News Analysis: Apple’s Arcade video game service seeks to upend another business model

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Apple wants people to pay $5 a month for the types of games they have been getting for free, but without ads or in-app purchases.

The struggle for Double Fine Presents to get the first “Psychonauts” released has become the stuff of modern game lore.Apple being Apple, this just might work — or not. Among the Apple watchers on Wall Street, no one seems confident the company can make a mobile-game subscription work, but few predict it will fail. That makes Arcade the get-out-the-popcorn tech product of the moment.

Apple has a generally deserved reputation for transforming consumer behavior or making niche behaviors mainstream. Apple made it commonplace to interact with computers with a mouse and a graphical representation of a desk. Apple wasn’t the first company to chop records up into digital files like MP3s, but it got the music industry on board with the idea and made song downloads easy and appealing for everyone.

Apple isn’t about to dump free video games from its App Store. Consumers spend more than $100 billion a year on app downloads and purchases from Apple, Google’s Android and other mobile storefronts. Mobile video games generate about three-quarters of that, according to App Annie, a mobile data and market analytics firm. Think of Arcade as an add-on to an already big and successful model of free-to-play games.

 

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interesting model. Realistically such a fair pricepoint still but wonder if consumers will take to it.

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