The video game console is an expensive business to get into. Microsoft has sold 67 million Xbox 360s to date, but it cost the company billions to bring the original Xbox to market back in 2001. $300 million to acquire Rare in 2002, $1.15 billion in warranty coverage for failed Xbox 360s in 2007; these costs are chump change compared to the investment in developing the consoles, the infrastructure for Xbox Live, and the design work done on the brand itself. It’s paid off for Microsoft, transforming the company into an entertainment brand as much as a utility brand associated with Windows, Office, and Internet Explorer, but the expense to get in the game is what those in the business call a spicy meatball.
It’s no wonder then that Apple continues to insist it’s not interested in getting into the video game console business.
Speaking at the All Things Digital-hosted D10 conference event on Tuesday, Apple CEO Tim Cook addressed his company’s interest in the game console business. “Gaming has kind of evolved a bit. More people play on portable devices. Where we might go in the future, we’ll see,” said Cook, “Customers love games. I’m not interested in being in the console business in what is though of as traditional gaming. But Apple is a big player today and things in the future will only make it bigger.”
Those “future” things that might make Apple a player in the traditional space are the Apple TV and the much-rumored Apple iTV, a high-definition smart TV. When asked at the conference if the Apple TV set-top-box would be positioned as a gaming console in the future, Cook responded by saying, “I think it could be interesting.”
Apple TV is already a gaming console in many ways, at least for iPad owners who can stream game content to their televisions through the box with the aid of apps like Joypad. The rumored Apple iTV would be an extension of that service, with iOS games purchased from the App Store downloaded directly into the device.
The console business as Cook described it is in a profound state of flux. The days of a box sitting in the living room that you buy disc-based games to play on are ending and fast. In the future, when all game content is delivered digitally on whatever platform, Apple will already be a leader in the field thanks to the success of the iPhone, iPad, and iPod Touch. Why would the company make a console? It already has three of the best-selling handhelds in the world.