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Nine things that caught our attention during WWDC 2011

#wwdc Less meat, plenty of gravy

Nine things that caught our attention during WWDC 2011
Apple may have triggered the clash on the 'event battlefield' thanks to its simultaneous scheduling of WWDC against game industry incumbent E3, but when it came to game announcements, its shock troops were notably absent.

The two-hour WWDC keynote contained less than five minutes of games-talk (minor Game Center updates), despite games being the biggest single App Store category in terms of app volumes and revenue generated, and Apple proudly claiming to be "the biggest games platform in the world".

The validity of that claim not withstanding, it's going to have to work much harder to convince the industry it takes games as seriously as Nintendo, Sony and Microsoft have to.

Still, WWDC wasn't a busted flush, just more about Apple laying a solid foundation for the future, especially in terms of the cloud, so there were some items that caught our attention during the show.

1. Steve Jobs agrees with Stephen Elop

Who would have thought Apple's CEO and ex-Microsoft exec turned Nokia CEO Stephen Elop would say the same thing in keynote speeches a week apart.

At Qualcomm's Uplinq event, Elop stated "We've moved from a battle of devices to a war of ecosystems."

Jobs formulated the same trend, albeit expressed more romantically, when kicking off a keynote completely focused on the interaction between operating systems and cloud storage/distribution. "Hardware is the brains and sinews but software is the soul," he said.

Of course, this is a trend that's emerged throughout 2011; devices are becoming commoditised as touchscreen candy bars, powered by very similar hardware. Aside from their badges (and the freebie iPhone 4 bumpers), they could be interchangeable.

Likewise, the business model is shifting fast to ways of locking users into your ecosystem, something Apple has always done incredibly well, and is accelerating with its new iCloud content syncing and storage/distribution features.

How iCloud will impact games beyond functional features such as enabling saves in the cloud, and 'buy once, get on all your devices' remains to be seen, although HTC's deal with game streaming service OnLive highlights one potential option for an acquisitive mobile-focused CEO to investigate.

2. Cost of entry

There's another significant point to note about the rise of services over hardware: it only strengthens Apple's business model.

Its revenue is funded by the sale of expensive hardware; indeed this is so profitable Apple can easily afford to give away pretty much any services for free.

One example is the way in which Apple is replacing its unsuccessful $99/year MobileMe service with the now free, more extensive iCloud service. It's the same thing with the cloud-based tweaks to iTunes. Effectively, these services, and $1 billion data centers they require, are covered for by the hardware tax you pay to get an Apple device in the first place.

All other device manufacturers operate on a reverse model where hardware is as cheap as possible to gain market share, and services are either subscription-based or monetised by advertising.

Their challenge will be to work out which model they want to adopt going forward. Some, like Google and Amazon, will want to drive as much usage as possible through their existing business models - search and webstore respectively. But the likes of Nokia, Microsoft, RIM, Samsung, Sony Ericsson, HP/Palm etc will have to think carefully about whether they are hardware or service companies.

3. Jeffrey Bernard is Unwell

British journalist Jeffrey Bernard was known for his bohemian lifestyle, which often led to his columns for the Spectator magazine being replaced with the notice 'Jeffrey Bernard is Unwell'.

There's nothing remotely funny about Steve Jobs health, but his continuing gaunt appearance and the metaphorical 'Steve Jobs is Unwell' sign that hangs over his office door, suggests recovery to a situation where he can take over from Tim Cook in terms of running Apple day-to-day is unlikely in the short to medium term.

It's in the interests of Apple as a company, and probably Jobs himself, for the plan of succession to now be put into place.

4. Does Apple have game?

Apple's claim to be the biggest games platform in the world is a stark one, but it's backed up in terms of the number of games available on the App Store - more than 100,000.

News that Game Center now has 50 million users - "More than Xbox Live" Apple points out - is also impressive, although less so as a percentage of a 200 million iOS install base.

Still, it's not clear the company is in any way focused on gaming. Indeed, the one specific gaming mention in the WWDC keynote were minor features for Game Center, including avatar photos, and better social comparison and recommendation features. Of course, games will enjoy new App Store features such as delta update and over-the-air download.

Perhaps the most interesting single point was the integration of 16-player turn-based multiplayer hosted by Game Center; available for running challenges, and hopefully the precursor to a full multiplayer service.

That said, during the keynote Apple execs spent about 20 minutes talking about email clients and three minutes on games.

People expected much, much more, even in terms of Game Center, which has stagnated while rival services such as OpenFeint and Plus+ (now Mobage) are leaping ahead, in terms of their daily user activity, social features, analytics, and the ability to update game content without going through Apple's review process. Even RIM demonstrated it's going to jump into the social mobile game with its acquisition of Scoreloop - the last of big social mobile infrastructure companies previously still in private hands.

One iOS developer told us straight, "Game Center is broken. We just don't use it."

