Apple Console Rebuttal

A reader has commented on our speculation about “Apple’s Next Move” as possibly producing a console system. I found this an intriquing line of discussion and thought I’d bring it up again with my comments and responses to the readers comment. See the original article here.

1. Christian Koster says:

Look, Apple is not entering the Console Game market. Of course they can afford to do it, but they’d lose a lot of money. The 360 and the PS3 are losing money on every console, we know this. Obviously Apple would have to go with a Revolution philosophy, but then why would anybody buy an Apple over the Rev? So then we look at if they did the Home Media center thing and then added a game console feature to it. Well, now we have a computer than can do all the Home media things and can play games. So it will cost as much (or more probably) as a PS3/360 and have the graphics capabilities of a Revolution (or probably less).

And where are the games coming from it. We have seen that a 4th player in the console market never lasts, so somebody would need to go. Now it looks like that could be the 360 (crossing fingers) but if Apple joined the market the support for them would be abysmal. The only way Apple could have done it is if the Revolution tried to be the graphical monster that the PS3 is. Then, Apple could have taken the simple/innovative way (which would have been very convincing like we have seen with OSX and the iPod).

One final paradox: Apple will not enter the console market because they would not succeed if they did. However, if they did enter the market they would succeed.

(Meaning if Apple did enter the market it would be because Jobs saw the magical way to be successful in it, that mere mortals like us could never comprehend until he showed us the light.)
January 5th, 2006 at 1:08 am

Or maybe they are? No one on earth would have believed Apple was going to switch to Intel chips if we had predicted that last year. The console market is going to change a lot in the next couple years. It’s an unfortunate truth that in all likelyhood one of the major players is going to fail and there is a good chance it will be Nintendo.

Furthermore it’s not inconcievable that Apple would consider making console machines but they definately would not do it at a loss. Something Apple is exceedingly good at is selling really nice hardware at a premium price and making a 60% or greater margin on it.

Honestly if Apple applied it’s usual technique to the console market they would dominate over the current major players if merely for the fact that they wouldn’t be losing money on early single console they sold unlike Microsoft and Sony.

Now a niche market that is nearly untapped at this point is the portable gaming market. The Playstation Portable has done surprisingly poor and the Nintendo DS has had meidocre sales until recently. A slick handheld unit with style and good battery life could go a long way in todays market. The PSP looks nice but is huge and clunky while the DS is fairly portable but is ugly and has a bizarre interface that people aren’t taking to (How the hell are you supposed to hold it while using a gamepad and touching another screen at the same time? Grow another arm?).

I think that the biggest possibility for this unlikely entry into the portable gaming fray would probably be a future generation of Ipod. Millions of people already have them and will likely upgrade if the features are right. Supposedly the next gen Ipod is going to have nothing but a huge touchscreen accross it’s entire front so it would be feasible to also ship it with some basic games like tetris. Now what would be even more genius would be that Apple could deliver more games Itunes for a fee instantly. As we’ve learned with the Ipod the convienence of Itunes easily overroad the competition in the hardware market for mp3 players. Apple quickly took 90%+ of the market and continues to hold it to this day.

The only thing in the way of portable gaming on the current Ipod is really just the interface. The click wheel is incredibly annoying to use for games but ideal for navigating mp3s. Now if they were already going to go with a touchscreen it would be quite easy to dynamically change the interface to suit the current application be it playing mp3s/movies or games. The unit is powerful enough to run basic games already and could easily be pumped up to handle better graphics while maintaining Apples high profit margin.

As is typical of Apple they would also try to use the new system as a way to leverage Mac sales through further convienence and coolness factor. With Intel processors running in their entire line by release time for any new Ipod/Console device they would already be set to get a plethora of gaming companies producing for their computer systems as well.

Which brings me to another topic… Why do you think Apple is switching to Intel? Surely it can’t just be cost as it’s a drastic step to take just to cut costs. Jobs is planning on growing Apples’ computer market share. For other than the obvious advantages of more profit it makes sense from a user-base standpoint. The Mac becomes more valuable for Game and Application publishers to release new software onto when it has a larger user-base. It’s the whole reason Apple platform machines are unpopular now. Because they can’t run what the other 90% of the world is running easily. Its the same reason Apple switched to a Unix based OS a couple years ago. They knew Unix would instantly add to the their userbase especially in the nerd category which is probably the most influential on other buying groups. Nevermind the massive amount of opensource software OSx added support for as well.

I merely wanted to point out reasons why our previous speculation could easily be true (Not that it is now of course) and construct a logical reasoning set behind it. Feel free to comment and realize this is all for fun and being right down the road would merely be a bonus for us 😉

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