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Apple estimated to earn more from gaming than Sony, Microsoft and Nintendo​

Analysis suggests games generated $8.5 billion for App Store in fiscal 2019 alone

A new report suggests Apple is generating more revenue from video games than the three console platform holders -- despite not directly producing games or making games-specific hardware.

That's according to a Wall Street Journal analysis, which explored the profitability of the iOS App Store and gaming's contributions towards that.

The article cites Sensor Tower estimates that Apple received $15.9 billion from the App Store during the company's fiscal 2019 (October 2018 to September 2019).

Based on Apple's operating margin calculations, which were revealed during the Epic vs Apple trial earlier this year, the operating profit for the App Store was $12.3 billion that year -- accounting for almost a fifth of the company's overall profit.

Sensor Tower estimates that 69% of those revenues (just shy of $11 billion) came from gaming.

The WSJ's own analysis claims that Apple would have earned $8.5 billion from gaming, which it reports is $2 billion more than the operating profit generated during the same period by Sony, Nintendo, Microsoft and Activision.

The site based this on public financial records from Sony, Nintendo and Activision, and an estimate on Microsoft.

Apple disputed the operating margins during the trial and claimed they were inaccurate. CEO Tim Cook told the court the company never calculated the exact profitability of the App Store, and that the margins discussed were from a "one-off presentation."

However, he did confirm the majority of App Store revenue comes from games.

Sensor Tower estimates global spend on mobile games through the App Store reached $45 billion in fiscal 2020.

Last month, Judge Yvonne Gonzales Rogers revealed her judgment for Epic vs Apple, ruling that the latter was not a monopoly and sided with Apple on nine out of the ten counts in Epic's lawsuit.

The judge also sided with Apple's counterclaim that Epic Games breached it contract by introducing direct payments to Fortnite via a hotfix.

Epic is appealing against the ruling.

Source: Game Industry

My Paint skills are unrivalled!

 

[phil_t98]

Apple estimated to earn more from gaming than Sony, Microsoft and Nintendo​

Analysis suggests games generated $8.5 billion for App Store in fiscal 2019 alone

A new report suggests Apple is generating more revenue from video games than the three console platform holders -- despite not directly producing games or making games-specific hardware.

That's according to a Wall Street Journal analysis, which explored the profitability of the iOS App Store and gaming's contributions towards that.

The article cites Sensor Tower estimates that Apple received $15.9 billion from the App Store during the company's fiscal 2019 (October 2018 to September 2019).

Based on Apple's operating margin calculations, which were revealed during the Epic vs Apple trial earlier this year, the operating profit for the App Store was $12.3 billion that year -- accounting for almost a fifth of the company's overall profit.

Sensor Tower estimates that 69% of those revenues (just shy of $11 billion) came from gaming.

The WSJ's own analysis claims that Apple would have earned $8.5 billion from gaming, which it reports is $2 billion more than the operating profit generated during the same period by Sony, Nintendo, Microsoft and Activision.

The site based this on public financial records from Sony, Nintendo and Activision, and an estimate on Microsoft.

Apple disputed the operating margins during the trial and claimed they were inaccurate. CEO Tim Cook told the court the company never calculated the exact profitability of the App Store, and that the margins discussed were from a "one-off presentation."

However, he did confirm the majority of App Store revenue comes from games.

Sensor Tower estimates global spend on mobile games through the App Store reached $45 billion in fiscal 2020.

Last month, Judge Yvonne Gonzales Rogers revealed her judgment for Epic vs Apple, ruling that the latter was not a monopoly and sided with Apple on nine out of the ten counts in Epic's lawsuit.

The judge also sided with Apple's counterclaim that Epic Games breached it contract by introducing direct payments to Fortnite via a hotfix.

Epic is appealing against the ruling.

Source: Game Industry

My Paint skills are unrivalled!

When you look at how many mobile devices there are and the games on them it isn’t surprising but its only and estimate to be fair

 

[Robb]

I had the impression that they already did earn more, but good for them I guess.

How much does google/Android earn? That seems like a more interesting comparison than Sony/MS/Nintendo.

