Nilay Patel

Let's play that clip because I'm curious to see your reaction to this in the context of the news today.

So I listen to that and I think, well, Nintendo exists.

They seem to be doing just fine without being on phones.

Sony is running what seems like a fine business in the PlayStation without running on phones.

And then right next to all of this, arguably the most interesting category of gaming devices in the past five years is Steam Decks and Steam Deck Alikes, which are all running Windows games better on Linux than on Windows.

And I'm actually kind of at a loss here, right?

There's this desire to put mobile games on Apple's platforms, on Apple's terms, and this very clear statement that if they don't do that, over time, the business will become untenable.

And then the rest of the industry is not doing that at all, and they seem to be fine.

How do you reconcile those ideas?

We say it a lot, and...

but it's always worth pointing out again, the Apple services revenue is not severance.

It's not Ted Lasso.

It's 30% of in-app purchases in games.

Like by far the biggest chunk of Apple's fast growing services revenue is in-app purchases in games.

And they are never going to give that up unless literally the governments of the world demand that they give it up.

If you can buy King and you get Candy Crush and then you can lawyer your way into immediate 30% margin growth, like that's a good play.

It just seems like they couldn't pull it off.

We've talked about Phil as the CEO of Microsoft Gaming, and it's easy and tempting to collapse that to just the Xbox.

We've talked about how it's important now, especially that the Activision deal is closed, that they run a bunch of mobile games too.

They're making some money in mobile.