Blog Post

Apple Boasts 2 Billion Reasons for Devs to Stay With IOS

Amid all the fanfare over new iPad 2 hardware, Apple’s (s aapl) CEO Steve Jobs boasted that the company has now paid out a cumulative $2 billion to developers for apps sold in the App Store. This comes just eight months after it announced developers had made $1 billion from the app store since the store launched in July 2008.

This is a huge number and highlights one of the reasons Apple is doing so well in this post-PC era. It’s not only building devices that embody the intersection of technology and humanities, as Jobs likes to say; it’s also creating an environment for developers to take advantage of these more personal and powerful machines. This vibrant community of programmers has helped push Apple’s count of apps up to more than 350,000.

The Asymco blog recently (and accurately) estimated that Apple had paid out $2 billion to developers over the course of 31 months, compared to the 34 months it took for record labels to make that much money on iTunes. This suggests Apple’s App Store is on a huge growth trajectory and shows why developers are still so loyal to the iOS platform. Even with some restrictions with the App Store, they have a better shot at making money there.

But the $2 billion isn’t just coming from paid downloads. Apple developers are also raking in money from in-app purchases, which have become a major revenue source for devs in the last year. According to Distimo, an app analytics company, revenue from in-app purchases both in free and paid iPhone apps was 49 percent last year, compared to 51 percent of paid download revenue. And that’s not counting any money that developers are getting on their own through advertising efforts.

The point is, Apple’s App Store is still the top destination for developers because it has robust revenue-generating options ensuring it won’t be shoved aside anytime soon. Android’s (s goog) ascendance will certainly draw developers, but until it becomes easier to make money there, it’s not going to be the priority for most developers. Google, for its part, is improving the money-making potential of Android with an announced in-app purchase system and a new web store front. It’s also looking at expanding carrier billion options and trying to improve app discovery. But for now, Apple has 2 billion reasons why developers should stick with iOS, and that’s a lot more than Google can say. And as more users buy iOS apps, it further locks them in and makes it harder for them to switch platforms.

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4 Responses to “Apple Boasts 2 Billion Reasons for Devs to Stay With IOS”

  1. Daniel mckenzie

    Hi people,

    I want To talk about the app store, dose any One live in australia? Well here in au we pay $1.19 for the American $.99 apps.. But has any one noticed that a au dollar is worth more then the American dollar? Yer it’s only 20 cents but it’s still not right I have a iphone4 and to me this is bs. It is discrimination at it’s finest just cause we live on a island they think we won’t notice it? I mean WTF is going on. I can say that I have spent easily $1000 dollars on the app store since last year. That means I have spent $200 more the I should of!!!! This is wrong this is just as bad as a con! Some one should sort this out.. Cause in the end after all ur apps and all ur music we have all spent more then $1000 it’s wrong! I would rather go with windows if I’m going to get ripped off… Wake up apple were not dumb and were not going to take it

  2. While $2Billion looks like serious money to folks like us, it’s both a pittance to Apple financially, and translates to $5,714 per app. Sure not all 350,000 apps were on the store all that time, but it does indicate just what developers are up against. So, the title really should be $5,714 reasons to stay with iOS.

    • How many of the 350,000 are free? Yes it is pittance to apple because apple develops the products and the infrastructure that even allows devs an opportunity to reach an audience. Devs can also thank Apple for pushing the app market which led to Android, RIM, and Windows to push their markets as well. The industry has treated talented developers well.

  3. The number of apps is important but what I find the most interesting is the lead Apple is building in vertical markets. There gets to be a point where others just can’t catch up or compete.