It’s almost annoying that back (4 years ago) when Faultline was saying that Apple logically HAD to enter the mobile phone space, and that it could potentially take top end leadership, no-one listened, and now everyone is going on about the markets that Apple can invade. And for the most part, they’re right.
And the gaming market must look ripe to pluck right now if you are an Apple executive, or better still if you are Steve Jobs sitting back in your office after a 6 month break, and thinking ‘Where was I?’ and about to resume plans for digital media conquest.
So when one analyst from Wedbush Morgan this week told various media that Apple is working on adding games to its Apple TV device, it has some credibility.
What we have with Apple at the moment in games is ephemeral and we expect it to stay that way. The games you can play on an iPod Touch are engaging because of the touch capability, but they are not deep in gameplay nor do they use alarmingly good graphics. Those games cannot right now touch the console offers of Microsoft, Nintendo or Sony. What they do instead is add a casual gaming dimension to an existing device and through the Apple App Store there has come available a bewildering collection of mostly casual games.
And this pretty much points to how Apple so far has thought about games ‘ make the devices and the games will come. It is a long journey to a classic console where for instance Sony offers a device for maybe $400, which cost it $850 to build. It then recoups its losses (investment) through contractual obligations with games providers as millions of games are sold. That’s not a business model that Apple will even consider because it’s so far from where its business models are right now. Apple instead will apply its own formula, which is that the device itself makes you all the money, the music, games, applications, make someone else money which in turn drives the eco-system.
So if you imagine that the Apple TV, already in its second generation, and with a recent download of version 2.4 of its operating software, becoming a games console, you are wide of the mark. Who would develop for a device with such a small installed base.
You have to think like Apple. There is no reason why all the games in the App Store could not be made to play directly on Apple TV. It is driven by an Intel processor and an NVIDIA GeForce 7300 graphics processor, it runs a cut down version of OS X and hackers have comfortably put other Apple applications on the device, including iPod games. They have also put up MacOS X applications including iTunes, Joost, Firefox, and even World of Warcraft. The Intel CPU in the Apple TV is low voltage Pentium M, based on the Dothan core with about 256 MB of main memory plus 40 GB to 160 GB of disk store.
What Apple might do is work hard to create a common environment where all of its major platforms can speak to each other, simply, using its existing Air Extreme Wi-Fi hub. That way a game on an iPod Touch perhaps can simply be turned into a two player version with the inclusion of connectivity in the home using the Wi-Fi hub and some storage on the Apple TV (or elsewhere in the network, even on a Mac).
Already you can use this connectivity to turn your iPod, iPhone into a touch sensitive TV controller, selecting the Apple TV, internet or PC held video you would want to view on your TV, and fast forwarding and rewinding by just swiping your handheld device.
Game rendering might then be done by either the iPod, the Mac or the Apple TV and shipped out to whatever screen you are using for viewing. Right now that might be the TV set, it might be the iPod Touch or an iPhone, but it could just as easily be a new iPod style tablet with a larger screen. In other words Apple layers the game eco-system all the way across all of its devices, adding connectivity as it goes.
There are then many reasons to buy a new iPod Touch tablet (if it does plan to launch one of these), as a Kindle style book reader, as a netbook style web browser, as a video player for viewing films and as a game screen for showing better graphical quality games, if Apple can source any.
Sony has already done this. Even now you can use a PS3 as a DVR for your pay TV or free TV service in Europe, upload internet videos onto it, and play them anywhere in the world on your Sony PSP or Vaio laptop. So why wouldn’t Apple pull the same trick.
That would make Placeshifting one of the key first steps that Apple needs to add to Apple TV, improved gaming might then be left to the development community. So what Apple has to do it make sure that all of its platforms are as interoperable as one another for certain classes of applications and provide the connectivity with a high ease of use.
Placeshifting for Apple is a very different process than for Sony. Instead of re-compressing video from the analog hole, for iTunes content it can simply allow its Fairplay DRM to decode on any platform, and swap keys. Of course for content that Apple doesn’t sell you, it might want to have a general purpose technique for re-compressing video into a stream that can be sent over any broadband line to an Apple device (Apple probably would not license the streaming software to non-Apple devices).
All of this strengthens the media experience on Apple devices and gives more work to the Apple TV, to make it more a part of the integrated whole, but it doesn’t actually improving the quality of the gaming to the point where it might challenge the big three gaming console players.
One way of doing that is to somehow make the link between existing console games and Apple’s most popular devices ‘ the iPod Touch and iPhone ‘ through the Apple TV. For instance can Apple offer the authors of existing PlayStation 1 and PlayStation 2 games which were not made with an exclusive license to Sony, a conversion in its SDK to a new Apple TV gaming environment. The gaming company would have to be promised a way of getting the games onto iPhones, so that’s downloading them from the App Store, but right now the graphics environment is just not up to taking such games. Playing them through the Nvidia graphics chip on the Apple TV might work (or the next generation of that device), and then the iPhone and iPod could show subordinate views (screens) and act as the games controller (something else that a PSP can do on a PS3 game).
It’s tenuous, but games producers do use conversion systems to make a PS3 game launch-ready on the Xbox or Wii, and vice versa, so why couldn’t Apple use the popularity of the App Store as a way to leverage the same type of conversion process. It would be even better if ‘taster’ versions of games could be downloaded from the App Store and then ‘High Def’ versions downloaded to an Apple TV.
So we think the idea that Apple is working on turning the Apple TV into a games console is perhaps the wrong way of thinking about such a development. Instead we think that Apple is inexorably creating a common applications environment across all of its devices, to create a common look, feel and lifestyle across anything containing the Apple logo, and that might have the same effect, long term.