It's not so much technical as business focus. There's a big issue with their app store cut on in-app purchases and whether they want to set a precedent on lowering/changing the rules to be compatible with games like Fortnite and the third party stores (like Steam and whatever Epic's is called). If they found a solution to that then they need high quality and timely ports, that's a whole organization of marketing, bizdev, devrel, etc people.

At a technical level it seems like they could get more console-like levels of tuning for their platforms. Very few chips to support, only a handful of thermal targets, all chips have a common CPU/GPU architecture, all devices have very fast storage. Conceivably they could field a winning platform for competitive gaming.

My guess is they look at Sony & Microsoft and don't see much value in reshuffling priorities to likely just be #3.

Edit: hajile above convinces me that rather than concerns about spending money to be #3 they probably already are in the top few by gaming revenue and could have lots of reasons for not being more aggressive about taking more share.