 

[Heisenberg007]

Makes me really sad, when companies like Sony spending billions of dollars in making high-quality AAA games with proper voice acting, mo-cap, direction, narrative, music, and sound design, and here mobile games are raking in more profitability that rarely has any effort except monetizing the hell out of it.

Also instills a fear in me that big publishers like Sony, Microsoft, and Nintendo may eventually give up on the games we love and enjoy and just adopt this model completely because it's more profitable and way less risky.

I don't want that future. Gaming is one of the very few things that give me immense enjoyment. Games like God of War, TLOU, RDR 2, Hades, Returnal. I don't want it to end.

 

[SoloKingRobert]

I had the impression that they already did earn more, but good for them I guess.

How much does google/Android earn? That seems like a more interesting comparison than Sony/MS/Nintendo.

Android is an open platform, unlike IOS

 

[phil_t98]

Makes me really sad, when companies like Sony spending billions of dollars in making high-quality AAA games with proper voice acting, mo-cap, direction, narrative, music, and sound design, and here mobile games are raking in more profitability that rarely has any effort except monetizing the hell out of it.

Also instills a fear in me that big publishers like Sony, Microsoft, and Nintendo may eventually give up on the games we love and enjoy and just adopt this model completely because it's more profitable and way less risky.

I don't want that future. Gaming is one of the very few things that give me immense enjoyment. Games like God of War, TLOU, RDR 2, Hades, Returnal. I don't want it to end.

So sad for Sony? These games are not competing with hose games, game like that are always better but the mobile market is massive and these the game you play while waiting in the car or travelling by train or bus. There is a market for both so dont feel sorry for Sony as they are raking it in to

 

[Topher]

I had the impression that they already did earn more, but good for them I guess.

How much does google/Android earn? That seems like a more interesting comparison than Sony/MS/Nintendo.

Google Play had $11.2 billion in revenue compared to $15.9 for Apple

https://www.reuters.com/technology/...reached-112-bln-2019-lawsuit-says-2021-08-28/

 

[Spukc]

good for them.
if nintendo playstation and xbox gaming becomes that. I am glad i have all my old shit.

 

[Fahdis]

Makes me really sad, when companies like Sony spending billions of dollars in making high-quality AAA games with proper voice acting, mo-cap, direction, narrative, music, and sound design, and here mobile games are raking in more profitability that rarely has any effort except monetizing the hell out of it.

Also instills a fear in me that big publishers like Sony, Microsoft, and Nintendo may eventually give up on the games we love and enjoy and just adopt this model completely because it's more profitable and way less risky.

I don't want that future. Gaming is one of the very few things that give me immense enjoyment. Games like God of War, TLOU, RDR 2, Hades, Returnal. I don't want it to end.

Then they need to make products a and store that appeals to the casuals, however it also keeps on help to fund AAA for us people, I mean the future is either Mobile or Cloud or a mix of both. Proprietary machines in your home will be a thing of the past. You will own nothing and enjoy it. The only legacy you will have is a futuristic controller, a screen or VR/AR glasses.

 

[BlackM1st]

Genshin Impact alone made 2 billions in 1 year so I'm not surprised.

 

[laynelane]

Makes me really sad, when companies like Sony spending billions of dollars in making high-quality AAA games with proper voice acting, mo-cap, direction, narrative, music, and sound design, and here mobile games are raking in more profitability that rarely has any effort except monetizing the hell out of it.

Also instills a fear in me that big publishers like Sony, Microsoft, and Nintendo may eventually give up on the games we love and enjoy and just adopt this model completely because it's more profitable and way less risky.

I don't want that future. Gaming is one of the very few things that give me immense enjoyment. Games like God of War, TLOU, RDR 2, Hades, Returnal. I don't want it to end.

I tend to think the market for mobile and console/PC games are two different markets so we don't have to worry about that too much. At least, I hope it's that way. I, like you, really love gaming and a future consisting only of mobile games wouldn't have anything for me.

 

[Con_Z_ǝdʇ]

Makes me really sad, when companies like Sony spending billions of dollars in making high-quality AAA games with proper voice acting, mo-cap, direction, narrative, music, and sound design, and here mobile games are raking in more profitability that rarely has any effort except monetizing the hell out of it.

