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back to article Half of all app store revenue goes to just 25 developers

Apple's App Store and the Google Play store each claim to offer over 700,000 apps to choose from, but only a tiny fraction of them bring in significant revenue for their developers, according to research from analyst firm Canalys. In fact, the company says, of the $120m in total revenue generated from paid app downloads and in- …

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Meh

This isn't new, this is old news.

There are very few App millionaires, all that effort in coding an app for little reward.

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Anonymous Coward

Very few apps are essential or really useful. There's a vast number of really useless paid for apps or apps that would be useful if the programmers could code or design software properly.

When was the last time someone asked you about apps, where's the market research?

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vast number of really useless

There are also a vast number of "Free" games that let you play for a bit then you hit a wall and can't get to the next level without buying coins or other crap. I ran accross one guy calling them "pay to win" games and that seems like a good name. Facebook is the same with games.

I would much rather have a free version that lets you try it, then pay some fixed amount if I like it for the full game. I'm not going to touch any program that wants you to buy stuff in game.

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Re: vast number of really useless

Pay-to-win is the standard model for internet games, and usually also for apps..

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Re: vast number of really useless

Like many apps period. 'freeware' driver update tools / system cleans / virus scanners. All use awful methods to try and get you to buy the subscription.

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> few App millionaires, all that effort in coding an app for little reward.

So you are saying that it's not worth your effort to get out of bed unless you can make a million before your mother brings you your dinner.

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Little reward

"So you are saying that it's not worth your effort to get out of bed unless you can make a million before your mother brings you your dinner."

Exactly. And what about the countless hobbyists who do it for the crack, or even those happy to make £5k for a few weeks' work in building an app or game? These stats are quite pointless in that the vast majority of mobile app coders go into it knowing full well they aren't going to make millions.

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Anonymous Coward

Well since only 5-10% of developers even make back their development costs it really isn't worth getting out of bed for most of them. They would have been better off not even trying. And so would we as there would be a few hundred thousand fewer crappy apps out there.

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It is just like every other platform. There are far more Joe Bloggs developers than there are Microsofts and Adobes, but the big bucks go to the big boys.

It also seems that once you come out with a decent (popular?) app like instagram or draw something then the big boys come and buy you out anyway.

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Anonymous Coward

Re: Little reward

"...what about the countless hobbyists who do it for the crack..."

I think you mean "... for the craic..." —unless there are people out there coding in return for class A drugs.

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Meh

As a hobby no problem, but if you go into this and spend months developing an app that has no return when that is why you developed it in the first place, what is the point.

To be in business is to make profit. Work for 1000 hours and get a return at a rate of £1.50 per hour worked is wasteful. You can't live on that.

If you are a developer, add up the time you spend, then your overheads and the cut taken by the store and divide that by the money you make. If you are not making a minimum 30% more than what it cost you give it up.

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WTF?

Re: vast number of really useless

I'm not going to touch any program that wants you to buy stuff in game.

How is "pay to win" any different to stuffing arcade machines full of coins? Tablet and phone games afford us days of fun for the money we would have spent in a couple of hours at a games arcade. Lucky us!

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Re: vast number of really useless

And for life. See Eton, media internships etc.

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re: How is "pay to win" any different to stuffing arcade machines full of coins?

Stuffing arcade machines full of coins is "pay to play" not "pay to win". "pay to win" implies you can play for free, but pay for buffs that make it easier to win. The two things are similar but clearly different.

It seems a lot of people commenting here are confusing the two.

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Boffin

Re: re: How is "pay to win" any different to stuffing arcade machines full of coins?

I'm not seeing a particular distinction other than in the sophistication of the mechanism. Effectively it's the same thing: the chances of you being able to beat most arcade games on a single 1UP is basically nill. Your 1UPs are as extensive as your wallet. This really is just an extension of the arcade model - sure, in theory you could win without paying but in practice it isn't going to happen.

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Anonymous Coward

Re: re: How is "pay to win" any different to stuffing arcade machines full of coins?

Exactly, which is why the majority of arcade players were either losers or very casual players ... and the same can be said of their idiotic cousins on FB etc

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Stop

Re: re: How is "pay to win" any different to stuffing arcade machines full of coins?

cyborg - speak for yourself, I was quite good at arcade games and could beat it on 1 set of lives! :p

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@madra Re: Little reward

I think you'll find they're interchangeable:

http://en.wikipedia.org/wiki/Craic

It takes a pedant to call out a pedant...

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Which is a good thing, no?

Sounds like business as usual, then.

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Anonymous Coward

Unless of course the skill they've acquired in delivering these unsuccessful apps allows them to deliver successful apps at a later date. Being rubbish vs. being good at something is not fixed over time.

