Apple’s Gaming Revenue Reportedly Exceeds Sony, Microsoft and Nintendo Combined
hypebeast.com
hypebeast.com
Gambling away income so poor stays poor: Fuck yeah! snorts 30 % cut in coke
It's a pretty good illustration of how MTX crappifies game design.
Would you mind sharing some of your experiences?
What were some moments in particular that made you feel not good about what you were doing?
From talking to the folks at the company, I got the impression the target demo was lonely, often alcoholic people in their forties and fifties. Although I find it pretty hard personally to see what the appeal of our product was, I do think the business model was based on getting these people addicted.
If you want to see what the product was like, just search slots on iOS or Android app stores, the company in question doesn't exist anymore but it's all the same stuff. Google and Apple must be making a killing off of it.
Our whale customer profile was something like "Saudi oil-tycoon's trust-fund kid trying to keep up with the Joneses [other Saudi oil-tycoons' trust-fund kids] by throwing money at lootboxes until they get the high-spec or rare equipment required to be equal-or-better in social status."
The way to make whales spend money wasn't to make our mechanics more addictive; it was to "seed" a rare item to one whale in a friend-group of whales, and watch the others scramble to acquire it too, so as to not suddenly be relegated to lower status.
We actually built measures into our game mechanics that would try to subtly disincentivize people from playing if they looked to be genuinely addicted—and for truly severe cases, we actually reached out to customers to get help (since if they're addicted to our game, they're probably addicted to other games, too, so just kicking them off ours probably wouldn't help.) These people were never the key user-story for us, so doing things like this was essentially free publicity.
https://www.gdcvault.com/play/1016417/-100-000-Whales-An
Frankly, I think the Chinese took it to another level.
I have seen no evidence that is true. I guess most of them would be a person working a regular office job who has $1000 dollars to spend per month and throws it at the game since they are bad at managing money / say no. There are way more middle class people who are bad at money than there are rich people who care enough about games to throw money at them.
The story about the trust fund kid millionaire is to help you sleep, it isn't reality. For example, I had a friend who spent thousands of dollars on league of legends over the years, he worked minimum wage jobs. That is the norm.
Edit:
> The way to make whales spend money wasn't to make our mechanics more addictive; it was to "seed" a rare item to one whale in a friend-group of whales, and watch the others scramble to acquire it too, so as to not suddenly be relegated to lower status.
Seeding rewards early to a person/group is a common way to trigger gambling addiction. So to me it seems like you are doing the worst of the worst kind of gambling addiction scheme here, since you admitted to not having fair chances per try but instead seed out items to trigger gambling addiction in people.
I saw hard data for at least the company I worked for, which may not be widely generalizable, but is still better than nothing. We also knew a lot about our player-base; we had community forums, regular meetups, bought gifts for "high rollers" as if we were a casino with attached hotel, etc.
Those Saudi trust-funders aren't made up examples; they're real people — high-touch "tier 1" users, that would regularly request features from the dev team to cater to their ability to better screw with one-another.
> I guess most of them would be a person working a regular office job who has $1000 dollars to spend per month and throws it at the game since they are bad at managing money / say no.
That's not a whale. Whales — at least for us — were people spending at least $10k/mo on the game — with a few spending $100k/mo or more. You can't even do that without being disgustingly rich. It's like collecting F1 cars as a hobby; there are only certain people in the world who can even start down that road, and none of them are going to go bankrupt doing it.
Maybe our games were an exception in the industry, in that there were effectively ways to spend as much as you want, as fast as you want in the games, with money directly translating to a marginal increase in relative "power", without any rate-limiting bottleneck of needing to serially buy and open lootboxes, and especially no bottleneck of there being lootboxes that don't actually get you anything. Because of that, our whales were so profitable in aggregate that we really didn't need to care about making a single dollar from our non-whale users.
