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Steve Jobs' Retirement

Fri 26 Aug 2011 8:02am GMT / 4:02am EDT / 1:02am PDT
Hardware

Steve Jobs' departure from Apple could actually boost the company's stature in the games business

Even in the upper echelons of industry, there are few business leaders whose retirement would command headlines around the globe - but Apple's extraordinary Steve Jobs is one of them, and his decision to step down as CEO this week was an event significant enough to push the fall of Tripoli off the front pages, even if only temporarily. It was also an event significant enough to wipe the GDP of a reasonably sized small country off Apple's market capitalisation, although given the firm's present valuation, even those gargantuan figures are just a glitch on the graph.

Jobs is a remarkable, high-profile, hands-on CEO, a man whose story causes the eyes of every technology dreamer or business student to gleam. The extent of his personal influence over Apple is unquestionable; the turnaround of the company after he returned from the exile imposed upon him by the managers he hired to run the firm in the 1990s is the stuff of business legend. Yet few question that the team he leaves in place is supremely competent, creative and driven by the same vision and values Jobs himself has followed. So why the jitters on the stock market?

The reason, quite simply, is uncertainty. Apple isn't in a traditional business, where you can easily project forward your sales and talk in terms of gradually breaking into new markets. Rather, it's a disruptive company - a trend-setter whose enormous successes in the past decade have come from smashing apart traditional industries with radical products that upset the market balance and establish Apple as the financial leader in the new order. The iPod did it to portable music players, the iPhone did it to mobile phones, and the iPad so utterly dominates the nascent tablet market (which is itself rapidly cannibalising the low-end laptop market) that some analysts have argued that there's no real market for "tablet devices", there's only a market for iPads.

That's all well and good, and Apple's valuation in the light of those developments (and the quieter but nonetheless impressive rise of the firm's traditional laptop and iMac systems, which have become major players in the consumer computing space) is fully deserved. It's also, however, a risky business - and the stock markets, at least, have felt for some time that Apple's success leans heavily on Jobs' unique skills as CEO. With him gone from the company's day-to-day operations, few expect Apple to crash and burn, but the possibility of direction changes or things being done differently loom over the firm.

Five years ago, the games business wouldn't have cared. Jobs' departure from Apple half a decade ago would have caused games industry bosses no more concern than a fleeting thought about whether their next iPod would be as good as the last one. Today, though, Jobs' departure is as ground-shaking an event as Satoru Iwata quitting Nintendo would be - or as Ken Kutaragi being ousted from Sony was.

There are, surprisingly, still those who question Apple's relevance as a gaming platform holder. Much of that, I suspect, is founded in a basic sense of personal antipathy towards Apple. There's an audience of people, many of them fairly technically minded types who enjoy tinkering with their devices, who find the Apple approach to computing restrictive and don't understand why consumers are willing to pay a premium for design and user experience, rather than taking the time to learn how to use a more complex but ultimately more powerful system.

It's a fair viewpoint, but one that's all too often bitterly entrenched rather than reasonably stated. As Apple's success has grown, the irritation of the Apple refuseniks has swelled past all reasonable bounds - and in the games industry, a business traditionally populated with gadget fans, tinkerers and technically minded sorts, that antipathy is firmly rooted, enough so to make the "debate" over Apple's market position unfairly skewed.

The realities cut through any personal feelings about Apple. Whether you think open source matters, or Flash matters, or iPods are overpriced, or iPads are just overgrown iPhones, doesn't matter. What matters is that tens of millions of these devices are sold every year, far outstripping the sales of dedicated games consoles, and that billions of dollars of revenue subsequently flow through the Apple-controlled App Store, much of it destined for game developers. Apple has created an ecosystem that's healthy, thriving, growing and profitable, and rolling your eyes at the consumer sheep who buy such products without understanding why open source is so important to their Angry Birds experience is both futile and ridiculous.

In thinking about what Jobs' decision to step aside might mean for Apple's position within the games industry, it's worth bearing in mind that Jobs himself has often been suspected of being resistant to the encroachment of videogames on his devices. A couple of half-hearted efforts to woo developers to OSX in the early 2000s aside, Apple under Jobs has been remarkably lukewarm about the prospect of games on iOS or OSX. It was only when games on the iOS App Store exploded, eating up a massive proportion of the store's turnover, that Apple reluctantly recognised the inevitable and began to promote gaming as one of the headline features of its devices.

Even then, Jobs has never seemed entirely at ease with the popularity of videogames on iOS. Games have featured in his keynotes, but unusually for a man recognised as one of the business world's best public speakers and presenters, he seemed awkward and ill at ease talking about videogames - the words from his mouth were clearly not his, the phrases and terminology foreign to him. Jobs is a media guy; as well as dominating music retail with iTunes, he also spent some of his time away from Apple building up Pixar, and later used Disney's acquisition of Pixar to earn himself a position on the Disney board. He is not, however, a games guy, and has never been comfortable with the success of games on Apple's platforms.

