No, I don't act that way because that's not what I said. I said it puts Apple in the position of becoming a major developer for a competing platform.
I see Apple as already a major developer on Windows. Given that I'm typing this on Safari on windows at the moment with iTunes playing something in the background. Although, to be honest, I use chrome a lot more today because of Wave.
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This is strange strategy to undertake unless it has a very good purpose (e.g., iTunes), which even after your explanation, I don't see in support of making a big, new move into games.
Games has been a traditional weak spot for Apple and the primary reason that folks keep Windows in bootcamp (most business users can get by with parallels). It's not an important weak spot except in the living room.
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You can't say that AppleTV is not central to Apple's current strategy.
I can say that because they've done very little with it to date. It is no more central than the mini that gets occasional updates and sometimes fills in the same role in the living room.
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I think it might very well be. At the very least, Apple quite clearly wants it to be. If Apple judged this product to be a failure, they would have discontinued it. Instead they are continuing to develop it further.
aTV 3.0 isn't that much. We'll see with the next hardware update. Without 1080p and/or gaming it'll remain in hobby status.
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My experience is that gamers tend to overestimate the importance of games. Believe it or not, relatively few people play them more than casually.
100M+ DS, 50M+ Wii sales says different. The console market is a $24B market and Nintendo, despite the recent cratering in profits still expects $2.5B in profits this year.
But what is $18B in sales, $8B in gross profit and $2.8B in net income? That's only about half of Apple's $36.5B revenues, $13M gross profit and 5.7B net income...
Pfffft.
The value of games is clearly overestimated and Apple is clearly not interested in gaming with the iPod touch...
Whoa! That certainly hit a cord with me personally... been there, done that, and didn't have enough money left over after the disaster to get the t-shirt! Should have left the money in the bank!
Well no need to worry. The purchase of either Adobe or EA is so remote as to be pretty much zero. Apple has traditionally purchased much smaller companies.
If Apple wanted to signal entry into gaming more seriously it would buy Bungie Studios, LLC long before they bought EA. Which would provide Bungie an amusing corporate history.
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However, it is still my position that Apple needs to add to their Creative Toolbox... specifically on the photo side, to compliment and enhance both iPhoto and Aperture. Also, easier and complimentary tools to aid in the content creation of their new LP format, and possibly the content on their yet unrealized iTablet.
Which they will do over time in the normal product development cycles for iPhoto and Aperture. I, however, don't see any new software tools (or purchases) that are not related somehow to the iPhone/iTunes ecosystem in the near future.
I have enjoyed reading your argument and believe that you have put it well. I believe too that the new iMac is much more than just an incremental upgrade and would be fabulously supported by Apple gaining access to the skills base at EA, which I hadn't thought about until reading your case. (A colleague, who writes software for OS X, made the comment - referring to the iMac, that it had been a long time since there was such a strong argument to purchase a top of the line model.)
Yes, the counter to that is the rather limited sales of product lines like Alienware. Still I'm sure Dell sells a reasonable number of XPS machines to the gaming market. While PC gaming isn't dead, certainly the interest is centered on consoles.
AAA games exclusive to Apple might stimulate some higher end iMac sales but most gamers already bootcamp if they get a Mac anyway.
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I'd like to see some games where parents could sit down with their children and share adventures. In the 'old days', savvy parents would sit down with the children around the dining table and read to them, with them, supervise home work and play table games. This is still possible but add to the mix, the fabulous worlds and concepts that could be explored on a well utilised iMac.
There are MMOGs for kids of all ages and parents should definately be involved in any of those options. These all play well on the mac from Disney to WoW.
I find that most regular computer games aren't all that well suited to collaborative play like in board games. I have my fair share of Dora and other kid game experience...and my wife hates computer games anyway.
I see Apple as already a major developer on Windows. Given that I'm typing this on Safari on windows at the moment with iTunes playing something in the background. Although, to be honest, I use chrome a lot more today because of Wave.
I don't. As I said before, iTunes for Windows makes sense for obvious reasons -- it helps drive iPhone and iPod sales, which is where the real money is at. Safari for Windows, I frankly don't get the rationale, but I suspect they have one. Either way, at the moment, that's it for Apple's Windows development (except for the separate FileMaker division). Taking on EA or Adobe transforms Apple instantly into a major Windows developer -- going from two titles to potentially dozens. This is a big leap into an area where I see potential problems, and questions from investors about the logic.