But like I said, we did made almost all of our money from the whales, and then basically discouraged anyone else from giving us more than the bare minimum amount of money. If a player was spending trivial (for us—which even included $1000/mo) amounts of money, as a series of smaller, high frequency transactions, we then considered that to be a profile of "an addict spending whenever they get money", and set up our backend infrastructure to detect such players and degrade their gameplay experience over time to suck all the reward-feeling out of the game for them, without actually cutting them off cold-turkey (which we believed would just have them switch over to another addictive game.)
The whole thing was a scheme to bilk the rich, rather than a scheme to make as much money as possible. Sort of like a product that's free for individuals and a million dollars per month for companies.
> Seeding rewards early to a person/group is a common way to trigger gambling addiction. So to me it seems like you are doing the worst of the worst kind of gambling addiction scheme here, since you admitted to not having fair chances per try but instead seed out items to trigger gambling addiction in people.
I don't know why you're focusing so much on gambling; we had some lootbox-like elements, but they weren't the money-makers (this was 2012; lootboxes weren't the same all-encompassing front-and-center business model they are today.) Our "games" were essentially continuous auctions for leaderboard positions. People could still get addicted to them—but not for anything like the reasons people get addicted to gambling.
You pay the arcade subscription ($5/mo or Apple One) and the games are all free downloads.
A perfect example of this is an app called "DayCount". The app's concept is very simple, enter a date, and the app will tell you either how many days until this date, or how many days have passed since this date. When you open the app for the first time you're immediately presented with a "Pro" version, for $3.99/month.
And almost every app does it now, many are "free" but as soon as you open it you realize that you actually have to "subscribe" to the app. Now don't get me wrong, some apps work great with this model. I just happily paid 1Password for another year of service, but 1Password is a genuinely useful application, and they keep my passwords, and paying them $2/mo to take care of this is a great deal in my opinion.
But what kind of value does a "day counting" app add that would warrant an annualized price of $48? I will say that DayCount is better than others, because it actually does something. I once saw an "Emoji Keyboard", a re-implementation of the default emoji keyboard, offered for $9.99/month.
Apple needs some more rules around what is and isn't allowed with iAP purchases. Subscriptions should have extra scrutiny put on them, make sure they actually add value and don't just extract money from users.
Hell it might be a good idea to nuke "Subscriptions" entirely. I get Netflix, Hulu and other services that give you ongoing value. But the notes app you threw together in half an hour using tutorials on Youtube does not deserve to charge $4.99/month for it's "Pro" version.
If users don’t want to pay a subscription for a service that they don’t think is going to add value — not for you or me to determine the value an app has for its legion of users just because it is not of value to us — they shouldn’t download the app or pay for it. Maybe users can use the day counting app to count down days until when their free subscription ends, then unsubscribe. Apple has made it super simple to unsubscribe to a subscription purchased through the App Store. If users don’t use said feature, that’s on them; it’s not the responsibility of the App Store.
Let’s take responsibility for our actions & subscriptions.
Pretty sure Target does that already.
The first says it is a 1 year subscription when viewed on in the store on my iPad, but does not say subscription when viewed in the store on the web. The other three do not say subscription on either the web or iPad.
I can't find anything anywhere either on the store or on the developer's site that says what any of those actually do above what the free version does.
Lately lots of games have started prompting me for "VIP" subscriptions on the order of $6 per week. Or... $312 annually.
Single-player games - so you're not even paying to join a community. One I can recall off-hand is simply a motorcycle racing game.
So many of their devices (iPhone, iPad, Apple TV, now MacBook) seem like such obvious decent gaming machines, far overshadowing something like a Nintendo Switch in specs, that it's really sad we can't get much worth playing on them (personal opinion).
Apple allows this: they are a company of bad taste!
If there's a walled garden to begin with, it's fine to criticize the way it is being run.
They have to my knowledge never produced a game, or a "real" console, yet they rake in more gaming money than any other? That's a hostage situation by any measure.
Am I looking at this wrong?
IMO, yes. Their cut is the same as the big gaming companies (30%), they're just in more hands - they have a bigger market than the consoles.
