UPDATED: The Apple App Store Economy
Update: Thanks to everyone for weighing in about the infographic. The data used was given to us on an exclusive basis from analytics firm Flurry. Indeed, three-quarters of the apps in the App Store are “paid apps,” which was used to calculate the average app price and the subsequent revenue figures in the previous version. However, only one-quarter of the apps actually downloaded are “paid apps,” so the average price per transaction (paid + free downloads) is actually much lower than the average app price in the store. The graphic has been updated to reflect this price. Also, some of the averages in the Flurry data were calculated using projected user numbers from the first quarter 2010; that has been corrected to reflect only data up to the end of the year.
For clarification purposes, here is the math:
According to Flurry, Average listed price of a paid app: $3.63
74% of apps listed in the app store are paid.
Average listed price of an app (including free): 3.63 x .74 = 2.70 (with rounding)
Only 1/4 of downloaded apps are paid.
Average price paid for an app (including free): 3.63 X .25 = .91
While we make every effort to ensure the accuracy of all the information contained in our posts, sometimes errors make their way onto our site, and this was one of them. We deeply regret any confusion this may have caused. Please accept our apologies.
best, Om
Related GigaOM Pro Research Report: Surveying the Mobile App Store Landscape
Graphic courtesy of Column Five Media
Related research and analysis from GigaOM Pro:
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Wow! what a great way of showing the potential, well done! You guys should check out http://www.appboy.com too they have done a great job of helping developers get discovered.
And thats why we created http://www.appboy.com, the social network for App Developers and Users. There is so much potential here, Awesome post Guys!
I really loved the data and the display of this report! Thanks for being so cool.
Sorry, I am missing something here. Are users dowloading 3.7 paid or total number of applications per month? If it is the former, then total number of downloads (4 times paid) for December are 3.7x4x56M = 828.8 million. Towards end of September Apple announced 2 billion downloads and on Jan 5th Apple announced 3 billion downloads. If about 830 million of them were downloaded in December alone, App Store must have really had a very dry period in October and November. What am I missing here?
I am missing something too. Using the data above, the average paid apps cost $2.59. If 75% are free then the average including free would be closer to $0.65, correct?
So the average iPhone user would spend closer to $2.40/month than $10.
Showing my work!:
.9925+1.996+2.998+3.991+4.993+5.992+6.99*4+9.99=129.5
25+6+8+1+3+2+4+1=50
I think you’re right!
i was thinking the same exact thing..
The average paid app does NOT cost $2.59!!!! Your statement implies you mean for ALL PAID APPS. You read it wrong. In DECEMBER, The average price of apps in the “Top 50 Paid Apps” section just happen to be $2.59.
75% of apps are NOT FREE, but 75% of apps downloaded in December happened to be free.
You had to have failed the whole word problem thing back in school, right?
Why did you show your work? All you did was come one step shy of showing what they quoted (129.5/50= $2.59- the average)
Could you please submit all work showing how you arrived at $2.40 per month? I want to include it in my next board meeting. Thanks.
OMG!!!! I just realized that you were even more wrong than I had previously imagined.
The “one quarter” figure (and it’s inverse, naturally) is in no way related to the $2.59 pricing figure. Multiplying them together gives you nothing more than headache. Did you actually read the piece?
Om, Sincere thanks for taking the time to make corrections to the data. Solid info-graphic. Brand win.
Dear Stupid Irishman,
The figure of $2.40/month came from multiplying the number of apps users downloaded in a month by the average cost of an app, which is the average cost of a paid app multiplied by the percentage of downloaded apps that are not free. It is the same math that Om walks through in the update above. The exact numbers are slightly different because the original data provided by the info-graphic was different. The math is the same.
Why did they go to the trouble to change it those of us who suggested the update are all idiots, failing the whole word problem thing back in school, and OMG this and Cheeto that? STFU.
haha your both wrong
I would assume total.
To quote the above, “iPhone users downloaded an average of 3.7 apps in December, one quarter of which were paid.”
