What makes a video game system successful?  Is it the library of games?  Is it the complexity of the graphics?  Or is it the “fun” factor?  I think the current generation of consoles quite effectively illustrates the reasons why certain game consoles blow others out of the water–revolutionary ideas.  The Wii, with its mediocre graphics and poor library, has managed to outsell all of the following devices combined during the month of April this year: Xbox 360, the PS3, PSP, and PS2.  Not too shabby for a device that Sony and Microsoft don’t see as competition to their devices.  Quite simply,  the Wii brought something new to the table, something that the other competitors, whether they like to recognize it or not, failed to do.

So, how is this a mac related post?  Enter the iPhone as a gaming device that could be in direct competition with the DS and the PSP in the mobile gaming device market in the upcoming years.  It currently lacks a decent “library” of games much like the Wii did, and the majority of the games out there seem to be more proof of concept than they are full-fledged games, but the iTunes application store has only been open for business for a couple of months.  At the rate that Apple updates their iPod/iPhone line, if we give the iPhone another generation or two, we might see a new, and very real, competitor in the portable gaming market.

What separates the Wii from the other consoles, also separates the iPhone/Touch device from handheld consoles.  Accelorometer and motion sensors, oh my!

Let’s stop and think for a moment what that means.  Apple, so long as 3rd party developers play their role, could easily capitalize on the new phenomenon that was introduced by the Wii – gaming that involves movement, not just button mashing.  This is something that Wii owners love, and something that has driven sales of the Wii right out of the gate.  This new spin on gaming can easily find a home on the iPhone/Touch devices.  Apple would be bringing this gaming revolution to the mobile market, something that no other mobile gaming device has really captured as of yet.  There needs to be a Wii of the mobile gaming market, and the iPhone can do it.  Catchy, fun, simple games are what people want and crave, being able to do that on the go is something that Apple can focus on.  Dare to be different, think different, and the end result will be success.  Certainly the iPhone/Touch has the power to be a gaming device.

John Carmack, cofounder of ID software, “admits that graphics memory could be a limiting factor, he describes the phone’s hardware as equivalent to a Dreamcast and almost on par with a PlayStation 2 and the original Xbox. He also sees it as far superior, at least in terms of raw specs, than the two big dedicated handheld consoles out there, saying that is ‘more powerful than a Nintendo DS and PSP combined'”(Engadget). Far superior you say?  This is coming from someone in “the know.”  The power is there, and the possibilites are definitely intriguing when we think about what kind of games can come to a device that has the kind of power that John Carmack suggests.

The distribution and the market.

The market exists.  Steve Jobs has predected 10 million iPhones sold this year, and to date they have sold 2.3 million units in the first quarter, and 1.7 million units in the second quarter.  In 2007, the DS sold just over 6 million units, which was more than double the number of PSPs sold in the same year in North America.  So far the number of iPhones sold in two quarters this year has matched the number of units sold by one hand held gaming competitor last year in its entirety, and is closing in on the numbers for the other.  Sure this years comparison to last years handheld device numbers may be Apples to oranges, but for a device that has been out for just over a full year, it’s still pretty darn impressive.  Most people argued that the Wii wouldn’t hold its own against the other devices when it first came out, but somehow the device is outselling the others still.  People are saying that the iPhone can’t compete with current hand held gaming devices, but when I look at the numbers, I see a lot of people with a device in their possession that could theoretically give them an outlet for quick game playing satisfaction.  Would you prefer to pay 10.00 for a game on an iPhone that you currently own and carry with you, or would you rather buy another device that you’ll have to carry with you to meet your gaming fix when the desire arises.  If all things were equal and Final Fantasy IV came out simultaneously on the DS, the PSP, and the iPhone and you could only afford one device, which would you choose as a consumer?  If you currently own an iPhone and a DS, would the DS still win out?  I would opt for the iPhone.  I’m a gamer. I’m not hardcore. I game for pleasure and escape, not to be the best at it.  I think I fit the general public demographic. I fit the mold. I’m Joe consumer – the biggest slice of the gaming pie.  Sure, it won’t be a one to one conversion rate as I’ve suggested above, but if Steve Jobs is even remotely close to his prediction, a lot of casual gamers could be in the wings for Apple.

What about game distribution?

It’s pretty simple.  Would you rather go and sift through the insane panic inducing lines of a Walmart, or would you rather buy the game through iTunes or the App store on your own device.  I think it’s a no brainer, unless you enjoy sweaty palms and panic attacks in public. There is one major hurdle that the current market system for the iPhone has that developers are not going to like–the 70-30 split.  I’m not going to begin to analyze and comment on that in this article, aside from pointing out that it is something that would keep major game developers skeptical about hopping into bed with Apple.  But, if an EA or Blizzard came knocking on Apple’s door with complaints, I’m certain that these heavy hitting game developers could, and likely would, get a better deal than most of the other 3rd party developers.  It would be in Apple’s best interest to get those games on their devices.

Will this year be the year that Apple’s iPhone takes on the gaming industry?  It’s doubtful, but a revision or two down the road, the gaming industry might just be revolutionized by a company that is well known to revolutionize consumer electornic markets: Apple Inc.