set in the world above The Upside Down. Telltale and Night School had collaborated before on the 2016 Mr. Robot mobile title, Mr. Robot:1.51exfiltrati0n.

As reported by The Verge, Night School began work in January 2018 on a first-person narrative adventure that would feed directly into the wider-platform game, and Krankel and Hines hired four new people for the project. Telltale missed a number of milestone payments to Night School and was generally difficult to communicate with, according to studio members who spoke with The Verge. And then, in September 2018, Telltale effectively shut down. Night School was left floating for a while, until it was clear their game was dead, too. There’s been a Netflix-shaped ghost in Night School’s résumé ever since.

By 2021, Krankel and Hines had seen the best and worst of what publishers had to offer, and Netflix was finally ready to admit its video game ambitions. The Night School team had considered acquisition offers from other companies over the previous few years, but “there was always something off,” Krankel said.

“After the first chat that I had with the executive team [at Netflix] about this next thing, it was so exciting, because they didn’t ask me, you know, ‘Are you in the red on this?’ Or, ‘What’s going on with that?’ It was more like, ‘What can we do to unblock your team from making your dreams?’”

Hines added, “Our big concern was the autonomy aspect. We’ve all worked at bigger studios before, and have just seen and felt how long it would take to get decisions made, how the creative would kind of get choked out of things because there’s too many cooks in the kitchen. But just talking to Netflix a lot before we joined up, we felt really at ease, just like we were talking the same language about how to make games.”

Night School’s latest project is Oxenfree II, a hotly anticipated sequel coming to PlayStation 4, PS5, Steam, Switch and mobile devices via Netflix on July 12th. (There’s no drama behind the Xbox exclusion, Krankel said: “Nothing happened honestly; it is just where we are in our development.”)

Night School has expanded its team size and moved into the Netflix offices, and they’re able to fly remote employees in as often as they need. One obvious benefit of the Netflix partnership in Oxenfree II is its inclusion of 32 languages at launch.

“That’s crazy,” Hines said at Summer Game Fest.

Lead developer Bryant Cannon agreed: “Especially for a game with hundreds of thousands of words in it. All that’s really exciting. I think the game is going to be better because we have this battery in our back.”

Night School was the first purchase in September 2021, but Netflix today owns six video game studios, including Alphabear developer Spry Fox and two internal teams in California and Finland. Netflix has plans to expand into AAA development and past mobile platforms; it offers more than 50 games in its library right now, and the company plans to add 40 more by the end of 2023.

Netflix is publishing more games than it’s buying outright, including Spiritifarer, Into the Breach, Poinpy and Kentucky Route Zero. One of the biggest names in its pile is Laya’s Horizon, the latest title from Alto’s Adventure and Alto’s Odyssey studio, Snowman. Laya’s Horizon is a serene wingsuit game set in a sprawling mountainside sandbox, and it’s exclusive to Netflix Games on Android and iOS.

Laya's Horizon title screen.

Snowman

Snowman got its start publishing the iOS versions of the Team Alto games in 2015 and 2018, followed by the Apple Arcade timed exclusives Skate City and Where Cards Fall. Snowman developed and released Lucky Luna for Netflix in 2022, followed by Laya’s Horizon this May. Snowman’s games tend to end up on multiple platforms, eventually, but Android has generally been an afterthought. Its last two projects landed on Android and iOS simultaneously because of Netflix.

In April, Snowman founder Ryan Cash told Engadget that the Netflix partnership hadn’t been a barrier for players. Yes, you need a Netflix account to play the games. But:

“Everyone I’ve had this conversation with has Netflix,” Cash said. “So they just get to playing right away. Whereas before, it was either, I have to sell them a $5 game or I have to tell them, OK, it’s free to play, there are ads but you can remove them if you want. Or it’s like, you gotta sign up for Apple Arcade, or you need an Xbox or whatever it is. So it’s been the most barrier-free way to tell people what I do.”

Laya’s Horizon doesn’t have a currency system, microtransactions, pop-ups or billboards advertising real-life products lining the slopes of its virtual mountain – because Snowman doesn’t need these features for the game to be adequately profitable. The Netflix partnership took care of that aspect, and creative director Jason Medeiros didn’t have to implement monetization in the actual game.

“I didn’t want any of that stuff,” Medeiros said. “Because I mean, I liked games before all that stuff happened. So having a platform like Netflix, it’s just like, none of that matters. Like, you don’t have to do that stuff. It’s a breath of fresh air; we jump on opportunities to make games that way.”

When I initially asked the Night School crew why they chose to be bought by Netflix, Krankel immediately got to the heart of the matter and volleyed, “Why not remain independent?” And then he answered his question:

“A small subset of teams are good to go for the next 10 years, but others have these peaks and valleys, and we were somewhere in between. We weren’t in danger of anything going sideways. But we were at a spot where we’re like, it would be cool to tether to somebody who has a similar vision, and somebody that we could work with that would like, de-risk us.”

Signing up to be acquired by a massive media company comes with its own risks, but they’re different concerns than those of a fully independent operation, which has to manage funding and paying salaries without a safety net. The challenge for indie studios is to sign up with a parent company that can strike a healthy balance between support and autonomy, and Netflix has a proven track record in this space when it comes to film and television. Games are just the next frontier when it comes to streaming entertainment.

Catch up on all of the news from Summer Game Fest right here!

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Abraham
Expert tech and gaming writer, blending computer science expertise