Also instills a fear in me that big publishers like Sony, Microsoft, and Nintendo may eventually give up on the games we love and enjoy and just adopt this model completely because it's more profitable and way less risky.

I don't want that future. Gaming is one of the very few things that give me immense enjoyment. Games like God of War, TLOU, RDR 2, Hades, Returnal. I don't want it to end.

All of them are at least committed to higher production values for another generation and i hope another one will follow. If you would go by raw numbers it would make sense to expand in the mobile gaming market or leave AAA gaming behind completely. The fact that they haven't, gives me hope that they have some integrity.

 

[killatopak]

The future looks bleak.

 

[Heisenberg007]

So sad for Sony? These games are not competing with hose games, game like that are always better but the mobile market is massive and these the game you play while waiting in the car or travelling by train or bus. There is a market for both so dont feel sorry for Sony as they are raking it in to

Not feeling sad for Sony, but for the future of gaming. Read my post again.

There is a possibility that big companies (like Sony) just abandon their gaming philosophy and instead go all in on mobile games because it's more profitable (results in this thread) and less risky.

 

[Heisenberg007]

I tend to think the market for mobile and console/PC games are two different markets so we don't have to worry about that too much. At least, I hope it's that way. I, like you, really love gaming and a future consisting only of mobile games wouldn't have anything for me.

They are very different. But how long until one exec gets the light-bulb moment and says "if mobile gaming is more popular, why not we make that our primary model and spend 80% of our resources on?" That's what I am afraid of and that's why I don't support these money-driven mobile games. I never play or pay for them.

 

[phil_t98]

Not feeling sad for Sony, but for the future of gaming. Read my post again.

There is a possibility that big companies (like Sony) just abandon their gaming philosophy and instead go all in on mobile games because it's more profitable (results in this thread) and less risky.

I read your post properly, there is a world where both types of game co-exist . We still want our epics like god of war but we still want our little phone games to pass the time till we get back to serious gaming. As long as the games are good people will still buy and play them

 

[Coolwhhip]

Because they take a huge cut, which makes it more expensive for the consumers. Great...

 

[phil_t98]

Because they take a huge cut, which makes it more expensive for the consumers. Great...

Same cut Microsoft/sony and Nintendo take when we buy off their stores

 

[BlackM1st]

But how long until one exec gets the light-bulb moment and says "if mobile gaming is more popular, why not we make that our primary model and spend 80% of our resources on?"

It will happen sooner or later. Ms has the right idea of making a marketplaces out of the Xbox. It's just the technology is not there yet. The moment clouds will become more powerful and 5G or its successor will become widely available everyone would move there as there would be no need for any boxes be it PS, Xbox or even gaming PC.

 

[Griffon]

And yet their store is absolute dogshit.

 

[laynelane]

They are very different. But how long until one exec gets the light-bulb moment and says "if mobile gaming is more popular, why not we make that our primary model and spend 80% of our resources on?" That's what I am afraid of and that's why I don't support these money-driven mobile games. I never play or pay for them.

That is a terrible what-if scenario, for sure. It seems we're in a state of co-existence for now, though. I'm thinking of how Sony has a mobile division, for example, but is still committed to making games as they always have. I can definitely see some short-sighted person having the idea of going all-in on the mobile market, but hope that companies have enough sense and market research to understand that there are two different audiences at play here.

 

[balt1kr1s]

There is an estimate with around 700 milion Iphones in use globally.

Potential playerbase is enormous, so not that much of a surprise for me.

 

[Haggard]

Mobile gaming is a financial behemoth for the store owners, not so much for most of the game producers though.

 

[Mownoc]

This seems very misleading. "the operating profit for the App Store was $12.3 Billion." What expenses do they have under "App Store" because I'm sure R&D isn't on that.

Apple Gaming Revenue - $11 Billion
Apple Gaming Profit (Estimate) - $8.5 Billion
PlayStation Revenue (2020) - $22.7 Billion
PSN Revenue (2019) - $12.48 Billion
PlayStation Operating Profit (2020) - $3.33 Billion

So PlayStation had over twice the revenue for gaming than Apple, even if we take out hardware PlayStation still has more revenue. (PSN Revenue in 2019 was $12.48 Billion).

