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Bolt CEO says he let go of his entire HR team for creating problems that didn’t exist: ‘Those problems disappeared when I let them go’ 

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Tech

Apple May Have Just Swiped 130 Million Console Gamers Without Breaking a Sweat

By
Chris Morris
Chris Morris
Former Contributing Writer
Down Arrow Button Icon
By
Chris Morris
Chris Morris
Former Contributing Writer
Down Arrow Button Icon
June 3, 2019, 3:44 PM ET

Apple has been inching its way toward becoming a player in the video game industry for years now, but Tuesday’s casual WWDC announcement that Apple TV would begin supporting controllers for Microsoft’s Xbox One S and Sony’s PlayStation 4 in its upcoming tvOS 13 update could be its biggest move yet.

Players will be able to use the popular controllers on all games offered through Apple TV, including those from the upcoming Apple Arcade service.

That’s key, because video games are becoming less and less about the number of consoles sold and more and more about player engagement. (In some ways, it’s reminiscent of several years ago, when the game software industry became less about the number of titles sold and more about keeping players engaged—and, thus, spending more—for longer periods.) By adding support for the two most commonly owned controllers on the market, Apple is giving players who might not have explored its ecosystem otherwise an onramp to its casual gaming catalog.

There are roughly 92 million PlayStation 4 systems in homes worldwide these days. Microsoft long ago stopped giving sales numbers on its Xbox system, but research firm IHS Markit estimated the figure to be over 39 million in mid-2018. That makes for more than 130 million potential customers who will (theoretically) be able to quickly pick up how to play tvOS games, since they’re already familiar with the controller.

Apple is one of the non-traditional companies (along with Google) that’s been showing increased interest in the video game market these days. The video game market saw $43.4 billion in U.S. sales last year, according to the Entertainment Software Association.

Read: All the biggest announcements from WWDC 2019

Later this year, Apple will launch Apple Arcade, a premium subscription gaming service that will let subscribers play and download unlimited games for a monthly fee. The company has partnered with both independent developers and established game companies to create new, exclusive titles. Among the announced partners are Cartoon Network, Sega, Konami and Lego. The service expected to launch with more than 100 titles in over 150 countries in the fall.

“It’s another indication that video games are more and more important to the largest tech companies on the planet,” says Ben Schachter of Macquarie Research. “Apple is already one of the largest video game distributors in the world, but consumers don’t think of them as a first party video game company.”

There is, of course, another potential advantage to these partnerships—and one that benefits Sony and Microsoft more than Apple.

Game streaming is widely expected by industry insiders to become a significant form of distribution in the coming years. Sony already offers PlayStation Now, with over 750 games folded into a single subscription. Microsoft, later this year, will introduce xCloud, a streaming service of its own. And the two companies see streaming as a big enough area of interest that they’ve put aside their rivalry to work together (in an unspecified fashion) as competitors like Google and Apple enter the marketplace.

Google’s Stadia will have its own controller—a mandatory part of the service that carries a charge beyond whatever it costs to play games. (Gamers, additionally, are incredibly picky about how a controller is designed, since it’s their interface with these worlds.) By weaving the familiar and well-liked Xbox and PlayStation controller support into Apple TV, Sony and Microsoft can offer their own streaming services as apps and piggyback off of Apple TV’s success, giving them a market beyond current console owners.

“If the player has to buy a new controller, there’s an additional cost and it takes a while to get used to it,” says Mike Hickey, an analyst with The Benchmark Company. “That’s an inconvenience. If Microsoft and Sony have steaming services and they want [to promote] those through phones, then you have to be able to use your controller…. Apple could just be the gatekeeper.”

More must-read stories from Fortune:

—All the biggest announcements from WWDC 2019

—Apple goes back in time with the iPod Touch

—Huawei prepares for life without Google and Microsoft

—Inside Google’s civil war: an empowered tech workforce rebels

—Listen to our new audio briefing, Fortune 500 Daily

Catch up with Data Sheet, Fortune‘s daily digest on the business of tech.

About the Author
By Chris MorrisFormer Contributing Writer

Chris Morris is a former contributing writer at Fortune, covering everything from general business news to the video game and theme park industries.

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