Netflix is happy building its gaming business quietly, but that doesn't mean the effort lacks ambition, the company's head of gaming, Mike Verdu, tells Axios.

Why it matters: Netflix's gaming efforts have been a headscratcher to some and a no-brainer to others. But its success so far has been low-key, at best.

What they're saying: "Netflix doesn't make a lot of big bets," Verdu says. "The company's been patient around those bets and put the work in to get it right. And this is one of those."

• "It's not, you know, put your finger in and dabble a bit. You make a commitment, and you do it right."

Context: Last month marked the second anniversary of Netflix as a gaming provider. The company has released more than 80 games — all free to subscribers and exclusive to mobile.

• In that time, Netflix has built two game studios and purchased four others. In a year of thousands of game industry job cuts, Netflix's gaming teams have had none, Verdu says.
• The company now has more than 10 games in development in house and, through deals with external teams, a total of 90 in the works, says Verdu.
• Existing titles range from indie darlings like Into the Breach and Storyteller to Netflix spinoffs of the hit "Love Is Blind" and "Too Hot to Handle."
• Verdu called that last one an "upside surprise," as users seemed to enjoy "playing a game where you can, like, immerse yourself in that show." (A "Squid Game" video game spinoff is also forthcoming.)

Between the lines: The streaming giant has more than 240 million global subscribers, but it doesn't say how big its game team is or even how many times its games have been downloaded.

• The numbers crunched by outside firms indicate that only a tiny percentage of Netflix subscribers are downloading games. The company's offerings, promoted mostly through a carousel of titles in Netflix's mobile app, are easily missed.
• "We're not going to do a giant marketing campaign to say, 'Games are on Netflix,'" Verdu says.
• Why not? "The games live inside of Netflix, which has a huge distribution footprint, for sure. The key is to connect our members with the games that they'll enjoy. And it doesn't have to come all at once."

Zoom in: Over the last two years, Netflix's gaming operation has slowly become more, well, Netflix-y. Games tied to Netflix shows have increased and will expand even more thanks to some of its first-party studios. (Verdu stresses that non-Netflix IP will continue to be part of the portfolio.)

• Netflix has tested streaming games to subscribers' TVs and computers, as it does its shows, with players using an app that can turn their phone into a game controller.
• "The results are encouraging, but it's on a very small scale and it's going to be awhile before you see that deployed much more widely," Verdu says.
• The company has begun harnessing its famous algorithms to offer personalized gaming recommendations.
• It's even removed a couple of games from its library. "I would expect to see movement in and out of the catalog," Verdu says.

The intrigue: Netflix has also announced that its new Los Angeles studio, helmed by developers who've made big-budget console games, is making a AAA (industry jargon for big-budget) game for PCs.

• "If you fast-forward into the future when we do have a gaming experience that's frictionless and ubiquitous and very approachable, then you know we're going to want to serve up some core experiences on that platform," Verdu says.
• Plans like that will put Netflix in direct competition with gaming's traditional powerhouses in the console and PC market.

What's next: Netflix gaming won't have a quiet Thursday. It is releasing three iconic Grand Theft Auto titles from Rockstar Games on mobile, exclusively to its subscribers.

To read more on Netflix's gaming plans from Axios Pro, sign up here

E3, once the centerpiece of the gaming industry's annual calendar, is officially finished.

Driving the news: The Entertainment Software Association, the D.C.-based trade group that runs the long-running midyear showcase, announced on Monday that it was retiring the show.

• ESA president Stanley Pierre-Louis cited a proliferation of alternate means for companies to promote their games, per The Washington Post.

Between the lines: E3 began in the 1990s as a business-centric trade show, a means for game publishers to show retail buyers the biggest games they'd be offering through the holiday season.

• The multiday event expanded over the years, drawing tens of thousands of attendees and evolving into a promotional circus.
• But E3's relevance came into question in recent years as some of its biggest attendees, including Sony and Nintendo, began to pull out in favor of their own events and online showcases. Complications from the COVID-19 pandemic further dogged the show — there hasn't been an E3 held in person since 2019.
• The ESA had been exploring a variety of options for an E3 revival, a source familiar with the situation told Axios, but decided in December to end the show. The organization went public with its decision shortly after, because companies are finalizing their 2024 marketing budgets and would need to know.

Be smart: Much of what generated the buzz around E3 in midyear could still continue.

• Company showcases — in person or online — from Nintendo, Microsoft, Ubisoft and others that kicked off each E3 week weren't technically part of the show and could still return.
• The Game Awards host and one-time E3 event partner Geoff Keighley has run his own June game industry showcase, Summer Game Fest, with a mix of in-person and online events each of the last two years. That event is slated to return in June 2024.

Seven months since the game's release, Legend of Zelda: Tears of the Kingdom players have figured out how to go from the game's start to the defeat of its final boss in under a hour, as charted by Axios data journalist Kavya Beheraj.