Nintendo/Sony/MS have lots of expenses from hardware and software development and manufacturing that bring down their operating profit, while this $12.3 billion "App Store" operating figure from Apple includes very little of their expenses.

If we looked at only "PlayStation Store" operating profit and revenue it could be higher than Apples "App Store" operating profit and revenue because all the expenses wouldn't be included.

 

[Tiago Rodrigues]

Makes me really sad, when companies like Sony spending billions of dollars in making high-quality AAA games with proper voice acting, mo-cap, direction, narrative, music, and sound design, and here mobile games are raking in more profitability that rarely has any effort except monetizing the hell out of it.

Also instills a fear in me that big publishers like Sony, Microsoft, and Nintendo may eventually give up on the games we love and enjoy and just adopt this model completely because it's more profitable and way less risky.

I don't want that future. Gaming is one of the very few things that give me immense enjoyment. Games like God of War, TLOU, RDR 2, Hades, Returnal. I don't want it to end.

Sony is already betting on mobile games. They have a mobile division and everything.
I wouldn't worry tbh.

As we speak both Sony and MS are boosting their 1st party studios in every way for AAA titles production.
That's not changing anytime soon.

 

[martino]

but

 

[Skifi28]

But how long until one exec gets the light-bulb moment and says "if mobile gaming is more popular, why not we make that our primary model and spend 80% of our resources on?" That's what I am afraid of and that's why I don't support these money-driven mobile games. I never play or pay for them.

Apple isn't making mobile games, they have a walled garden on hundred of million on devices and that's how all that money was generatee. Sony and any other single company can't do that, just making all their games mobile wouldn't even come close to that. It's not happening because it can't.

 

[ZywyPL]

Makes me really sad, when companies like Sony spending billions of dollars in making high-quality AAA games with proper voice acting, mo-cap, direction, narrative, music, and sound design, and here mobile games are raking in more profitability that rarely has any effort except monetizing the hell out of it.

IMO mobile games are the prime example that at the end of the day, it's the gameplay that matters first and foremost in video games, everything else is just a nice bonus, but if the sole act of playing the game isn't fun, then something went wrong. Mobile games also clearly show that people will gladly pay a buck or two every now and then, even if it means hundreds of dollars a year, than 50-70$ upfront.

But also keep in mind that all those ads you get every 3-5min. also add to the revenue, a lot actually, and I think everyone here agrees that's something we don't want to see in fully paid titles. Maybe someday someone will figure out a hybrid solution where you get paid upfront but then have additional source of constant income, that doesn't piss people off.

 

[lh032]

If Sony goes for mobile gaming ,i dont care how much money they make , ill quit gaming.

 

[RoboFu]

If Sony goes for mobile gaming ,i dont care how much money they make , ill quit gaming.

‎God of War | Mimir’s Vision

‎Bring God of War’s world into yours with the Mimir’s Vision app an AR experience that reveals the legends of Midgard. Tap, zoom, and lock the map, then touch the points of interest to learn the lore behind this realm of many mysteries. Mimir, a man who’s seen it all, will guide you from The...

apps.apple.com

They are already there.

 

[lh032]

‎God of War | Mimir’s Vision

‎Bring God of War’s world into yours with the Mimir’s Vision app an AR experience that reveals the legends of Midgard. Tap, zoom, and lock the map, then touch the points of interest to learn the lore behind this realm of many mysteries. Mimir, a man who’s seen it all, will guide you from The...

apps.apple.com

They are already there.

i mean abandon console gaming completely and go for 100% on mobile gaming, i do know they already have mobile games and planning to expand into mobile market.

Im still happy with my PS5 actually.

 

[FStubbs]

If Sony goes for mobile gaming ,i dont care how much money they make , ill quit gaming.

Sony already makes more from Fate: Grand Order than they do any of their other games. They clearly aren't abandoning their other games for just FGO.

 

[lils]

there needs to be a different word in the english language for mobile gaming compared to real gaming

 

[RoboFu]

i mean abandon console gaming completely and go for 100% on mobile gaming, i do know they already have mobile games and planning to expand into mobile market.