Of course, the interesting part is that one quarter of 3.7 is 0.925. We’ll be nice and round that up to 1. So everybody bought an App in December. They spend $10 a month, but the average price for an App is $2.70?
I think we might need to consider not using “averages” here. I’d love to see what the deviation is. We might want to consider using a mean or median. Do we have 1% of the customers downloading everything that’s not nailed down and the other 99% downloading very little?
Peter- you sound like a smart dude. Let me run this by you:
First, the $10 figure is meta-data- all months averaged for all consumers of all app store products.
Second, the average price quoted in the piece was only for what was in the “Top 50 Paid Apps” section of the itunes app store (it was quoted as $2.59, not $2.70).
Why would you draw a correlation between two disparate phenomena? Also- what does deviation do for you in this story? All they are trying to do is show how kick-butt and popular the technology is. What’s the big deal?
3.7 apps rounded up to 4
$2.56 per app rounded up to $2.6
comes to a grand total of
$10.4 rounded down to $10
The problem here is that the math continues on with all four of the apps being paid, and not just the one.
The proper math would be:
125 Million in Revenue Each Moth with
37.5 Million to Apple (30%)
87.5 Million to Developers (70%)
$1,500,000,000 Each Year on iPhone Apps
I think you’re in the right ballpark.
Thanks for not helping.
Good math but remember your pick December as your base month, not a good prediction of your full year. All those iTunes gift cards in stockings might be tilting the table.
Your point may be absolutely right, but I would like to see the forest here rather than trees.
With due respect, by the time your calcs get done, the #s change. So the larger point is apple makes apprx $150 revenue/month ($500M x 30%). Take costs out and lets say they make (profits( of $100M/month = $1.2B/year + growth. Very decent #s – almost needle moving in the grand scale of things + incredible platform stickiness (both for users + devs). Thats the point.
BAM! You’ve got it, dude. (except for your agreeing with VJ- he was way screwy in his… quote)
Vijay:
Calm down, big boy. Yes- you are missing something- alot of somethings, actually. Your assumptions are all wrong, so you are making gobs of mistakes in your calculation. Who gives a crap, anyway, though??? And why did you start off by apologizing? That was as weird as my fascination with wanting to reply to you, I guess.
Anyway… I’ll point out the err in your calculation after I point out the first obvious mistake on your part- to use these facts/figures for anything other than what they were meant for: To demonstrate that smartphones are a prolific technology… and maybe that people at Apple think they are really smart marketers.
Listen, Vij- I’m worried about you over here. Take a rest on trying to figure out Apple’s revenue or total download figures or whatever. You sound like some kind of freaked-out conspiracy theorist trying to uncover the next great insider trading scam. You have poor Frioga flippin’ out over her calculator, too! (Sorry, Frioga- I had to say something)
Here goes…
IN DECEMBER, ONLY:
- Of all of the dipsticks who downloaded Apps (not all Apple customers who have ever downloaded an app- JUST the December dipsticks), they averaged 3.7 apps per dipstick.
- They never reported how many dipsticks there actually were in December, so stop trying to guess at it.
- Using a multiplier of 4 to reverse the “one quarter” figure makes you a dipstick, too, by the way.
- The quarter figure was meant by author to apply to the 3.7 figure. Meaning this: Every dipstick in December who downloaded 3.7 apps downloaded 2.78 free apps and .92 paid apps. Now do you see why multiplying 3.7 by 4 is really stupid and irrelevant? Hope so…
- The 56M figure is a TOTAL CUSTOMERS of the appstore since the biginning of appstore time. Again- they never reported quantity of December-only customers. This is your largest calculation mistake: combining facts/figures that aren’t related to each other. You are making me feel like a complete NERD in having to explain this to you… and now I’m starting to feel idiotic for even entertaining your question. (DAMN my obsessive-compulsive need to correct idiots) :-(
- The billions of downloads figure (though never reported in this piece, but since you referenced it, and it feels fun to explain… I will). This number you read about in the National Inquirer refers to the number of TOTAL APP DOWNLOADS since they started offering app downloads a year and a half ago.