Why it matters: Speedrunners are famously irrepressible, but Tears is still proving a tough game to clear fast.

• By the same seven-month mark in 2017, players of the similarly gargantuan The Legend of Zelda: Breath of the Wild were posting sub-40-minute runs, according to the latest records on Speedrun.com.
• The record for BOTW is down to 23:42.

Be smart: Early Tears of the Kingdom runners used an item duplication glitch that Nintendo patched out a few weeks after the game's release.

Watch the current 59:19 Tears of the Kingdom world record [in French]

👩🏻‍⚖️ Epic Games won its lawsuit against Google over restrictions on payment systems in the Google Play app store on Android phones, Axios reports.

• A jury sided with Epic on every claim, but remedies won't be decided until next year. Epic is hoping the decision will allow app makers to use other payment systems or even run their own stores on Android, sidestepping Google's 30% cut. Google is appealing.

💬 Swen Vincke, head of Baldur's Gate III developer Larian Studios, is among the winners of The Game Awards who is sharing what would have been their full acceptance speech. IGN gathered a bunch.

🔥 Doom turned 30 this past weekend, and Dominic Tarason celebrated with a massive rundown of the game's sequels, spinoffs and spiritual descendants.

🚨 Hackers say they've breached Sony's Insomniac Games and are threatening to release game footage and other internal information, Polygon reports. Sony is investigating.

👀 Twitch has updated its sexual content guidelines after a spate of popular streams by streamers who appeared to be topless. "Under the new changes, Twitch will now allow streamers to broadcast content that 'deliberately highlight[s] breasts, buttocks or pelvic region,' even when fully clothed,'" Polygon reports.

🎬 Hideo Kojima is partnering with film and TV production company A24 ("Moonlight," "Everything Everywhere All at Once") on a Death Stranding movie, Variety reports.

😲 Tencent's new headquarters in Shenzen, China, is set to be completed in 2028, according to Yanko Design. It looks like a SimCity 2000 arcology.

📉 U.S. video game hardware sales were down 24% in November, compared to the same month a year ago, according to Circana's latest report. PS5 came in first, but the Switch, in third, had a steep decline.

• Modern Warfare III was the highest-grossing game of the month, and trailing only Hogwarts Legacy for top new release of the year (An asterisk: Nintendo's The Legend of Zelda: Tears of the Kingdom is close to MWIII, but Nintendo doesn't share digital sales with Circana, making it hard to be sure which is ahead).

Short of any final surprises, major game releases are done with for the year, so let's look at what's in store for the start of 2024.

• Some trivia: 10 years ago, Nintendo actually released a new game, Dr. Luigi, on New Year's Eve.

January

• Prince of Persia: The Lost Crown (PC, console), The Last of Us Part II Remastered (PS5), War Hospital (PC, PlayStation, Xbox) and Tekken 8 (PC, PlayStation, Xbox) are released.

February

• Suicide Squad: Kill the Justice League (PC, PlayStation, Xbox) and The Political Machine 2024 (PC) are released.
• "Halo" (Season Two) premieres on Paramount+.

March

• Dragon's Dogma II (PC, PlayStation, Xbox) and Princess Peach: Showtime (Switch) are released.

April

• "Fallout" premieres on Amazon Prime.

May - December

• 🤷‍♀️

One of the greatest pleasures of covering video games is being able to walk into a room of new games and be reminded just how creatively vibrant the field is.

• That was the case last Friday when I zipped through a Day of the Devs event in Los Angeles before catching a flight.

Off against one wall was Mars after Midnight, a game from Lucas Pope (Papers Please) about serving martians at diners.

• It's a bit silly, given that a lot of the game involves serving or clearing the right plates with the right tentacles at the right time. The demo also hinted that players will be strategically trying to serve a whole town's worth of hungry creatures.
• It's coming to the monochromatic Playdate system next year, with support for other systems down the line.

Opposite that was Llamasoft: The Jeff Minter Story, the next playable piece of gaming history from Digital Eclipse, this one housing 42 games from Minter's psychedelic oeuvre. There will even be a game from the Konix Multisystem, a British console that was never released.

Between those two, I found Cryptmaster, a black-and-white adventure game that has players furiously typing to figure out new magic spells.

In an adjacent room was Give Me Toilet Paper, a Switch game that you control by tucking a controller into a real roll of toilet paper.

Nearby were Death the Guitar, in which you play as a killer guitar, and Whisker Squadron: Survivor, which hooked me as soon as its developer told me it was a cross between Star Fox and Vampire Survivors.

As I exited, I caught sight of Home Safety Hotline, a game about offering advice to callers who have increasingly disturbing complaints about the sounds, shadows — and teeth marks — they're finding in their homes.