Yes, Apple's gaming support on the Mac remains weak -- but this has gone on for so long, I can't see it as not being deliberate. Apple has always (especially in the Jobs II era) been very careful about where they compete -- where they think they can, and not on every front, and not especially where they are vastly outnumbered. Introducing gaming on the iPhone/touch is a classic Apple strategy. Going head-to-head with Windows and the gaming consoles would be extremely risky. Do I need to explain why? I hope not.
We'll see how important AppleTV (and its successors) will be to Apple's strategy. I have a sense that it's more important than many realize now, but I will reserve judgment. Maybe you should, too.
I don't. As I said before, iTunes for Windows makes sense for obvious reasons -- it helps drive iPhone and iPod sales, which is where the real money is at. Safari for Windows, I frankly don't get the rationale, but I suspect they have one. Either way, at the moment, that's it for Apple's Windows development (except for the separate FileMaker division). Taking on EA or Adobe transforms Apple instantly into a major Windows developer -- going from two titles to potentially dozens. This is a big leap into an area where I see potential problems, and questions from investors about the logic.
A major developer of windows software isn't just number of titles but the expertise behind those products. Given that you don't understand the rationale for Safari, then what makes you think you can better predict where Apple will and won't go?
The reason for Safari was to make webkit more popular and more likely supported by web sites. It also provides Apple with a browser that they can customize for MobileMe if they desire. Google does this with Chrome and Wave. While Wave will run on most browsers it runs best in Chrome.
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Yes, Apple's gaming support on the Mac remains weak -- but this has gone on for so long, I can't see it as not being deliberate.
Of course it has been deliberate.
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Apple has always (especially in the Jobs II era) been very careful about where they compete -- where they think they can, and not on every front, and not especially where they are vastly outnumbered. Introducing gaming on the iPhone/touch is a classic Apple strategy. Going head-to-head with Windows and the gaming consoles would be extremely risky. Do I need to explain why? I hope not.
Yes you do have to explain "why" rather than simply handwaving it. Because that's just like saying going head to head with Nokia, Microsoft, Palm and RIM with smartphones is extremely risky because they are vastly outnumbered.
Sure but Apple did it anyway. And Apple has called out Nintendo with the iPod Touch vs the DS.
For consoles there's THREE competitors. Not dozens. Nintendo, Sony and Microsoft. Of those, really only Nintendo matters because Apple cares mostly about the same casual gaming demographic that Nintendo targeted with the Wii.
Apple isn't going to make a PS3 or 360 competitor product for hard core gamers. What they would want are the folks that play games like Rock Band. Slightly older than the Nintendo demographic (they wont have Mario or Pokemon) but casual players still. A 1Ghz Cortex A8 based aTV could probably handle that.
A $299 aTV with iPod touch games running at 720p would sell a LOT better than the current aTV. And one that integrates closely with iPhone/iPod touch further stimulates touch sales.
So explain how adding gaming to the aTV to capture a segment (say 10%) of the $24B console market is "extremely risky"? The hardware/software is relatively easy (it's essentially an iPod touch in aTV form).
The primary expenditure is getting content. This is done by Apple buying a studio or two for 1st party developers and paying EA, Activision, etc for some exclusives. Then using the independents on the app store for the majority of the content. This isn't going to cost THAT much. A top end title costs $10-100M. For the kind of titles that Apple would want it would be at the low end of that spectrum.
The problem right now for the iPod touch is currently the GOOD games fetch $9.99 with some $14.99 and $4.99 titles. It's simply too hard to recoup the development costs for a AAA title even with a 70% split. Typically they'll get around $16 per unit sold on console games.
Moving in the gaming direction helps Apple both for the iPod Touch/iPhone and in the living room.
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We'll see how important AppleTV (and its successors) will be to Apple's strategy. I have a sense that it's more important than many realize now, but I will reserve judgment. Maybe you should, too.
If all it does is what it does today without games I say it'll remain limited. It needs an app store in addition to iTunes content.