- I am so PISSED that I spent all of this time replying to you. Please don’t ask any more questions so I don’t get sucked in.
p.s.- Frioga got it all wrong, too, so don’t feel bad.
Please note that we have updated both the average cost and subsequent revenue generation figures.
thanks, best, Carolyn
Stellar piece, Carolyn.
Awesome article, great image, and great research. The apple app store is definitely in huge demand right now. Its going to be interesting to watch to grow even more in the future! Also check out http://www.PhoneFreelancer if you have an app idea, its a website connecting entrepreneurs with iphone developers, for free.
How is it that each iphone/touch users spend $10 per month when users only download less than 1 paid app(a quarter of 3.7 apps) each month? If we round up that the users download 1 paid app each month and the average cost of an paid app is
$2.59, then the average amount the users spend per month should be $2.59 not $10.
Stop doing math before you hurt yourself!
The 3.7 figure is from December, only.
The $10 figure is meta-data covering all months, all users.
The numbers for revenues are all wrong. There is no way the app store is generating more than $500mn per month.
From Sept 2009 to Jan 2010, 1bn apps were downloaded according to Apple, both paid and free. That makes to be 71mn paid apps per month (1bn * 0.25 paid apps / 3.5 months). Even assuming $2.59 average price, that makes to be $180mn per month in revenues. AND $2.59 is not a reasonable average price. The $0.99 apps are likely to be downloaded much more than just a simple average of the top 50 apps will show.
Please correct me if I’m wrong. But otherwise, it is shocking irresponsible how anyone can put such numbers up.
Ian:
The 1B figure is September 2008 (not 2009) to January 2010- that’s about 16 months of downloads and revenue. That changes your analysis quite a bit, right? Glass houses, brother… You don’t happen to work for Google, do you?
It would be appropriate to assume $2.59 is the average price for ALL paid app, but $2.59 was the average price for only the “Top 50 Paid Apps” in December.
Stop getting all dramatic about “responsibility” & go back to work. You do have a job, right?
Let me clarify, on 28th Sept 2009, Apple announced 2bn apps downloaded. On 5th Jan 2010, Apple announced 3bn apps downloaded. Between this period from Sept 2009 to Jan 2010, 1bn apps were download (3-2).
This is important to me as I run an iPhone startup. Knowing such numbers is the bread-and-butter of our business.
If I was not viewing this page right now on my iPod touch I would be a little outraged!! How many american dollars do you think are leaving the states each day?!?
approval is spelled wrong
Numbers don’t compute. Hard to believe. Would someone from Gigaom speak up and explain these figures please?
Dude- if your that interested, then why don’t you get off of your butt & dig into the sources listed? Lazy!
S.I., The form “your” is possessive. I believe you meant to use the contraction, you’re. Your grammar skills could be up to your numerate skills when you’re (you are) able to differentiate between the two.
Actually Stan you’re wrong. Read again before you try being a smart-ass.
woa, pretty impressive stats!
According to this, iPhone developers are earning an average of $12,500.00 per month from App Store sales. Nice little earner – that works out to $150,000 per year.
However, I think the real numbers are skewed somewhat, as we hear of a handful earning over $1m per year, and LOTS of smaller dev shops earning a pittance (i.e. a few hundred dollars) per year.
Consider this: each “developer” registered with Apple most likely has several submitting under the same developer account. Unless you are in the top of that bell curve for earnings distribution, you are not making much at all & that is most cases.
The developer figure is interesting. I wonder though how many of them simply built something quick, threw it in the AppStore and hoped for the best.
Just like every business iPhone app development requires a long term and end-to-end strategy.
Great post though.
Well Done! you all should also check out http://www.theapplegoogle.com, they are also great!
This inability to do simple maths is just an embarrasment for GigaOM. They should take it down.
