The Mac App Store And The PC Gamepocalypse

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The will change everything. It won't happen overnight, but it will happen, and the results will be very far reaching. App stores change how users think of software, how they pay for it and also how they maintain it.
They're as radical a shift as that which changed mobile gaming from a Java platform to a real gaming system, and with the sort of financial repercussions of the Facebook ecosystem. It's that significant, and yet almost nobody in games even realises that it's happening.
The reasons why are these assumptions:
- Digital distribution of games has already been solved by Steam
- The Mac is not a viable game platform
- The PC is not the mobile market
- Content is valuable
All of which are shaky. Let's start with the first.
App Stores Are Not Steam
Steam may appear to be much the same thing as an app store, but there are three core differences between the two:
Closed vs Curated: The basic philosophy behind Steam is that of the managed shop. To get your game onto a service like Steam, it is not simply a matter of rocking up with your code and shipping it. You have to send your game to the service and have it approved on the basis of whether it's a good fit for the store. Steam is not interested in having every game that it can possibly handle. Instead, it is interested in managed relationships and individuated products.
The reason for preferred differentiation is that it means the selection on display hits every major category of game with a choice of quality. The belief at the heart of the service is that every good game should have its day in the sun, and Steam actively works to keep its content varied. This makes Steam the equivalent of a select bookstore trying to maintain an appropriate range.
App stores, on the other hand, are like Amazon: They stock everything. The Apple iPhone Store available, and rather than act like a content monitor managing a range, Apple exercises approval rights on a set of ground rules to do with platform integrity. 95% of submitted apps are approved within days, and Apple's only editorial input is the front page service on iTunes for the apps that it thinks are interesting.
The difference between the two approaches is that the Apple model makes a bet on the Long Tail, but the Steam approach makes a bet on the Short Head. The Apple model is much more manpower-intensive (approving that many apps a day takes staff) but also generates much more revenue over the long term. It is also more of an incentive for developers to publish there because the barrier to entry is a lot simpler to understand.
Optional vs Integrated: The next thing is that app stores are integrated into platforms, but Steam is not. Start [link widoczny dla zalogowanych] ing today, Macs all around the world are going to receive software updates that install the Apple store into OSX, and the updated version of OSX also contains it as a mandatory element. This means that it is going to be a feature of all new Macs as well. That's very powerful.
All software environments have an issue when it comes to visibility for non-default software because many users are simply not motivated enough to go searching for software that's not in front of their faces. The ability of a platform to bind users into its software is why Microsoft ended up in court over Internet Explorer, but also why Internet Explorer is still the dominant browser worldwide. Default behaviour is also why users often use Google as a navigation tool to find Facebook or Twitter instead of using URLs because it's just much simpler.
Steam is not integrated. Users have to choose to install it, which means that they have to know it exists and have a reason to care about it. Many don't, and have never heard of Steam. This means that Steam is more like the arthouse cinema that dedicated viewers go out of their way to find rather than a catch-all solution, and now that the app store is here, it means that Steam will increasingly be relegated.
Price Control: Lastly, Steam is very involved in the pricing of games. They create Steam Sales all [link widoczny dla zalogowanych] the time in order to pull customers back into the service, with massive discounts like 75% off Indie Packs. These sales lead the way for customers to buy full price software, and it's full price software that publishers like because it retains the perception of value in their content.
In app stores, developers pretty much control their own pricing and business models with very little supervision. On the iPhone this led to a race to the bottom very quickly, with most apps costing $0.99 or $1.99, and even several of the big-name games only managing to charge maybe $5.99 at best. Indeed, Neil Young of ngmoco maintains that anyone even thinking of charging a cent up front in the iPhone App Store is wasting their time, and needs to be thinking about charging on the back end instead (virtual goods etc).
Price control for developers inevitably reduces the price of software down to near zero, and makes the market all about achieving volume rather than high revenue per customer (ARPU). The high ARPU model is the one by which most modern publishing operates because it allows for significant profit margins, whereas the app store model relies on making cents on the million downloads, or revenue from 2% of customers.
That is what the app store is going to bring to desktop software. It's absolutely fantastic for users because it mean FFXIV account s that they are going to get their hands on way more cool software than they ever could before in a clean,[link widoczny dla zalogowanych], safe and cheap environment. It is, however, apocalyptic for any game developer whose model has relied on low unit sales with high ARPU.
The Mac as Viable Platform
Macs have never been regarded as much of a platform by the games industry. PC game developers traditionally like to push the boat out in terms of graphics especially, and the Mac has always felt about two steps behind the PC in terms of sheer horsepower. Gamers who wanted desktop gaming always bought ninja PCs as a result, so the Mac remained the tool of graphic designers and the like.
