Since 2007′s release of the iPhone, Nintendo has adamantly opposed the device in favor of its own mobile consoles, much as they’ve done with every competitor’s hardware in the past. And Nintendo has a legacy to stand on, with the NES and SNES and even the N64. But things kind of break down after that, as competitors moved to optical media and basically left Nintendo in the dust. With the Gamecube, Nintendo attempted to get back in the game, but it wasn’t until the Wii that they were finally back in the good graces of the gaming populace. But even that momentary lack of judgement on our part has faded, as Nintendo’s ability to capitalize on the Wii’s innovations leave us with a few nice gimmicks, but ultimately little staying power.

The argument for Nintendo has been two-fold:

1. Nintendo will use the momentum of the Wii to finally offer competitive hardware in their next console.
2. Nintendo still has the mobile gaming market locked down.

Early reports of the Wii successor leave little to drool over, and the mobile market has slowly been pushed into iPhone territory, even though Nintendo ironically called it a novelty. It’s one thing for Nintendo to have dismissed the iPhone in 2007, but year after year is no longer excusable, especially when their countermeasures are a poorly performing 3D Gameboy. Nintendo’s now no longer leading much of anything, other than a steady march to the grave, much as SEGA did when they fell over thanks to the Dreamcast flopping.

There are investor calls for Nintendo to develop for iOS, but we’re still seeing push-back. It’s the same stubborn push-back that Nintendo of America has been cooing for the last couple years, and now it’s coming straight from Japan. “No, we want our software to run on our hardware.” Nintendo must be quoting a long-lost SEGA exec. The problem is that Nintendo’s hardware is, in a nutshell, crap.

Nintendo does one thing well: it makes great games. Old ports would be wonderfully on the iPhone, let alone new games using Nintendo IP. It’s a no-brainer to bring these titles over, and if Nintendo really wanted to brand some hardware to go along with it, we’d gladly support an iPhone sleeve with hardware bluetooth controls to go along with it.¹

If Nintendo doesn’t wake up soon, they’ll be forced to go this route anyway. Why not capitalize on the transition early instead of blowing more capital on failed hardware projects?

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Despite Apple’s sordid foray into the video gaming market with the ill-fated Pippin, TUAW’s Mike Schramm believes that Apple is willing to give console gaming another go. His speculation is based in large part on a piece by Erik Sherman at BNET, in which Sherman notes various patents Apple filed, and various individuals Apple hired, as evidence of Apple’s gaming console initiative.

No TV console aspirations.

We’ll address Schramm first, by noting that an escapade into console-gaming-land would be a horribly poor move for Apple. Apple’s success with the iPod, and later the iPhone, was due to them being able to put a decently-priced but amazingly polished device into consumer’s hands. Before the iPod, mp3 players weren’t particularly notable aside from the fact that they existed at all. Apple pretty much defined the portable mp3 market, and arguably, created the mainstream movement towards legal mp3 downloads. With the iPhone, Apple entered a market densely packed with crappy phones, where even the best sported comparably poor user interfaces and little real online functionality. With the AppStore, Apple blew the doors open on downloadable content, and once again redefined a market, now being emulated by contenders.

The console market is nothing like the portable music or cell phone markets were before Apple got involved. The console market consist of only three key players, all of whom do a great job at building systems, and all of whom have significant industry backing in the form of third-party titles. Plus, all have an indy developer component, and significant mindshare among consumers.

That’s not to say that Apple couldn’t be successful by entering the console wars, but their timing would be way off. Releasing a console before circa 2013, when Microsoft, Nintendo, and Sony will reveal their latest offerings, would be dooming an Apple console to irrelevance in only four years time. Furthermore, Apple would fight an uphill battle, akin to what Microsoft dealt with when they unveiled the original XBox. Only, Apple’s experience with the mainstream gaming market (Microsoft had years of experience dealing with PC gaming), is virtually null prior to the proliferation of iPhone games. Simply put, the console marketplace is too volatile a place for Apple to push itself into – the competition is too fierce, so why take an unnecessary risk? Apple is better suited to define a market with much less competition, and the handheld gaming market is a prime target.

The accidental success.

We’re not so sure that Apple expected to be successful with iPhone gaming. Surely, Apple expected to find games developed for the iPhone, but titles from big-name publishers using big-name IP? Maybe Apple even built the iPhone hardware to be capable of running games with decent graphics and framerates, but the very lack of input options makes us question Apple’s expectations that the iPhone might become a veritable Gameboy and PSP competitor. But here we are: leveraging the AppStore’s framework, the iPhone is able to market pretty amazing games via a convenient, cutting-edge distribution model, all for a much cheaper price than games released for the Gameboy or PSP. Like the proliferation of the Wii, iPhone gaming is build on a solid foundation of more casual titles, but as time goes on, we’re now seeing more and more “mature” titles requiring more of a user’s focus. It’s one thing for Apple to have given Mac gaming a mere head-nod in the past, it’s another for Apple to dismiss a clearly growing phenomenon. So, Apple will continue embracing iPhone gaming, and that’s at the heart of Sherman’s observations.

The acquisition of Bob Dreblin, Raka Koduri, Mark Papermaster, and Richard Teversham, might not even indicate Apple assembling a “dream team” for the iPhone gaming market, but let’s assume this to be true. Dreblin’s contribution to the Gamecube CPU may be most telling: the Gamecube was underpowered compared to offerings from Microsoft and Sony, but the thing was admittedly compact. If anything, the rest of the team would play into embedded gaming just as easily as they would in traditional console gaming, not to mention Apple’s acquisition of PA Semi and their investment in PowerVR. If Apple’s going to be serious about iPhone gaming, they’ll want to develop hardware specific for that purpose, especially since this kind of specialized hardware will still be able to power the thousands of non-gaming iPhone applications. By controlling the hardware supply chain specifically, Apple ensures that the competition won’t be building similar products, and furthermore, secures its hardware from additional vulnerabilities.

Sherman makes some good observations about Apple’s patent filings. If anything, it should be pretty clear that Apple is looking to link gaming and outside media. Much as iTunes can suggest music based on one’s existing music library, application 20080076495 proposes similar functionality, only rather than just making recommendations, games could identify appropriate music to play based on a user’s preference. For example, a scene in a game calling for fast-paced, action-packed combat, may query a user’s music library for metal or hard rock music, and based on the user’s ratings, will play a top song in that category. In other words, games will be minimally tailored to suit the user’s tastes based on other media they own. The patent application, at absolute minimum, forms an extension to the iTunes store, in that games may be recommended based on songs a user owns: lots of metal songs may mean a user prefers more action-oriented games, for instance.

The other patent applications Sherman identifies give further insight into Apple’s direction with iPhone games, but it should be pretty clear by now that Apple is looking at solidifying the iPhone game user-base. Arguably, Apple is already ahead of the game with their application distribution model, as Nintendo and Sony are now moving ahead with their own online stores. The difference is that the iPhone is a more flexible system, is nearly always connected to the internet, and meets an application price-point easily suited for growth. By the time the AppStore starts including games costing $20 or higher, the handheld gaming market will be a shitstorm of competition, because Apple will have become a major contender well before that, assuming the next iPhone version further advances a long-term gaming plan (and the 3GS appears to herald this). At that time, Nintendo and Sony better have stepped up their game, because unlike with the traditional console market, the handheld market is far more malleable, especially when the iPhone’s chief gaming success is drawing spontaneous buyers into a web of easily-accessible, easily-downloadable content.

So for those longing for an Apple console, look no further than your iPhone. While it’s already successfully integrated the iPod and cell phone, it’s now looking to devour your friendly neighborhood Gameboy, too.

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