With Jobs' departure, then, it seems plausible that rather than simply continuing business as usual - which would be no bad thing, given how good business has been in recent years - the company may actually embrace games to an even greater degree. Where Jobs reluctantly accepted that games were an inevitable and core part of iOS' success, his successors may understand the true importance of the industry - not just to iOS, but also to the Mac platform, whose lower overall sales compared to behemoths like Dell shroud the fact that discounting bulk corporate purchases, Mac systems are incredibly popular among the consumer demographics who actually count as potential gamers.

That a man as young and as successful as Steve Jobs has been forced to step down from his company for health reasons is a sad and unfortunate thing, but Apple's growth and development will undoubtedly continue - not least since much of Jobs' talent lay not in the hands-on management of the firm, but in the creation of a team of skilful, like-minded designers and managers around him, who will now continue his work. Moreover, it is not spin to suggest that in the medium term, Jobs' departure could be an upside for the games business. Apple is rapidly becoming one of the most important companies in the games market - and if its new administration is more switched on to gaming than Jobs was, the firm's growth as a games platform holder will only accelerate.

5 Comments

Nícolas Leite Do Canto
Engineer

2 0 0.0
Jobs worked for ATARI before starting apple! So the argument that he worked with movies, is a media guy... well, he worked for a games company once too...

Posted:3 years ago

#1

Klaus Preisinger
Freelance Writing

1,107 1,089 1.0
Apple's talent is not making the best or most innovative device, but its ability to enable even the dumbest customer imaginable to navigate the app store and spend money there. Why would Apple create and sell any particular software? (other than chains to bind Apple devices to Apple distribution channels) Apple's strength is creating the broadest customer base of buyers imaginable and then take a cut. Did the music labels directly sell music on the iPod? Does your company have its own App Store? Apple successfully applied the console model of selling games to selling music. Create a platform so big, nobody can ignore selling their stuff there, then charge 'em 30%.

Apple doing games is just a pipe dream of people who are so in love with Apple, they assume they will be in love with an Apple game. But looking at the lowest common denominator approach the app store took, an Apple game will be anything but something to fall in love with for anybody who likes games now. Of course, your Auntie Aubrey will think the Apple games is liquid X-Mas every day and spend $200 on it, but that's her, not you.

But why would they apply their model to games? Sony, MS and Nintendo are already doing that. Apple is going to look for something new to "consolize" and corner the market there. Just look at AppleTV and the attempt to pull it off on the IPTV sector. Apple is going to do something like that, utterly big and utterly mad; iGroceries, iFashion or something similar seemingly silly that then turn into billions of profit.

Posted:3 years ago

#2

Andrew Ihegbu
Studying Bsc Commercial Music

451 162 0.4
@Nicolas

Just because you work for a games company does not mean you know about games... and Atari was not a games company then, it was a hardware manufacturer with a small software games wing.... much in the same way Panasonic will have a small software wing that will make the firmware for its devices. Incidentally, this makeup is not a million miles away from what Apple is now.

Aside from that, I really, really don't want to see lazy, lethargic Apple running yet another platform. there are issues on Mac from software it bought from other companies 10 years ago, and whilst they still manage to bring out a new version with new features every few years, every version still has identical bugs. (I'm talking about Logic Pro in case you are wondering).

I don't want to see that translate to a gaming platform, sure it looks like Apple builds everything perfectly, but what I have found is that it neglects anything it isn't particularly focused on. Mac OSX was neglected at the launch of the iPad, the Mac App Store is being neglected now whilst they attempt to replace it with the iOS equivalent. Apple is currently focusing on software, so all of a sudden OSX 10.7 has 4GB(!) RAM minimum hardware requirements, the new Mac Mini has a worse graphics card than the old one, Apple still hs't replaced it's dodgy filesystem from the 80s (which I find myself having to repair from the install disk bi-monthly), and on that note, lets not even think about the possibility of Apple building a home console as it would be a dreadful beast and a seriously in-inventive piece of hardware in a nice case, just as all Apple producets have been since Wozniak left.

Posted:3 years ago

#3

Rick Cody
PBnGames-Board Member

144 14 0.1
Jobs, being a supposed non-gamer, had an advantage however. He probably progressed the gaming aspects in his products in accordance with what he felt absolutely necessary and essential. Basically, he kept it simple. Consumers are sure to appreciate that, especially the ones the game industry doesn't always recognize as gamers, the casuals.

Posted:3 years ago

#4

Tom Plunket

8 1 0.1
Developers' antipathy toward Apple stems, as far as I can see, from the way Apple treats their developers. That is to say, Apple pretty much ignores the needs of the game developer, from outdated drivers to simply nonexistent support.

I love my Mac, but it is not a gaming device until I reboot into Windows. Even the games available on both platforms play, look, and perform better under Windows. Maybe this will change with Jobs out of the picture and maybe it won't. Microsoft has made considerable effort in this arena (what with developing DirectX especially), and Apple just doesn't seem to think that it's important.

Posted:3 years ago

#5

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