Comments
No, I don't act that way because that's not what I said. I said it puts Apple in the position of becoming a major developer for a competing platform.
I see Apple as already a major developer on Windows. Given that I'm typing this on Safari on windows at the moment with iTunes playing something in the background. Although, to be honest, I use chrome a lot more today because of Wave.
This is strange strategy to undertake unless it has a very good purpose (e.g., iTunes), which even after your explanation, I don't see in support of making a big, new move into games.
Games has been a traditional weak spot for Apple and the primary reason that folks keep Windows in bootcamp (most business users can get by with parallels). It's not an important weak spot except in the living room.
You can't say that AppleTV is not central to Apple's current strategy.
I can say that because they've done very little with it to date. It is no more central than the mini that gets occasional updates and sometimes fills in the same role in the living room.
I think it might very well be. At the very least, Apple quite clearly wants it to be. If Apple judged this product to be a failure, they would have discontinued it. Instead they are continuing to develop it further.
aTV 3.0 isn't that much. We'll see with the next hardware update. Without 1080p and/or gaming it'll remain in hobby status.
My experience is that gamers tend to overestimate the importance of games. Believe it or not, relatively few people play them more than casually.
100M+ DS, 50M+ Wii sales says different. The console market is a $24B market and Nintendo, despite the recent cratering in profits still expects $2.5B in profits this year.
But what is $18B in sales, $8B in gross profit and $2.8B in net income? That's only about half of Apple's $36.5B revenues, $13M gross profit and 5.7B net income...
Pfffft.
The value of games is clearly overestimated and Apple is clearly not interested in gaming with the iPod touch...
Whoa! That certainly hit a cord with me personally... been there, done that, and didn't have enough money left over after the disaster to get the t-shirt!
Well no need to worry. The purchase of either Adobe or EA is so remote as to be pretty much zero. Apple has traditionally purchased much smaller companies.
If Apple wanted to signal entry into gaming more seriously it would buy Bungie Studios, LLC long before they bought EA. Which would provide Bungie an amusing corporate history.
However, it is still my position that Apple needs to add to their Creative Toolbox... specifically on the photo side, to compliment and enhance both iPhoto and Aperture. Also, easier and complimentary tools to aid in the content creation of their new LP format, and possibly the content on their yet unrealized iTablet.
Which they will do over time in the normal product development cycles for iPhoto and Aperture. I, however, don't see any new software tools (or purchases) that are not related somehow to the iPhone/iTunes ecosystem in the near future.
Vinea
I have enjoyed reading your argument and believe that you have put it well. I believe too that the new iMac is much more than just an incremental upgrade and would be fabulously supported by Apple gaining access to the skills base at EA, which I hadn't thought about until reading your case. (A colleague, who writes software for OS X, made the comment - referring to the iMac, that it had been a long time since there was such a strong argument to purchase a top of the line model.)
Yes, the counter to that is the rather limited sales of product lines like Alienware. Still I'm sure Dell sells a reasonable number of XPS machines to the gaming market. While PC gaming isn't dead, certainly the interest is centered on consoles.
AAA games exclusive to Apple might stimulate some higher end iMac sales but most gamers already bootcamp if they get a Mac anyway.
I'd like to see some games where parents could sit down with their children and share adventures. In the 'old days', savvy parents would sit down with the children around the dining table and read to them, with them, supervise home work and play table games. This is still possible but add to the mix, the fabulous worlds and concepts that could be explored on a well utilised iMac.
There are MMOGs for kids of all ages and parents should definately be involved in any of those options. These all play well on the mac from Disney to WoW.
I find that most regular computer games aren't all that well suited to collaborative play like in board games. I have my fair share of Dora and other kid game experience...and my wife hates computer games anyway.
I see Apple as already a major developer on Windows. Given that I'm typing this on Safari on windows at the moment with iTunes playing something in the background. Although, to be honest, I use chrome a lot more today because of Wave.
I don't. As I said before, iTunes for Windows makes sense for obvious reasons -- it helps drive iPhone and iPod sales, which is where the real money is at. Safari for Windows, I frankly don't get the rationale, but I suspect they have one. Either way, at the moment, that's it for Apple's Windows development (except for the separate FileMaker division). Taking on EA or Adobe transforms Apple instantly into a major Windows developer -- going from two titles to potentially dozens. This is a big leap into an area where I see potential problems, and questions from investors about the logic.
