EU developers took in $23.9 billion (€17.5 billion) in revenue in 2013, and Gigaom Research forecasts that figure will increase to$86 billion (€63 billion) in five years. But you might be surprised where a lot of that revenue comes from. EU developers collected more than half that total — $15.7 billion (€11.5 billion) in 2013 — from contract labor.
Many of the current market dynamics of the app economy have the air of a gold rush. A relatively small number of opportunistic companies have learned how to make the economics work and dominate app store revenues, mostly with games. At the risk of exhausting the metaphor, the surest bet in a gold rush is selling shovels: In this case, that means contract labor.
As part of the Eurapp project for the European Commission, Gigaom Research surveyed both independent and in-house developers as inputs into an industry model of revenues and jobs. Our analysis indicates that EU developers earned $8 billion (€5.9 billion) from apps sales and advertising in 2013. EU developers account for about 40 percent of global app revenue, and EU consumer spending accounts for 30 percent of the global total.
The proliferation of apps beyond gaming, specifically into roles as marketing vehicles or as the means to deliver services like consumer banking and sales force automation, will drive the demand for contract labor. We project that EU developers will take in $62.8 billion (€46 billion) in contract development work in 2018, up from $15.7 billion (€11.5 billion) in 2013.
Those revenues support a healthy job environment. The EU app developer workforce will grow from 1 million in 2013 to 2.8 million in 2018. Additional support and marketing staff result in total app economy jobs of 1.8 million in 2013, growing to 4.8 million in 2018.