Apple Cancels Arcade Game Projects As It Seeks Greater Engagement - Report

Apple has reportedly canceled contracts for upcoming Apple Arcade games, asking developers to make games that can fuel more long-term engagement and retain subscribers.

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Apple is reportedly shifting its Apple Arcade subscription strategy, attempting to lean in on games that will retain its subscriber base.

Bloomberg reports that the company has scrapped some development contracts with game studios. Developers involved say they were told their games didn't have a level of "engagement" that the company is looking for, as it seeks to keep users subscribed over a longer period of time. Developers also noted that Apple specifically cited Grindstone as an example of the type of game it wants to see more on the service.

In a statement, Apple said it has always planned to make changes to its lineup based on feedback. The company has not shared metrics for Apple Arcade performance publicly, but developers have said the moves could signal that subscriber growth has been slow and those who sign up for the free trial aren't retaining their subscriptions.

Apple reportedly paid studios based on development milestones they had already hit, but some studios were faced with sudden financial difficulties due to the canceled contracts.

Apple Arcade is a $5 per month subscription service, and it eschews free-to-play mechanics like in-app purchases. That has made it a nice catalog of standalone experiences, but many of those F2P mechanics also go hand-in-hand with encouraging long-term engagement in mobile games.

On the whole, though, Apple's services division is doing very well. The App Store, and especially the in-app purchases, helped the division generate about 23% of total sales in Apple's most recent quarter.

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