Yes, Apple's gaming support on the Mac remains weak -- but this has gone on for so long, I can't see it as not being deliberate. Apple has always (especially in the Jobs II era) been very careful about where they compete -- where they think they can, and not on every front, and not especially where they are vastly outnumbered. Introducing gaming on the iPhone/touch is a classic Apple strategy. Going head-to-head with Windows and the gaming consoles would be extremely risky. Do I need to explain why? I hope not.
We'll see how important AppleTV (and its successors) will be to Apple's strategy. I have a sense that it's more important than many realize now, but I will reserve judgment. Maybe you should, too.
I don't. As I said before, iTunes for Windows makes sense for obvious reasons -- it helps drive iPhone and iPod sales, which is where the real money is at. Safari for Windows, I frankly don't get the rationale, but I suspect they have one. Either way, at the moment, that's it for Apple's Windows development (except for the separate FileMaker division). Taking on EA or Adobe transforms Apple instantly into a major Windows developer -- going from two titles to potentially dozens. This is a big leap into an area where I see potential problems, and questions from investors about the logic.
A major developer of windows software isn't just number of titles but the expertise behind those products. Given that you don't understand the rationale for Safari, then what makes you think you can better predict where Apple will and won't go?
The reason for Safari was to make webkit more popular and more likely supported by web sites. It also provides Apple with a browser that they can customize for MobileMe if they desire. Google does this with Chrome and Wave. While Wave will run on most browsers it runs best in Chrome.
Yes, Apple's gaming support on the Mac remains weak -- but this has gone on for so long, I can't see it as not being deliberate.
Of course it has been deliberate.
Apple has always (especially in the Jobs II era) been very careful about where they compete -- where they think they can, and not on every front, and not especially where they are vastly outnumbered. Introducing gaming on the iPhone/touch is a classic Apple strategy. Going head-to-head with Windows and the gaming consoles would be extremely risky. Do I need to explain why? I hope not.
Yes you do have to explain "why" rather than simply handwaving it. Because that's just like saying going head to head with Nokia, Microsoft, Palm and RIM with smartphones is extremely risky because they are vastly outnumbered.
Sure but Apple did it anyway. And Apple has called out Nintendo with the iPod Touch vs the DS.
For consoles there's THREE competitors. Not dozens. Nintendo, Sony and Microsoft. Of those, really only Nintendo matters because Apple cares mostly about the same casual gaming demographic that Nintendo targeted with the Wii.
Apple isn't going to make a PS3 or 360 competitor product for hard core gamers. What they would want are the folks that play games like Rock Band. Slightly older than the Nintendo demographic (they wont have Mario or Pokemon) but casual players still. A 1Ghz Cortex A8 based aTV could probably handle that.
A $299 aTV with iPod touch games running at 720p would sell a LOT better than the current aTV. And one that integrates closely with iPhone/iPod touch further stimulates touch sales.
So explain how adding gaming to the aTV to capture a segment (say 10%) of the $24B console market is "extremely risky"? The hardware/software is relatively easy (it's essentially an iPod touch in aTV form).
The primary expenditure is getting content. This is done by Apple buying a studio or two for 1st party developers and paying EA, Activision, etc for some exclusives. Then using the independents on the app store for the majority of the content. This isn't going to cost THAT much. A top end title costs $10-100M. For the kind of titles that Apple would want it would be at the low end of that spectrum.
The problem right now for the iPod touch is currently the GOOD games fetch $9.99 with some $14.99 and $4.99 titles. It's simply too hard to recoup the development costs for a AAA title even with a 70% split. Typically they'll get around $16 per unit sold on console games.
Moving in the gaming direction helps Apple both for the iPod Touch/iPhone and in the living room.
We'll see how important AppleTV (and its successors) will be to Apple's strategy. I have a sense that it's more important than many realize now, but I will reserve judgment. Maybe you should, too.
If all it does is what it does today without games I say it'll remain limited. It needs an app store in addition to iTunes content.