Mobile apps are a fantastic growth market but for a dose of reality (and some real numbers) read Tomi Ahonen:
http://communities-dominate.blogs.com/brands/2010/01/the-apps-stores-are-as-irrelevant-to-mobile-telecoms-as-seguay-is-to-cars.html
You know- the math errors are mostly due to the format/layout of the text of the piece. I think people are getting confused because of the layout. The data is all correct, though, so if you’re going to start faulting people for crappy math skills, start with Vijay (up top).
This is an AWESOME diagram! App users get good money from this. Go into the app business people. :D
Really bad advice- stay out of the App business, people. There are already WAY too many.
irish, your so pessimistic.
Russell, get into the app business, keep an open mind and think outside the box (app). Not everyone is making big money, but failure doesn’t hurt that much. Its a competitive market, that’s always good for the consumer.
The app market is only getting started, the iPhone is still young, and as new companies look to develop apps and mobile sites to complement their websites, developers will be in demand for a long time.
For a more dynamic / interactive view of the same dataset, AppStoreHQ lets you slice and dice all apps by price, rating and category (and shows the most-talked-about and most-tweeted-about apps): http://www.appstorehq.com/
You can do the same with the developer base: http://www.appstorehq.com/developers
Always nice to see information communicated so effectively
Yes pretty diagram and nice presentation but total nonsense content, as commented in the rest of the thread – the sums don’t add up – the conclusions on revenue at the end are complete fiction.
Apple found it worthy enough to put in to their web-site so couldn’t be that nonsensical, no? Here’s Om’s tweet:
OMG. Woke up this morning to find one of our stories from @gigaom linked on Apple.com Hot News page. Awesome. http://bit.ly/rMAgP 5:59 AM Jan 16th from Tweetie
“million” is misspelled in the first pie graph.
Wow.. makes me want to become an app developer now… too bad i’m one in a million lazy people that would much rather buy and download the apps. lol.
You think you are lazy? I don’t want to get up for lunch, so I’m eating Cheetos while surfing the net (the “puffs” kind- they are probably filled with crack, as I can’t stop eating the damn things).
I think the figures are still wrong.
The average cost of “Top 50 paid” apps is $2.59 which is
129.5 divided by 50. But there are 3 times more free app downloads than paid apps. So if we want to get the average
cost of “Both Paid & Free” apps, we need to
divide 129.5 by 200(addition of original 50 + 3 times of that) not 50 and we get $0.6475 not $0.91.
This is about 30% less figure than the original and so all the rest should be fixed by this amount making monthly total
revenue of Apple app economy approximately $175 million not $250 million.
Correct me if I’m wrong.
If you’re looking at the App Store economy from the developers’ perspective it’s also important to note the top heavy distribution of paid apps as indicated in this chart:
http://www.pinchmedia.com/blog/wp-content/uploads/2009/10/Slide4.png
Source (PinchMedia – now Flurry)
http://www.pinchmedia.com/blog/paid-applications-on-the-app-store-from-360idev/
Thank god we have people like Stupid Irishman sitting on the computer all day policing our internet sites. I dun tell ya, all dat fancy math of yers jus’ blows my mind!
Michael, It’s not “fancy math.” It’s called the ability to read, think, and apply sound reasoning. You appear to be embracing ignorance by your comment. Not a good side of any argument to be on.
Thanks for the clever analysis. Boy, you sure got me there. Next time I’ll be more careful before I say something that could be interpreted as “embracing ignorance.”
In support to the stupid Irishman, some people really have lots of time trying to prove other people wrong. If they just would read the article all through. Even at the end of the article they state, quote: “While we make every effort to ensure the accuracy of all the information contained in our posts, sometimes errors make their way onto our site, and this was one of them. We deeply regret any confusion this may have caused. Please accept our apologies.”
Not all info is there to make any assumption listed above. These are only various statements to show how well App Store is doing. If you want to know how much money Apple made in the last quarter you need more info than listed in the gigaom article.
In case I may have spelled any word wrongly, I ask for forgiveness from the spelling freaks, since math is not their strength.
And for the conspiracy theorists, I would look at 9/11 and the swine flue, for that matter, this should give you enough to dive into.
For the rest of us, enjoy the world and be happy….
