The Loop quotes The Seattle Times, interviewing Gabe Newell, head of Valve:

Newell expects Apple to disrupt the living room platform with a new product that will challenge consoles, although he doesn’t have any particular knowledge of that new product.

“I suspect Apple will launch a living room product that redefines people’s expectations really strongly and the notion of a separate console platform will disappear,” he said.

I don’t think Apple will offer a new product specifically for gaming, because the building blocks already exist in AirPlay and iOS devices. Firemint’s recently showed off Party Play for Real Racing 2, which works over AirPlay to an Apple TV, enabling four-player split-screen racing on an HDTV, using iOS devices as controllers.

Here’s how I think things will play out for Apple in 2012:

  • The next iPod touch revision will include an A5 chip and, with that, video mirroring/AirPlay gaming support;
  • The Apple TV will retain its price point or perhaps even drop in price;
  • More games devs will take advantage of AirPlay, offering TV modes and multiplayer.

You then end up in an interesting and seemingly somewhat absurd reversal of traditional gaming. With Sony, Microsoft and Nintendo, you have affordable consoles and fairly cheap controllers. With Apple, you have a cheap ‘console’ (the Apple TV, priced similarly to the Wii, but cheaper than an Xbox or PS3), and expensive ‘controllers’, in the shape of iPods, iPhones and iPads. The Apple system isn’t one you’d buy from scratch, but once you realise families will increasingly own several iOS devices, Apple’s system becomes less crazy.

I’m not sure Sony, Microsoft and Nintendo will be significantly challenged by this model, should my three assumptions come to pass, but then people argued iOS wouldn’t get anywhere in handheld gaming, and it’s since punched the DS and PSP squarely in the face.