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Why Apple Arcade is a big threat to console makers

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For years there has been an undercurrent that Apple underutilised its leverage with the app store and the burgeoning gaming segment. Many believed that it could make a legitimate play for the gaming market with the Apple TV. Without even doing it, iOS was already the biggest gaming platform in the world. Well, Monday was its coming out party. Apple announced Apple Arcade which is a premium game subscription service featuring exclusive games that will work across Apple hardware including the Mac, Apple TV and of course the iPhone and iPad. More importantly, these games will be exclusives to Apple’s universe and they will be completely ad-free and have no in-app purchases. And yes, this is not a streaming service like Google’s Stadia, but rather a more traditional form of gaming where you download the games on your device and play them off-line. So why this is a threat to big-ticket console makers —

  • Apple’s hardware is already very powerful. For instance, with the new iPad Pro, Apple touts Xbox One S class graphics in a package that’s smaller than even the Microsoft Surface Pro. That means it will start attracting a lot of triple-A developers who could make Apple exclusives.
  • Apple TV is one of the most popular entertainment hubs. More games would extend its utility and its affordable pricing compared to consoles will make it a very compelling alternative to mainstream consoles like the Xbox One S and the Nintendo Switch.
  • Exclusives are the lifeblood of a gaming platform and if Apple is able to foster and nurture a breed of powerful exclusive games for Arcade, it will give iOS an advantage over Android. iOS already has an edge as a development and monetization stable.
  • While Apple hasn’t shared all the games that are coming to Arcade it has some big-ticket developers like Konami, Lego, Cartoon Network and Sega on-board. If you go to the Apple website, there are quite a few games already that are coming to Arcade which is commendable.
  • The success of consoles like the Nintendo Switch and Wii in the last two decades point to the fact that users want more unique and family oriented experiences than crazy graphics and violence which has been the forte of Microsoft and Sony hardware. Apple is well positioned to provide a middle ground between what Nintendo, Microsoft and Sony have been doing.
  • Knowing Apple this service will be affordable which works well for a service that’s targeting families rather than adults. And if that’s the case, it changes the paradigm of buying games. This will be counting card of the service.
  • Vertical integration of Apple’s custom GPU technology with the Metal graphics framework has potential to pump out even more powerful graphics that too on a yearly cadence as opposed to game consoles which have on an average had a half a decade long life cycle. Over a generation, Apple could easily one-up traditional gaming platforms in pure graphics.
  • The launch of this service also foreshadows the launch of a more powerful Apple TV which could have iPad Pro like graphics and perhaps even have a gamepad of its own which could make it an even more compelling hub for consuming content at home, instead of something like an Xbox or PlayStation. The Xbox and PlayStation would be more limited platforms from an app point of view, while the Apple TV wouldn’t be.
  • The fact that it will launch in over 150 countries at the same time being available on over a billion devices makes this kind of the AR Kit of gaming. Every developer on the planet will need to pay attention to this service. If they don’t, it will be at their own peril as the monetisation opportunity is immense.
  • Considering most of the games on Arcade have been designed to be family friendly and meant mostly for mobile class hardware, there is potential for Apple building a game streaming platform in the back-end in the years to come which could immediately match what Google or Microsoft are trying to do.

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