Agree 100%. As soon as this article came out, I asked the smarties here to look at the forest and not the trees; I guess I was barking up the wrong tree.
Nitwit,
What makes anyone who notices and points out an error in a written forum, a spelling freak?
What makes anyone who notices and points out an error in arithmetic (nothing more nor less), unable to spell correctly?
Nothing.
It is possible to enjoy the world and be happy.
Yes.
Must that be at the expense of numeracy, literacy, and the ability to soundly reason?
No.
And here too, I agree. But when I read through this or any written forum, I find so many halfwits trying to prove others wrong. Everyone makes mistakes and at the same time everyone thinks he is the only one in the world who is right. What is ‘right’ in the eyes of an observer? Especially in this time and age when every halfwit can publish the accumulated garbage of his mind in a written forum. Read above and find that I am not too far off.
Who cares if someone writes a report even if there seem to be some differences, or how much money Apple makes, as long as the programers get their share, the IRS get their money and some funky investors get their profits. What does it concern for Tim and Henry on the exact details of Apple’s earnings with their AppStore. The store seems a good idea and it makes money… and it has nothing to do with me or Tim and Henry.
Actually, 70% goes to the SELLERS each month, which quite often are NOT the app developers, but software contractors and development houses. I’ve developed dozens of iPhone apps for clients, just as I have desktop applications. It’s the other side of the app store economy that gets overlooked. And, because a “great idea” for software can vary wildly from person to person, for many of those clients, I make more than they ever do. iPhone/iPod users are notoriously cheap when it comes to paying for apps, so the return on investment can be negligible. It’s laughable considering how much we pay for the devices and to our cell carriers like ATT monthly. A typical sentiment seems to be, “I won’t pay more than $0.99 for an app a few times a year, but I’ll pay $90USD+ to ATT every month.”
I also believe that >80% of the 28,000 developers would not be considered “developers” by professional developers who have experience and a software development background, such as myself. Rather, they’re hacks who think that “I can do it too” without understanding the first thing about software design and development. I mean, “iPhone developers” have even sold sample code that Apple provided on the App Store as their own (the Bubble Level sample, for one). Selling software that someone gave you to demonstrate something (in that case, the accelerometer) takes no skill, just arrogance.
This is why there’s so much crap on the app store that either doesn’t work, is stupid and pointless or is incorrectly written and crashes. The “app store economy” has made people think that software design and development is basically an unskilled job, which it definitely isn’t, even on the iPhone.
There are too many people who have no business being iPhone developers and wouldn’t be, except for the fact that Apple has made the barrier to entry too low. There’s a reason you don’t see 80+ fart applications and about as many bikini applications in Best Buy. Good concept development and software design and development is expensive, as is shelf space and marketing. Those are great filters for keeping crap off retail shelves.
The downside of the App Store is also the upside of it– if you have $99 for a developer account and a computer to play “software developer” on you can be an “iPhone developer.” That doesn’t mean you’re qualified to develop software any more than building a birdhouse in my basement qualifies me to build houses for those people to live in.
To become an “iPhone developer,” Apple should really require that you’ve taken at least one “intro to programming” class sometime in your life. The number of “iPhone developers” would probably be cut in half if that were the case and the quality of the average app would go up considerably. It still would leave many unqualified “developers” releasing crApps, but it would be a start.
Doh. Botched up my first line. It should have read something like:
“Actually, 70% goes to the APP SELLERS each month. Quite often, apps are not developed by the sellers, but by software contractors and development houses, for the sellers.”
Your math is flawed. It is not logical to include items which haven’t been purchased when calculating the average price paid. This is like saying the average price I paid for a car over the course of my lifetime is includes the cost of Ferraris, Volkswagens and Rolls Royces when in fact all I’ve ever purchased was used Fords. You’re also not accounting for the weighting some applications have over others. For example, 25 of the top 50 apps were $.99 while only one app was $9.99. So although the average list price is apps is $2.70 the actually average price of the top 50 selling is only $2.59. And because only one if four apps is paid we could divide the actual average purchase price of the top 50 apps, i.e. $2.59, by four to get the actual average price paid per app. So the average price paid per app is only $0.6475. Apple takes 30% of this, leaving $0.45 per app sold for the developer.
wow, google, nokia or others has no chance in front of the system created by apple, maybe with the hardware, but in this sector is important the software part also, there is a software for everything…in the appstore
Absolutely brilliant summary of key data! Please say more!
