Apple’s iPhone and iPod touch platform has over 50-million customers. It’s clear that Apple has a hit product line. Add to that the successful App Store, with over 75,000 apps (over 21,000 games), and 1.8-billion downloads (not including updates), and it’s also clear that something has changed. Games.
First, a look at those staggering numbers. 50-million units in less than two years. That number is likely to hit 100-million within another couple of years.
Second, humor me, and compare Apple’s recent unit sales to the lifetime sales of Microsoft XBox (30-million), Nintendo Wii (52-million), and Sony PlayStation 3 (24-million), all bonafide game systems, each different, each successful in their own right.
Each claims many tens of millions of software titles sold.
Games or Gamers?
Clearly, computer games have a thriving market, indeed, multiple markets, segmented by different types of products and buyers. Nintendo’s Wii is substantially different than Microsoft’s XBox which is not a Sony PS3.
The common ground for all three is that they are fun to play (for their respective target market segment), and software game titles cost much more than the newcomer to the game industry, Apple’s combined iPhone and iPod touch.
Hard core gamers tend to prefer the XBox or Playstation to the Wii. However, the Wii appeals to a broader audience of casual game users, more interested in fun than high tech graphics and superior sound. The Wii is interaction of a different color.
Apple’s Ignorance of Games
After ignoring the game industry for 25 years, Apple is making up for lost time with the iPhone and iPod touch platform. How is Apple doing? Matt Peckham of PC World disses Apple’s angle and attempts at carving a profitable niche:
Apple’s Phil Schiller wants you to think the iPhone is way, way, way cooler than the Nintendo DS and Sony PSP. Has Schiller ever laid eyes (much less fingers) on an actual DS or PSP?
Probably not and it doesn’t matter. A huge portion of the population hasn’t laid eyes on anything via XBox, Wii, or PSP.
Does he think some 150 million gamers are going to swoon when they see id’s Doom Resurrection running on the iPhone before realizing they’ll have to play it without tactile buttons?
Of course not. Those gamers won’t go for games on an iPhone or iPod touch. Why? That’s the game platform for the rest of us; those of us who’ve ventured into Wii (confined to the living room and the TV), but won’t bother, ever, to go for the restrictive and single purpose PSP or XBox world, and $30 games that are difficult to play.
The iPhone has clear potential as a touch-based gaming platform (the fact that Apple’s seriously late to the party notwithstanding).
That’s the tacit calm before the hair-on-fire storm. Wait for it. Here it comes.
Drawing dismissive comparisons to Nintendo and Sony’s handhelds veers beyond conventional competitive swagger into the realm of market ignorance.
To hear Matt tell it, Apple is totally ignorant of the game market and doomed to failure. Unfortunately for Matt’s deservedly stained reputation, and fortunately for the rest of us, he totally, completely, laughingly misses the whole point of Apple’s game effort.
The PSP and DS have massive audiences and cater to a particular type of experience that—again, in certain genre-specific cases—the iPhone will never be able to match.
See? Short sighted Matt is at it again. The Wii will never be able to match the XBox experience, yet Nintendo sells more Wii units than Microsoft sells XBox units, despite the technological superiority of the latter over the former. Why? The Wii is fun in ways the rest of us fully understand, appreciate, and will pay money to obtain.
Is it not obvious that Apple is not trying to match the game experience of PlayStation or XBox, but has already provided an experience that is both different and similar to the Wii. Games on the iPhone and iPod touch are inexpensive and fun.
Why isn’t Apple celebrating what the iPhone does well instead of unwisely dipping its rhetorical pen in a demographic inkwell it’s badly misread?
Misread? Let the numbers speak. Apple’s game efforts seem to be paying off in tens of millions of units sold (already equal to XBox), and in hundreds of millions of game downloads in less than a year. Matt’s glaring misread of Apple’s intent and success continues.
First rule of marketing: Know your market. Second rule: Know how not to alienate consumers in the process of growing it.
First rule of journalism: Get the facts. Second rule: Try to see the whole picture. Matt missed badly on both counts.
With more hype than fanfare, and while not many competitors were paying attention, Apple did what Wii did but in a different, almost parallel direction—created a whole new market segment for games.
The rest of us.
Let me do those numbers again. 50-million units sold in two years. 100-million units sold within two more years may be on the low side. That total will surpass Wii, PS, or XBox. 1.8-billion downloads from the App Store (not including updates) in a year. That translates to 36 apps for each unit sold. My iPhone has triple that many apps and games.
Clearly, there is a market for $30 games on high powered game machines. Even more clearly to everyone except Matt Peckham of PC World, there is an even larger market for $1.00 to $10 games that are a lot of fun and fit in your pocket. For now, who owns that growing market, Matt?
Apple’s executives are not ignorant of the game market. They’re crazy. Crazy like a fox.