Sure, it's a singular opinion but coming from a developer with over 10 million downloads of its game on iOS, it's one that suggests if Apple wants to boast about being the 'the biggest games platform in the world' it so also be actively doing something about it. A high profile game advocate would be an obvious first move.

5. The app store monolith is fragmenting

App stores are evolving fast, and that's something that can even be seen on Apple's App Store - at least when iOS 5 is released in the autumn.

The ability to download games directly from Game Center, without going into the App Store is a small but important step. Equally, the ability to buy iTunes content and have it automatically downloaded to all compatible Apple devices (up to 10), is a sensible distribution shortcut, and one that will inevitably come to games.

In these regards, Apple is catching up with the likes of Google, which has enabled such frictionless distribution for a couple of months.

More significant for the entire mobile ecosystem however will the combined impact of cloud storage/distribution, as well as the rise of HTML5 and web apps; perhaps the hottest infrastructure technology play at the moment.

The result will be larger, more viral, audience - something that's good for content developers. After all, fundamentally, an app store is just a link to content with various billing mechanisms attached, plus some weak discovery and search options. Frankly, the less mediation and friction from a centralised source, and the more open search and discovery, the better.

6. Mirror, mirror, are Airplay and Apple TV the fairest console of all?

Some people got very excited by the news Apple TV users will be able run their iPad games on their TVs without needing the cable previously required. True the removal of the cable will have a significant impact in terms of ease of use, but cries that 'Apple will unseat the consoles' are wide of the mark.

Sure, internet-enabled TV remains a space plenty of publishers and developers are thinking hard about but Apple will have to ramp up its activity and investment considerably in this area if it wants to get an Apple OS integrated into anything other than a small niche of expensive TVs.

Even at $99, the Apple TV unit is a console; cheap and small and non-games specific as it might be. Removing the need for a separate box is key to mass disruption, and it's a similar situation with Google TV and Samsung's Smart TVs.

And aside from chipsets and operating systems, the fact is the majority of touchscreen games won't translate onto TV without additional work in terms of UI and control: in other words, more fragmentation.

7. Apple soft-acquires Twitter

As you'd expect, there were many rumours floating around before Apple's WWDC keynote. Most involved iPhone 5, while my bet was on Steve Jobs to return to daily CEO duties. Others involved Apple's acquisition of everyone from Zynga, to Facebook, Nvidia, Nokia and Twitter.

Yet to some extent, Apple did acquire the latter, without spending a cent. Adding Twitter integration to all apps in iOS 5 means overnight Apple will become Twitter's biggest driver of traffic, enabling it to data mine that activity, assuming Twitter's server farms can deal with the surge.

Of course, the context is Apple's difficult relationship with Facebook, but this surely makes an official Apple-Twitter deal more likely, especially considering the company's massive cash pile and its lack of data/analytics/insight into the general social web ecosystem.

8. Big numbers and the one million dollar day

As statisticians will point out, the law of big numbers means big news. In that respect, the fact Apple has sold over 200 million iOS devices and passed on over $2 billion to content developers, means the pinnacle of winners will have racked up some big numbers.

And so it's been with Chillingo announcing 140 million iOS game downloads, and Gameloft 200 million. Similarly, Backflip Studios has just announced 100 million iOS and Android downloads, while social freemium outfit Storm8 announced 200 million across iOS and Android.

What's more important in the latter cases is the additional detail of the respectively business models. In the case of Backflip, it's doing one billion ad impressions per month, while Storm8 has done its first one million dollar day in terms of spot revenue.

Significantly, both of these companies are recently new to mobile; both 2009-era start ups that have concentrated on their respective business models and have built out fast in terms of releases. And while both have raised the majority of their downloads and hence revenue from iOS (the download split is 80:20 in Apple's favour), their early support for Android demonstrates that its scale really does matter now.

Whisper it quietly at WWDC, but this ain't a one-horse race no more.

9. Incentivised to do what exactly?

The fallout from Apple's rejection of per download incentivisation (or CPI) continues. What's interesting though is that like an obstacle placed in the path of a line of marching ants, the iOS ecosystem is rapidly rerouting around the ban with plenty of new ideas on things that can be incentivised.

After all, in-game currency is effectively free for developers and publishers to give to users, while advertisers want to spend real marketing dollars driving eyeballs to their products. That basic exchange is key for all mobile ecosystems, and as long as no one is 'gaming' App Store chart position, it seems like there are plenty of other potential activities that can be incentivised.

Hence most commentators expect their revenues from CPI to be replaced substantially, if not overtaken by these new models, over the next three months.
Contributing Editor

A Pocket Gamer co-founder, Jon is Contributing Editor at PG.biz which means he acts like a slightly confused uncle who's forgotten where he's left his glasses. As well as letters and cameras, he likes imaginary numbers and legumes.