Stuart
I dispute this 30% that Apple are always credited with receiving
Of course for every dollar spent on itunes vouchers or credit Apple retain 30%, but it is never reported that only a part of that is profit.
In addition to the infrastructure and staffing cost for the app store there is some profit margin for retailers of iTunes vouchers
Apple also cover promoting the app store and then vouchers are often available as giveaways with iPods or discounted when multiples are purchased.
I purchased $250 AU for somewhere between $150 and $180 in 2007 and have done a similar thing several times since, most recently purchasing at least six pairs of $20 vouchers for $30/pair
Does Apple , the retailer or the Developer cover this heavy discounting?
I suspect it is most likely to be Apple since I have never heard a developer complain that he didn’t receive his 70% because the voucher used was purchased at a discounted price and retailers don’t like to sell things at a loss.
BTW – Cool Graphic
Thanx alzo for yor Eksellent dysplay of amerycan logyk, math, and speling skils. it explanes alot of thingz goin on in yor wunderful cuntry. an yor the wuns wit fansy compyters. an fotoshop kant fix yor problms.
Forgive me if someone else has posted this, but what is the average monthly / yearly earnings for each developer, based on these figures?
“keep on keeping on”.
Fantastic info-graphic. I keep wondering if there it might have made more sense if it was split into various sections instead on one really long image :) Otherwise, cheers to the work and concept behind it.
Gigaom.com, et al.
Thank you for this Web page and the responses. As a graphic designer responsible for making informational graphics, I found the various responses most enlightening. I must remain mindful of the sub-standard education possessed by the majority of decision-making individuals. My “Don’t confuse me with facts, my mind is made-up” poster over my desk has renewed significance.
I’m not sure that the graphic is a good one. I feel that an informational graphic should clarify and make points more understandable. Otherwise the effort only gives rise to F.U.D. (fear, uncertainty, doubt) which is counter-productive, possibly destructive.
I think a good graphic presentation of data allows the viewer to get actionable information from it. (Definition: If you don’t know what to do with it, it’s only data. Information is something you can use. Thus, you can’t have information overload, only data overload.) The discussion about the graphic(s?) leads me to conclude that nothing was clarified by the graphics. Clarification came in the ensuing discussion. Had the discussion been lacking, several would have come to erroneous conclusions from the graphic(s?) alone.
I disagree that correct grammar, spelling, logic, and arithmetical skills are mutually exclusive.
Thank you, everyone, for this eye-opener disguised as a Web page.
Thanks for the insightful analysis Stan! My “The World is Filled With Arrogant Bastards” poster over my desk has renewed significance. I would question how many of us sub-standardly educated Americans will be able to understand your fancy rhetoric and logic though. Maybe you’re wasting your time.
Thanks for that. Your reply shows that Ignorance and apathy trumps education and attention to detail. My job is to make things simpler to understand. You’re the reason I work at what I do successfully and get paid as much as I do get paid.
Michael, I didn’t mention Americans. Do you think that all decision making individuals are only American? How arrogant! Speaking of arrogance, how did you come to that startling conclusion? Since you brought the issue up, one of the reasons the United States of America must import intellectual assets is that there is a shortage of suitable home-grown talent. You might find what you’re after with some humility, yourself.
Your response?
The second sentence in your latest response shows that ignorance comes before attention to detail, at least in your mind. Check your subject-verb agreement; oh, and ignorance shouldn’t be capitalized. Also, using the phrase, “get paid” twice in the same sentence is clumsy word usage. As a professor of chemistry, I realize that attention to detail is important, but too much attention to detail and not enough attention to the overall “picture” can become a form of ignorance, in and of itself. You’re doing just the thing I am parodying at the opening of this response. You are picking through responses and finding some detail, small error, or mistyped word. Then you correct the trivial mistake in some half-baked response in which you preach about your own superiority and high-paying job.
