Analyst: Apple Considering Game Industry Moves?

Following the announcement of games for the iPod earlier this year, analyst Jesse Tortora of Prudential has released a research note suggesting more game-related products could be imminent for Apple. According to the note, excerpted on the Apple Insider weblog, Tortora is speculating both about further handheld moves and the possibility of console-like hardware from the company: "The game console device could be morphed out of some combination of the MacMini and iTV, while the handheld player could be developed as an enhancement to a future version of the widescreen iPod." Interestingly, Tortora points out that the fight for the 'digital home' underlies a lot of the console-related issues, with both Microsoft and (in due course) Sony making movies and TV shows available for digital download on the Xbox 360 and PlayStation 3, a possible threat to the iTunes service in the longer-term. Apple will debut the iTV next year, a media device designed to sit underneath the television and stream/download media such as photos, video, and audio to it. Tortora comments that Apple may need to compete with the PS3 and Xbox 360 for the central place in the digital home, but also cautions the company against producing a more complex game/media console. In particular, he warned: "The video game console market is notorious for subsidizing hardware to sell profitable games... Apple would then have to either rely on the sales of its games and downloadable movies to make enough profit to cover losses on hardware or figure out a strategy to make profits on hardware itself." However, it is far from sure how far down the path of hardware Apple might be going - Tortoria noted that Apple has recently hired game developers at both the software and hardware levels, but did not specify a particular project they might be working on other than the already-known iPod and iTV lines.