How gaming could be huge for Apple’s business

Apple (AAPL) may soon jump into the gaming space. According to a report by Cheddar, the iPhone maker is working on a subscription service that would charge users a recurring fee to access a selection of video games.

There are still a number of unknowns when it comes to the reported service including what kinds of games it will feature, whether it will focus solely on mobile titles, and how much it will cost.

The move, however, is important for two reasons: It would give Apple yet another service to lean on as it turns its attention to building up that side of its business to offset the slowdown in iPhone sales growth, and it illustrates how gaming is becoming an increasingly important business for more tech companies.

Apple’s services are the future

Apple’s iPhone is the centerpiece of its empire. Without it, the company likely wouldn’t be the dominant force it is today. But as iPhone sales growth has begun to flatten, the company has pushed for its services business to take over as its next great driver.

With roughly 2 billion iOS devices shipped worldwide, Apple has a massive built-in user base for its services. In fact, in 2017, Apple CEO Tim Cook said he wanted to double the services business by 2020. In Q4 2018, the company reported services revenue of $10 billion. That puts Cook’s goal of roughly $14 billion per quarter from services well within reach.

[Read More]