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Krister

When I read this I can't help but think of a PC game I enjoy playing which has recently changed its biz model, probably in part to how apps have monetized: Lord Of The Rings Online.

Apparently moving from subscription to freemium was a good move for Turbine.

Tadhg

Indeed, as did Puzzle Pirates. And the highest grossing apps on the App Store are more usually games that are free to download.

Gavinx

..obliging MS to respond.

You should check out Windows Phone 7 Tadhg. Very viable game platform linked to Xbox Live. Gameplay at or above PSP level. Its an interesting v1.0 with the obligatory app store and tight Facebook integration.

Krautpleaser

Thank you very much for this well researched and written article and your interesting conclusions / suggestions.

The arriving of the appstore certainly will shift the gaming landscape for gamers and publishers.

But there are 2 things I am asking myself:

1) Do you really think the usage of desktop computers and mobile computers (in regard of gaming) is such similar?

Think about the amount of time, concentration and privatsphere you need for a whole bunch of videogame genres that don't come in appetizing slices.

The rise of small/one man- studios and their concepts is not coming out of the blue. It's the direct consequence of the demand for a different gaming, not only coz of the smaller screen, but the shorter attention span (oh, the bus is coming, my girlfriend is calling, etc)

2) Do you think the natural habitat for videogame prices really is lying in the 5 $ swamp? Shouldn't we differentiate between what games are worth and people think games are worth (because they want to save as much money as possible)? Isn't the reason, so many people eat really shitty food, that they are not willing (and maybe able) to pay for the fair priced organic stuff, which is more expensive than fast food nevertheless? (I do not want to assume triple A's are fairly priced whatsoever.)

Tadhg

Thanks for the comment K

1) The usage is moderately different. The point was rather that the economics of software between the two are a lot closer than people think. I definitely think that we'll see more similar rather than different behavior between the two.

2) The only amount that games are worth is whatever people think they are worth. There is no such thing as inherent value. Part of the reason why organic food sells is because it is more expensive. By being so, it conveys the sense that it is better quality, and quite a lot of consumers want to pay extra for that quality.

I don't think I'd characterise $5 as the swamp by the way. In real terms the amount made to the developer per copy is about the same ($3.50) as it was under old publishing. All that's missing is that publishing and retail layer trying to add its value.

wilson le

If deeper, 'quality' games aren't viable on app stores, then the App store and Steam serve two completely different markets. App store games are relegated to low-depth/high addiction time-wasters, and so compete with other similar activities (game flash portals, facebook, facebook-games, web-surfing, social games, etc).

Much of Steam's catalog is made of niche indie titles. How would niche titles (of which whose audiences are small) be viable on the Mac App Store?

me.yahoo.com/a/iesECzI1lcINIvgG9uQEbdNaQvb0

Just some comments:

Appstores are not Steam

Closed vs. Curated: What are the terms of service for the app store regarding mature content? Steam does have them. My perception is that the Appstore (at least the iOS one) is far more curated than Steam. There are single man projects in Steam like Garry’s mod but –fortunately- no “fart apps” at all.

Optional vs. Integrated: Maybe the number of PCs with Steam won’t be far from the number of Macs in the market; also add all the other services like Games for Windows or Facebook and the difference will decrease even farther.

Price Control: Digital distribution prices are a delicate subject; Valve, the owners of Steam give some of their games not for $5.00 but for free, maybe the retailer can’t influence much in the final price of the product. Is it really possible to charge the same amount of money for two products with a difference in their development costs of 100s of millions vs. developments of 10s of thousands or less? It’s hard to determine how the prices for games are established, in that regard, the PC Gaming industry has the avant-garde with “free to play games” which are nothing new and stream services like OnLive.

The Mac as Viable Platform

The growth in demand for low end PCs do not cause a decrease on demand for hi-end equipment, it is possible for both markets to grow at the same time. I don’t know of any article which states that the hi-end PC hardware is experiencing low demand; instead I see it grow and diversify. I do agree that Mac is a much more viable platform now (Steam for Mac helped a bit).

Games for Windows, which integrates digital distribution in their service has been around for some time now. That’s technically Microsoft’s response before the Mac Appstore even existed.
As of today, the vast majority of software developers or publishers already have their products in the biggest appstore of all: The Internet. Caothic, but completely unregulated.

The Desktop And The Mobile Market

There is a fourth extremely important deference between mobile and desktop systems: The Input. Most mobile devices relay on analogue sticks, buttons and/or touchscreens, while a desktop has a mouse and keyboard. Almost every interface can be adapted to the later one, but it’s impossible to translate a mouse and keyboard input into a mobile device… at least for now because Razer is working on a mobile mouse and keyboard. (funny how this hi-end PC company keeps innovating huh?)

Gamepocalypse Soon

Why is it assumed that the launch of a product (specially apple products) carry the extinction of another? I’ve never heard: "The new Coke Zero will bring the apocalypse of Diet Pepsi".
And what is exactly a “natural price”? If a lot of people want to buy a Ferrari for $5.00, the natural price of a Ferrari should be $5.00? (sorry for the last “reduction to the absurd” arguments, they are just fun =) )

Taking into account inflation, the price of PC Games has actually decreased in the past decades. The Mac Appstore will be just another way of to distribute iOS and OS X software, and for me that’s the greatest weakness of it (unless the bought applications run in android, windows, etc). Actually on Steam when you buy a game you can download it for PC or Mac indistinctively.

In my opinion the most important contender in this fight will be Facebook, they have an impressive 500 million subscribers, compatibility with almost any system with a browser and very popular exclusives.

Will the Mac Appstore change everything? I highly doubt it.
P.D. Sorry for my English, it’s not my first language.

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