At least, that's how it used to be. In reality, PC graphics plateaued out a couple of years ago. It's been a long time since anyone could actually notice the difference between one bleeding edge graphics card or another. Secondly, the PC as a platform has been concentrating more on the lower end, like netbooks, or games based in Flash, and there is much less of a demand for super-powered PCs than there used to be.
Lastly, many of the big PC developers moved over to console a while ago (citing imaginary concerns over piracy of all things). Long story short, PC gaming has been pretty much stuck for around 3 years, and has become the stronghold of indies and console developers Final Fantasy XIV power leveling who still publish a PC version of their latest game after the console version has released.
Mac games have always existed, but game stores rarely stocked them. So there has always been something of a weighting against the Mac as a game platform because of a lack of visibility. Of course, the app store solves that, and so Mac gaming will probably become a huge growth area this year. On the iPhone, the app store really turned on the appetite for mobile gaming in a way that no other platform had managed to do simply by making mobile games highly visible and available. The same will happen for the Mac.
But regardless of whether the Mac is or is not a viable game platform, the assumption that that makes the app store irrelevant to PC gaming misses the point. The point, rather, is that Microsoft will have to respond.
Even if Apple does not include the App Store as a part of PC iTunes (Im betting they won't), Microsoft will still have to roll their own. What will happen if they don't is that the Mac will become widely known as the better, simpler and cheaper software platform ('there's an app for that' etc), leading to more Mac sales and less Windows sales. If they don't do it then the Windows platform will take a serious, possibly even fatal, hit.
In a similar vein, Google also has to respond. Android is already ahead of the cu Final Fantasy XIV gold rve by allowing app stores to exist within its environment. Chrome is also now featuring an app store, which doesn't make a great deal of sense in the browser, but does in the Chrome OS context. , putting together an Android store. However they want to exercise control over pricing like they wanted to for Kindle books. That might not be too smart, but the principles aside from that are very sound.
The point? It's not about Apple. Apple's store is simply a beach-head. The point that the games industry need to be taking notice of is that app stores are going to be everywhere.
The Desktop And The Mobile Market
Another assumption is that the desktop is somehow inherently different to the mobile market, and that this means that the pattern of what happened in mobile will not be repeated.
There are three essential differences between mobile and desktop, and they are screen size, interface restrictions and whether you sit down to use them, or use them on the go. Within those bounds, the use of software is much the same. You can use your mobile to play a game, write an email, compose a document or a blog post. You can use your PC to make phone calls,[link widoczny dla zalogowanych], surf the web or scribble notes.
Barring heavy use cases (Photoshop for example) there isn't that much difference between the two styles of computing. Certainly for games the gul FinalFantasy XIV account f is not so wide that consumers would behave in a fundamentally different way. Sitting down to a computer is simply a more concentrated use case, it is not a different use case.
I think that believing the desktop will behave inherently differently is a very dangerous assumption to make. While the desktop PC or Mac certainly have some institutionalised software that is very expensive, there is every indication to suggest that games in particular thrive when they are cheaper.
Gamepocalypse Soon
The big difference between soon and now, and the reason why app stores have the potential to be apocalyptic for the desktop, is that the current arrangement (through Steam etc) is vastly over-inflating the price of games. The game consumer wants to pay a lot less for their games because they do not find them as , and app stores are going to reduce that price significantly.
Many indie games charge $25, and many retail games charge $40 or $50. But there is ample evidence to suggest that the natural price (the price that users want to pay) for games is actually $5. When 2D Boy did an experiment with flexible pricing with World of Goo a couple of years ago, they had players essentially choose what they wanted to pay from across a range. The best balance of revenue versus purchase numbers came in at $5.
When Steam does its 75% off sales on Final Fantasy XIV Gil Indie Packs, they most commonly end up valuing the individual games at $5 or less. Whether small, large, indie, retail or back catalogue games, $5 is the natural price. Steam sales sell way more copies of games in these sale packs than individual releases because the price point is right.
I think that what app stores are going to do to the desktop market is bring its pricing into line with where it naturally wants to be. In the process this is going disempower many developers and publishers who believe their business model should be ARPU-based rather than volume-based. It will reduce the number of big-budget games to only a handful, perhaps making those games seem like the ultra-premium Gucci bag game, where most others are simply regular bags.
And yet it will also empower many newer developers.
The upside of the iPhone app store is that it has made many new household names, such as Angry Birds,[link widoczny dla zalogowanych], and spawned a whole new economy. Apocalypses tend to do that because they create new fertile ground where before there was nothing but dense jungle. So the app store era for the desktop is one that should fill many of us with hope, as long as we don't cling too much to the past. Or our sense of how things should be rather than how they are.
There's still time to get ready for the changeover, but it won't hang around forever.