Im still happy with my PS5 actually.

I actually thought “ PlayStation mobile inc “ was a fake account. I mean it sounds fake..

 

[LiquidMetal14]

This isn't new news.

But I get the reporting and necessity to state the fact that a company like Apple makes money on their platform.

 

[prinz_valium]

Ah profits.
Of course. They have nearly 0 expenses

 

[Closer]

Mobile Gaming is the future. If/when console gaming is gone, mobile gaming will not resemble what is right now, so I don't understand people that think when it's done, it's not gonna be "real gaming".

 

[TheContact]

mobile gaming isn't going to replace console gaming (though I think VR will be the new "console" gaming even if you're stationary on your couch); it's just that the potential for mobile devices to generate revenue is vastly greater than the potential for consoles due to the prolificity of smartphones and microtransactions, which do exist on consoles, but not nearly to the level they exist on mobile gaming. the two will co exist for a while

 

[SpokkX]

good for them.
if nintendo playstation and xbox gaming becomes that. I am glad i have all my old shit.

Pretty much this

mobile gaming is as interesting as Horse jumping is for me - it is not related to my hobby of ”gaming” in any way

 

[Neofire]

I'm pretty sure they will considering they don't give a damn about the integrity of the video game industry. Apply is purely out to make a dollar, by any means necessary.

That and 99.3% of mobile games are about milking money out of you for everything you do and see.

 

[CobraAB]

Shitty gaming is a thing I guess?

 

[Topher]

Shitty gaming is a thing I guess?

 

[tommib]

Makes me really sad, when companies like Sony spending billions of dollars in making high-quality AAA games with proper voice acting, mo-cap, direction, narrative, music, and sound design, and here mobile games are raking in more profitability that rarely has any effort except monetizing the hell out of it.

Also instills a fear in me that big publishers like Sony, Microsoft, and Nintendo may eventually give up on the games we love and enjoy and just adopt this model completely because it's more profitable and way less risky.

I don't want that future. Gaming is one of the very few things that give me immense enjoyment. Games like God of War, TLOU, RDR 2, Hades, Returnal. I don't want it to end.

There’s room for everyone. The industry keeps growing. We’ll be fine.

 

[tommib]

Shitty gaming is a thing I guess?

There’s nothing shitty about Apple Arcade and this as a controller:

 

[tommib]

Android is an open platform, unlike IOS

So basically full of piracy?

 

[Denton]

Apple and Google should just be dissolved. By violence if necessary.

 

[yurinka]

I had the impression that they already did earn more, but good for them I guess.

How much does google/Android earn? That seems like a more interesting comparison than Sony/MS/Nintendo.

Google Play had $11.2 billion in revenue compared to $15.9 for Apple

https://www.reuters.com/technology/...reached-112-bln-2019-lawsuit-says-2021-08-28/

We have to remember that Google Play is only one of the stores available in Android, since it's open. In Asia there are other Android stores that are more popular there. As an example in China the most popular one is the Tencent one.

mobile gaming isn't going to replace console gaming (though I think VR will be the new "console" gaming even if you're stationary on your couch); it's just that the potential for mobile devices to generate revenue is vastly greater than the potential for consoles due to the prolificity of smartphones and microtransactions, which do exist on consoles, but not nearly to the level they exist on mobile gaming. the two will co exist for a while

Mobile gaming already is a way bigger market than console regarding amount of user and amount of revenue generated. And not only is the biggest gaming market, it's also the fastest growing one. This doesn't mean it's going to replace consoles or that consoles are dissapearing: console gaming market continues growing year after year, but way slower than mobile.

If Sony goes for mobile gaming ,i dont care how much money they make , ill quit gaming.

Back in 2007 they made this game, and it wasn't their firs mobile game:

 

[Nikana]

They have more devices out there so it makes sense. This is one of those comparisons that dont make a lot of sense when you consider all of the factors. Just because their number is higher than someone else's that doesn't mean they are doing better business.

 

[Rikkori]

Gaming or gambling? Oh wait..

 

[Punished Miku]

At least Apple Arcade seems to be a positive step for quality in mobile gaming.