EDIT: TFA is comparing Apple to Sony, Microsoft, and Nintendo here, all of which have walled garden stores on their consoles, which all charge ~30%. This is rather important context.
Which, as a side note, you are forced to use on those devices.
How is this a qualitatively different situation from Apple then?
The standard being asked for and the outrage only being applied to Apple seems... fake.
Consoles still play games as a core competency, but they can also also run a broad array of apps. I can, for example, watch YouTube and Hulu, and browse the web, on my Switch.
This made me think about why I'm more and more OK with hardware being limited to "blessed" activities.
The older I get, the more time I like to spend doing activities, as opposed to spending time configuring software and hardware to do activities. I don't value getting things working as its own endeavor anymore.
As such, and after spending several decades fighting Microsoft, Apple, and Linux to play videogames on my PC, I value a console's focus on playing games as their core competency.
I like that I can turn on my playstation, pick a game, and not have to figure out the optimal settings for my graphics card, installation options, or wonder if my drivers are properly updated for this game.
Sure, it's not perfect, but it's also no longer my job to perfect.
I still use a computer to do general computing tasks, but it's only doing the tasks I can't do elsewhere. And those tasks are few in number, though great in importance to my hobbies.
There are no other platforms on the devices. Saying I can buy another house if I could only choose one electricity provider or ISP isn't a good defense (in those cases either).
Just look at how big ATVI's mobile gaming revenue is: it rivals (and sometimes beats) the revenue from their "core" products (a'la Call of Duty).
I was more talking about the size of the current install base of the platforms (iOS, Xbox etc) though.
And if that second install base is 8B, and even if only 10% of them play a game, that's still an 800M user market - which is bloody huge.
The actual percentage of game players is significantly higher - some online queries put it at of 50% of smartphone users. That's a potential market of over 4B if we use your assumptions.
Additionally, if you own a phone, you have the potential to buy a game at any time. You just need to be converted (and Apple puts a lot of effort into that in their app store). It's also much lower friction to get a game on a phone than a standard computer (which is, admittedly, pretty low to begin with).
It's what allows Apple have more game-related revenue than Sony, Microsoft, and Nintendo combined.
Music, check. Videos (including streaming platforms), check. Games, triple-check. Browser, check. Apps to make games, check. Exploitative apps, check.
No Kindle/Kobe readers though. Unfortunate, that.
It's forced Internet Explorer on Windows, except 100 times worse because it permeates through the entire platform.
You can't get any other storefronts because that wouldn't funnel money to them. You can't get any game streaming apps, because see first point.
They're general purpose devices in anything that makes them money, and nothing else. It's not because they won't spend money to introduce that functionality, but that they specifically spend money on denying that functionality.
AOL won a suit against Microsoft for integrating IE in Windows. How on Earth is Apple any better? Just to make an add-on point they even force every other browser on iOS to use webkit.
Love it, hate it, they have their value.
Do you think the ruling in AOL v Microsoft was wrong?
You completely dodged that aspect by linking to a comment about games consoles.
So much freedom! I get to market my stuff to poor people and picky, principled tech users.
We haven't seen the last antitrust case against them. I'm certainly looking forward to them getting knocked down a few pegs. Only a stool pigeon would defend their behavior.
For example, it is a weak argument to point out they have not produced a game or a gaming-first console, ie marketed to gamers primarily with the additional capabilities of doing other things. Gaming has been "the other thing".
The reason being that antitrust and anti-monopoly actions from the government are to highlight antimcompetitive practices towards other competitors. Simply winning the lion share of the market has no regulation against it, becoming more vertically integrated or it being pure happenstance that consumers choose to generate revenue for you on the platform is not something we regulate.
Now, by "hostage situation" you must be referring to the developers? You might have an angle here but not in a way that would really change anything. Antitrust regulation here would simply make Apple provide the ability for developers to have alternative payment methods.
