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>No one is making money off gaming hardware. Huh? I mean, surely nobody is making Apple-money from gaming hardware. But plenty of companies of various sizes ar

>No one is making money off gaming hardware. Huh? I mean, surely nobody is making Apple-money from gaming hardware. But plenty of companies of various sizes are decently profitable and making money in this space.

wtallis 6y ago
It wasn't that long ago that gaming consoles were being sold at an astonishing loss, to be made up on services subscription revenue. They're mostly not loss leaders anymore, but the hardware sales are definitely not responsible for significant profits. Video game console hardware has lower margins than gaming PC components, which are already a very low-margin market segment (except where companies can get away with a 30% surcharge by adding RGB LEDs). If Apple tried to compete in that space, they'd face an instant shareholder lawsuit.
- dgellow 6y ago
  They branded their Apple TV as a game platform. It has a controller that looks like a console gamepad and is one of the target platform of Apple Arcade.
  - wtallis 6y ago
    That's obviously not in the same league. The gaming capabilities of Apple TV are still pretty much an afterthought. The games available are more likely to be ports from smartphones, not Xbox/PS platforms. The processing power is a small fraction of what a video game console or gaming PC requires, which is why Apple can use leftover old smartphone SoCs instead of having to invest in actual high-end chips for the device. There's the potential for the Apple TV to become a serious gaming platform in the future, but it would require a major shift in product strategy from Apple. That shift would have to include putting much more expensive hardware inside the Apple TV, increasing the BOM by more than the current retail price.
    - dgellow 6y ago
      Regarding the hardware, are you deliberately ignoring Nintendo? They have low cost, cheap hardware, good margins, and are able to get a huge part of the market. I agree on the need of a shift in product development, but the hardware isn’t what is lacking here.
      - lostgame 6y ago
        This certainly has not always been the case. Nintendo lost money on consoles same as SEGA and everyone else.
        dgellow 6y ago
        Not sure how that’s relevant to what is discussed here. Would you only consider game console companies that never lost money?
- jdietrich 6y ago
  >Video game console hardware has lower margins than gaming PC components, which are already a very low-margin market segment The high end has quite generous margins and the volumes are absolutely insane, which is why we're now doing HPC and ML on what is basically gaming hardware. Nvidia have a broad spectrum of markets, from the high margin and low volume Quadro to the low margin and high volume GTX - in a business that's dominated by NRE costs, that's a good place to be. Apple providing support for gaming wouldn't necessarily be profitable in itself, but it'd potentially provide the volumes to improve their offerings for professional rendering applications. Apple refuse to do business with Nvidia and they've been hamstrung by AMD's weak offerings, but a gaming-focused Apple could acquire some IP and tape out their own GPUs.
growse 6y ago
Given the size of the iPhone gaming industry, I think Apple is making Apple-money from gaming hardware.

wtallis 6y ago

It wasn't that long ago that gaming consoles were being sold at an astonishing loss, to be made up on services subscription revenue. They're mostly not loss leaders anymore, but the hardware sales are definitely not responsible for significant profits. Video game console hardware has lower margins than gaming PC components, which are already a very low-margin market segment (except where companies can get away with a 30% surcharge by adding RGB LEDs). If Apple tried to compete in that space, they'd face an instant shareholder lawsuit.

dgellow 6y ago
They branded their Apple TV as a game platform. It has a controller that looks like a console gamepad and is one of the target platform of Apple Arcade.
- wtallis 6y ago
  That's obviously not in the same league. The gaming capabilities of Apple TV are still pretty much an afterthought. The games available are more likely to be ports from smartphones, not Xbox/PS platforms. The processing power is a small fraction of what a video game console or gaming PC requires, which is why Apple can use leftover old smartphone SoCs instead of having to invest in actual high-end chips for the device. There's the potential for the Apple TV to become a serious gaming platform in the future, but it would require a major shift in product strategy from Apple. That shift would have to include putting much more expensive hardware inside the Apple TV, increasing the BOM by more than the current retail price.
  - dgellow 6y ago
    Regarding the hardware, are you deliberately ignoring Nintendo? They have low cost, cheap hardware, good margins, and are able to get a huge part of the market. I agree on the need of a shift in product development, but the hardware isn’t what is lacking here.
    - lostgame 6y ago
      This certainly has not always been the case. Nintendo lost money on consoles same as SEGA and everyone else.
      - dgellow 6y ago
        Not sure how that’s relevant to what is discussed here. Would you only consider game console companies that never lost money?
jdietrich 6y ago
>Video game console hardware has lower margins than gaming PC components, which are already a very low-margin market segment The high end has quite generous margins and the volumes are absolutely insane, which is why we're now doing HPC and ML on what is basically gaming hardware. Nvidia have a broad spectrum of markets, from the high margin and low volume Quadro to the low margin and high volume GTX - in a business that's dominated by NRE costs, that's a good place to be. Apple providing support for gaming wouldn't necessarily be profitable in itself, but it'd potentially provide the volumes to improve their offerings for professional rendering applications. Apple refuse to do business with Nvidia and they've been hamstrung by AMD's weak offerings, but a gaming-focused Apple could acquire some IP and tape out their own GPUs.

growse 6y ago

Given the size of the iPhone gaming industry, I think Apple is making Apple-money from gaming hardware.