“Too much attention to detail … can become a form of ignorance, in and of itself.” A professor of chemistry. Neat. Which branch within that large discipline? Do you publish? Who proofreads your work? Who illustrates your findings? How credible do you think you and/or your information sources would be with errors in basic arithmetic, spelling, grammar, or logic? You’re bashing the person trained and hired to make folks like you look good in books, journals, and periodicals. I find that astonishing, quite frankly. As a teacher, you must have some opinions about the direction of your flock. Everything going OK, in your observations? All “800″ SAT scores?
I’m telling you, and any others that may have tuned in, that I have undeserved job security solely due to things that should be built-in for those able to find a place to express themselves. Tell me you disagree with that. (Don’t, please.) [Not so] “Stupid Irishman” got my attention and others (you included) pulled me out of lurk mode. I would regret the time lost; but, it became a forum for me to rant about the Ignorance and apathy i witness.
We might have different takes on the meaning of parody. I thought it more sardonic. Humour is difficult enough to handle by professionals.
Michael,
FWIW, I checked with a neighbor of mine who agrees with you that I come across as being arrogant. BTW, I’m not turning my back on you, the “Reply” doesn’t seem to have worked in my last couple of posts. The thread may be winding down. Before I forget, have a healthy (most of all) and happy new year despite the rancor between us, here.
Thanks. I enjoyed our discussion on this forum and I wish you a healthy, happy New Year as well. Just out of curiosity, what country are you from?
Born: Portland, Maine.
Moved: Montreal, Quebec (not that far away-many yanks here, also-very different view of the world)
Dual Citizen: 1991
Michael, the pleasure was mine.
If you don’t know how to produce an app to become richer, just buy APPLE STOCK. The end result will be similar.
A very fair and balanced article and useful stats
See 18 javari Apps for iPhone and iPod touch on iTunes
20,000 downloads in 75+ countries
http://itunes.com/apps/javaricom
Cybereditor
javari.com
New York NY
The comments on this story get more and more bitchy and irrelevant by the day. It might be a good time to close them.
Having said that, it bugs me when businesses use comments on other people’s articles for self-promotion. It has a faint scent of “sleaze” about it. Well.. maybe not so faint.
Okay, there’s MY bitch-moan. “Next!”
Great Information :)
They should put that on toilet paper: App store facts. Each little bit has 1 fact on it.
I don’t get your calculation at the bottom of your post, Om. It seems that you are assuming that all apps have equal sales, while in reality cheaper apps tend to have higher sales than more expensive apps, which would put the average price paid per sale lower than the average price asked per app.
Going by your math, I could post 1000 apps for $999 each, and in spite of nobody ever actually buying them, your “average price paid” would go up to $3.
($3.63 x .99 + $1000 x .01) x 0.24 = $3.26
More generally, I believe that these kinds of statistics would be much better if we stopped listening to the ad firms who have never sold an app themselves and actually started polling developers.
If a dozen developers from all over the App Store pooled their data, some with high sales, some with low sales, some with games, some with business apps, some hit-driven, some slow burners… they could assemble very reliable stats. I wonder why nobody is doing that. Is it prohibited under the Apple NDA?
Yeah, I agree. That does seem to suggest that all paid apps are bought equally regardless of price, which certainly isn’t the case. (average price listed <> average price paid) However, I doubt there are a lot of apps tilting the scales like your example. The effect of the higher priced apps is probably negligible given the number of apps on the store and their tendency to be at the bottom end of the price scale.
Discussing sales data is not prohibited by Apple, but you’d need a lot more than a dozen developers to get accurate numbers, and again you’d need to speak to the people publishing the apps, which are not necessarily the developers of the apps.
