Expansion

The video game has experienced growth consistently since its conception in the early 1980's. Retail sales of video games in the US were over $7 billion in '05, up from $2.6 billion in '96. Unit sales increased from 74.1 million in 1996 to 250 million in 2006. The idea that the industry will continue to grow is undeniable. Our society has become more dependant on technology year after year and as both parents continue to go into the workplace our youth grow up playing video games or surfing the internet exponentially more and more. The video game industry is even making strides in Asian countries, as they are showing tons of potential.

Apple is even looking into coming into the home console industry. The concern that Apple does have going into the industry is that companies that sell video games generally take losses with the hardware they sell and make up that profit with software. Apple has always made profit off of selling the actual devices therefore they would either need to develop profitable games or somehow make profits on the systems themselves. I think that Apple would thrive in the industry because they have such a trusted name in technology. They have shown that they can expand into different industries and be extremely successful already. Going into an industry that has shown constant growth just seems to make sense. I believe that if Apple could extend into this sector of the entertainment world that they could dominate the home entertainment field. Especially with the global market of video games expanding at an even faster pace than the American market. The problem a lot of American developers are having with the growth overseas is converting games to sell in their respective cultures. Being new to the industry and with how global Apple is already they could easily look into developing games specific to certain cultures, allowing them to not only be a force in the American market but dominate the overseas market. In a way they could become very much like Coca-cola, who overall dominates the market against Pepsi despite Pepsi having the larger marketshare in the US. I understand the risks Apple sees in entering this industry but if done right would be well worth the reward.