So, not clear exactly what you are referring to or want to happen. But I think there are stronger arguments to support what you want to happen. As long as Apple doesn't ever do anything to Sony, Microsoft, Nintendo etc in the gaming space, they'll be fine.
By this logic they have never produced a ‘real’ phone.
Apple has invested hugely at every level in making iOS into a games platform.
Now, Apple knows this. There are technologies (MoltenVK) that are actively being developed to fill this gap. A lot of this tooling is in it's infancy though, and requires an insane amount of overhead to run (doubly so on ARM). The current consensus is that Apple's graphics APIs are too unstable for most cross-platform titles to target, and most game studios would rather not divide their dev teams into "the Mac people" and "the every-other-platform people".
Apple is clearly doing extremely well for themselves and I'm not claiming it's a mistake on their part. But as a user who enjoys playing games, MacOS is by far the worst system for it. Linux is leagues ahead now due to proton and Vulkan.
The hardware is powerful enough for some gaming on macos but nothing supports it. I can get CSGO and RuneScape running reasonably well but those are almost certainly on OpenGL and not Molten.
I think the only significant Molten support has been in the pro video / 3D space.
In short, getting games to run in any capacity on MacOS right now is just not worth the effort. Linux was barely able to do it with the full cooperation of the kernel developers. It's a suicide mission on a system like MacOS.
My hope is that if the macbooks start to take up more of the market, either Apple will cave on Vulkan or Valve will find some way to make proton work.
If games programming was about economics, we wouldn't be hiring developers in the first place.
Appstore is doing it by being the only allowed storefront on a general computing device.
So yeah, your comparison is great if you mean to say that Appstore and Steam should compete under the same conditions.
Get Steam onto iOS and we'll see if the store cuts stay the same, for either party.
If anyone is thinking of working in the Games Industry: don't. All of the profit will be skimmed off by platform owners. Its why wages and conditions are so poor at development studios.
This is probably unlikely to change given that Apple is the #1 most owned stock by the US Congress: https://investinganswers.com/articles/10-most-popular-stocks...
For anyone that does mostly mobile gaming: I’m curious if you feel it’s enriched your life or has just been there to pass time?
Personally, I think the best games on iOS are better than the best games of the 90s. Reasonable people may disagree, however, it's definitely not far.
> For anyone that does mostly mobile gaming: I’m curious if you feel it’s enriched your life or has just been there to pass time?
Yes.
I think the best iOS games are on average much more polished, but less deep/engaging than what we had in the 90s. Some of this is due to the nature of the platform - iOS games are often designed to be played in short sessions instead of sucking you in for hours like a SNES era JRPG.
The elephant in the room though is micro-transactions. Early console games were a complete experience that you bought (or convinced your parents to buy) once. A lot of top grossing iOS games are constantly trying to get more money out of their audience. This skews the design of these games in all kinds of ways like unnecessary timers, pay2win multiplayer, unfair difficulty curves that require "boosts", or repetitive, daily chores to keep people coming back. I think it's these elements that make me long for 90s era video games.
It doesn't matter the complexity or hardcore-ness of a game, its comparing a social experience to an anti-social experience. Social elements of mobile games, to my understanding, are mostly asynchronous like sharing a score or turn-based games. The asynchronous part eliminates the enriching factors of making it memorable.
Madden Football (which comes out every year): $1.62 billion.
There are a lot of games "bigger" than movies in not just revenue but total players/viewers. Engagement isn't even close as players stick to games far longer than the average 100 minute movie.
The interesting thing about this is whether or not Google is in the same ballpark.
I have not worked on mobile games, so maybe someone in the know can educate us. Is the Play Store comparable in revenue for a given game ? Anecdotally, I have heard not. But with in-app purchases being more common now I would have expected that to equalize.