Speaking for myself, when we develop iPhone apps for clients, the financial statements go through their accounts afterwards; we don’t ever see how many sales they actually get or what that comes out to revenue-wise. Even if we did, we wouldn’t share the info; it would need to come from the publishers themselves. I don’t believe that lower selling app publishers wouldn’t be very interested in sharing their numbers, and some companies wouldn’t release numbers either way (just as Apple doesn’t with their software) for competitive reasons.
Of course, Apple knows these figures exactly, and they’d be the best source for accurate data, but they’re not sharing.
Nice graphic!
Problem is 80% of the apps in the app store are “Shovelware”, “Trash”, worthless junk. The good stuff is buried by scammers who have 2000 apps in the store, each of which is a useless SINGLE FEATURE that can already be done by the iPhone/iPod. Apple needs to remove all this TRASH that clogs the system up, perhaps they can do this by having developers PAY a few hundred bucks for EACH APP they submit.
Excellent idea. So good, in fact, this is how most mobile software worked before the iPhone! Hobbyists couldn’t penetrate those markets, so only the big companies wrote software for them.
Incredible figures!! What would it be in 2015?? Thanks Gigaom!!
Others are right: the numbers are wrong. Here’s the problem with the math: $3.63 is not likely to be the average price paid for a downloaded app, so $3.63 x .24 isn’t a correct calculation.
It’s very likely that most of the downloads are for the lower-priced apps (eg, $0.99), so the 25% are not likely to have an average price of $3.63. If we use the average of the top 50 as a place to start, their price averages $2.59.
But that’s not the average price of a downloaded app, since the most-downloaded apps,with a few exceptions, tend to be the lowest price ones. (The #1 paid app gets more downloads than the #50, so we would need to weight the average price by download volume to get a better number, and even then it would only apply to the top 50, not all of the other apps.) Instead, think of $2.59 as the maximum realistic price per paid app.
So the maximum realistic price per app, including free, is $0.65 (rounded), and the actual number is something less than that. This means that the revenue numbers ($250M in December) are too high also.
this is important to me as I run an iPhone startup. Knowing such numbers is the bread-and-butter of our business.
wowza…i wonder how my app will fare in 2010…its a truly productive one too
I’d be interested in some details about the methodology used to get the information about the number of paid app of the total number of download. 25% seems to be huge number, I’ve seen other estimates (including my gut feeling) that this ratio is way under 10%.
Anybody knows why this information is not officially available from Apple – suspicious. If it is 25% really, I am sure they would use it in marketing. Seen a report that with all operational expenses Apple have they just break even with what they charge from those 30% revenue split from paid apps.
it is so cool
wow this is great
Why did they go to the trouble to change it those of us who suggested the update are all idiots, failing the whole word problem thing back in school, and OMG this and Cheeto that? STFU.
@chacha
Please, don’t take this personally; but, you’re a shockingly incoherent, ignorant individual. Instead of trying to edit your post to make any sense at all, why not keep your tiny brain better occupied with some homework? You sure could use remedial grammar. Does your mother know you are using a computer unsupervised?
We need an app which will port an iPhone app to Android. Because Nexus One and other Android phones are going to take away the market share from Apple. Remember – I said it here first!! – Arunabh Das
I’m thinking Apple needs to open up the iphone SDK to make it possible to cross compile to iphone from other platforms.
Good post and excellent idea. So good, in fact, this is how most mobile software worked before the iPhone! Hobbyists couldn’t penetrate those markets, so only the big companies wrote software for them.
Thanks Marc…..
Great idea. So good, in fact, this is how most mobile software worked before the iPhone! Hobbyists couldn’t penetrate those markets, so only the big companies wrote software for them.
Thanks Daniel..
I’d be interested in some details about the methodology used to get the information about the number of paid app of the total number of download. 25% seems to be huge number, I’ve seen other estimates (including my gut feeling) that this ratio is way under 10%.
Anybody knows why this information is not officially available from Apple – suspicious. If it is 25% really, I am sure they would use it in marketing. Seen a report that with all operational expenses Apple have they just break even with what they charge from those 30% revenue split from paid apps.
It seams to me that is way more profitable to be iPhone developer than web developer these days.