"Further, the evidence demonstrates that most App Store revenue is generated by mobile gaming apps, not all apps. Thus, defining the market to focus on gaming apps is appropriate. Generally speaking, on a revenue basis, gaming apps account for approximately 70% of all App Store revenues. This 70% of revenue is generated by less than 10% of all App Store consumers. These gaming-app consumers are primarily making in-app purchases which is the focus of Epic Games’ claims. By contrast, over 80% of all consumer accounts generate virtually no revenue, as 80% of all apps on the App Store are free." (pg 1)
"With cross-platform games like Fortnite available on multiple devices, these platforms are truly competing against one another for these in-app transactions. For instance, an internal Epic Games email from September 2018 notes that “purchase behavior may have changed with the addition of mobile, especially Apple and more recently Android, where users are just logging onto their mobile app to purchase.” In other words, “most players are still playing on PC/Epic platform[s] as they did before, but purchasing on other platforms like mobile because it may be easier and more convenient [i.e.] when the store updates.”422 This is despite the fact that iOS Fortnite players consisted of only approximately 10% of daily active users, and Fortnite players generally prefer playing on alternative platforms." (pg 84)
From these paragraphs, a clear picture arises:
* Most App Store revenue comes from a small number of high-spending whales purchasing in-game items.
* The reason Apple gets to claim its cut for games like Fortnite is not because people play these games on Apple devices, but because phones are the most convenient way to buy in-game items.
* These high-spending whales disproportionately own Apple devices over competitors like Android, to no one's surprise.
Given these facts, it is no surprise that Apple makes more money than those other companies. Sony, Microsoft and Nintendo tend to make more money from full-priced games rather than free-to-play games with IAPs.
Personally, having tried games from both models, I find one to be clearly more ethical than the other, and it is definitely not the one that forms the backbone of Apple's app store revenue. (I have issues with how locked down game consoles are, but Apple's total control over its personal computing devices is a million times more serious.)
Since you're the one making the claim:
Please put together some numbers of what it costs to work with an international payment processor, managing refunds, customer support options of any sort, managing multi-state and international sales tax revenue and accounting, an update and distribution platform, a CDN equivalent, an easy beta release mechanism, decent security and signing options, your own marketing website, software developer time or salary to build and integrate all of these things, etc. It's possibly more than 30%. Plus if every indie game ISV had to do that stuff that they may not really enjoy just to launch a game, they may not bother writing the game in the first place. This is all value added to the platform.
Which is why everyone has been cool with paying basically the same cut for literally every other platform as well.
They're just unwilling to participate in Capitalism as far as their platform is concerned by pre-emptively blocking off any competition. They want a dictatorship and they want you to pretend it's out of their benevolence.
I thought that capitalism meant that, if it’s their platform they set the rules, and should be allowed to decide what gets sold there and under what conditions.
If you want to sell anything in a physical shop or in Disney World, you have to deal with the conditions of the shop owner, too. It wouldn’t even surprise me if Disney took a cut on each ice cream sold in their theme parks (sellers might even prefer that over a fixed price contract as it moves part of the bad weather risk out of their hands)
The only reason to deviate from that here may be the sheer size of Apple’s platform. That may make them so powerful that their free reign over their store must be restricted (a similar thing has happened in some countries with big supermarket chains versus producers of goods. If Walmart were to decide to stop selling brand X as a negotiation tactic to get better conditions, a court could forbid that)
Imagine that half of the US was Disney World, wherein everything is dictated by Disney because they managed to get there under capitalism.
Capitalism is a great tool and all, but as all other tools, it doesn't solve every problem. In this scenario, it has stopped working inside Disney Nation/World.
It makes no sense for them up-root their entire OS and ecosystem just to switch to Vulkan. Microsoft has no interest either.
So thats why iOS games are upsell garbage. Theyre building for the 6%.
Preying on neurodivergent people is fucked and Apple knows exactly what they're doing.
The gaming mobile market is still too big and valuable. With 30% commmisson, Apple doesn't need to care about Mac gaming, at least for now.
Yes the Switch has an active cooler but it's on quite old silicon and is only pushing a 720p screen.