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all that effort in coding an app....

like getting hold of all them fart samples

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Joke

Being rubbish vs. being good at something is not fixed over time.

try telling that to...

redmond,

1 infinite loop

chocolate mountain

<insert name of fave tech bogeyman here>

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Crack - craic

Both correct, but 'crack' is more so. People have been using the word in that context for a lot longer in the North of England than they have in Ireland, and longer in Northern Ireland than elsewhere there - 'craic' is just a fakey back translation for people who think it's only an Irish idiom.

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Re: Being rubbish vs. being good at something is not fixed over time.

Is it pointless to make an app that makes no money? Well, if that provides experience of app building and deployment to put on a CV, at a time when most major companies are looking to have apps in the marketplace, then i'd say there are very few that are pointless.

Experience counts.

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I agree it's old news, though in a way, I wouldn't want too many millionaires either - the idea that people could make loads of money from just writing any old rubbish doesn't seem right either.

What is sad though is the way that this myth has been spun about how you can make so much money on mobile (especially this myth is spread for iphone), which has caused a bandwagon effect, which still remains even though it ought to be clear that any "gold rush" stage has been past. There's also this myth about how it's possible for people to make it rich with little effort or zero marketing, when in practice, the winners are those that have had lots of marketing. This myth that the Internet makes things an equal stage, when in practice we see many of the same traditional problems to publishing and marketing still apply.

People are drawn in by the stories of people who made millions, but you don't hear the stories of everyone else. Statistics of average sales will typically use the mean, which will be skewed if most money is made by a few - we really need to look at the median. So even though this is old news for us, it's still good to hear it, as many aren't aware of it.

(There's a similar effect with e-books - I've heard people say how e-book writing is the new gold rush, but if everyone's talking about 50SOG, I think it's clear that it isn't any more. And when one book sells well because it's talked about it all the mainstream media, whilst most other books are ignored, I don't see how that's different to how things were before the Internet, if anything, things seem even more distorted.)

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Anonymous Coward

What was it worth?

The product that started this app craze was the iPhone. It's technology is debatable. Even in 2007 the Nokia N95 had more features than the iPhone. The iPhone only had a touch screen. The latest model does not have lossless zoom, no NFC, a reliable map app has to be bought separately and its "retina display" is now outmoded as other phones that have a higher screen resolution.

Very few of the apps in the app store are essential or really useful, most of the apps are around established social network services or just replicas of web pages. In fact, mobile web pages make a comeback as they are easier to develop, and work accross several mobile platforms and versions of OSes.

The profit margins on mobile apps are small, so far to those who dropped out of university or high school to program on apps. Economies of scales work here, only the bigger developers or publishers stay big.

What then was the iPhone? An exercise in how marketing hype works? A proof how easy it is to seduce consumers to part their hard earned cash?

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Re: What was it worth?

In fact it wasn't even the iphone - because the original iphone couldn't run applications! That didn't come until the "3G" in 2008 (by which time, even more manufacturers, including Nokia with Symbian, had started producing touchscreen smartphones than before).

I'm not sure what caused the craze - in particular, this craze that every company needs to have an "app" for their service or site, as opposed to more conventional uses of software. It's not clear it was having their own software distribution site - because even though every platform now has had that for years, iphone still gets catered for above all else.

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Anonymous Coward

99%

Well as is usual, the internet is like life, only much, much worse. In spite of the incessant propagandizing of trash like Chris Anderson, with a handful of exceptions, everyone is in the long tail. And they nearly all starve there. As has been mooted lately, "Maybe the internet only wants one of everything". So maybe this is actually a bit better than what we usually get from the internet: two apps stores providing income for 25 app companies.

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Holmes

Surprise, surprise

Game Developers conquer a slightly different form of console/computer using their sizeable development and marketing teams. Often using their existing products to tie in no doubt.

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Re: Surprise, surprise

Quite. The "new entertainment" (games, music - though that's a different market) funds the platform. For me the most useful software that doesn't come with the OS is probably Citrix receiver (which presumably makes it's cash in other ways).

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Boffin

Re: Surprise, surprise

And also unsurprisingly, almost all the games available, including those from the big companies, are shit.

The good games are those made by one or two people just to earn a bit of beer money. Thus it has always been.

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Anonymous Coward

You have to start somewhere

In my case my not-so-much profit app helped me score a nicely paid job at one of those 25 companies.

Also beats making websites, I mean Web 2.0 services. Now there's something where success is harder than winning the lottery and failures are worth almost nothing for your future.

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Aye, the <insert number> of apps we have...

And how many different apps is that?

700,000 unique and different apps, or 7000 apps with 100 different skins? Or even 100 apps and 7000 skins?.

Even on the Windows Phone marketplace (yeah, okay...) which has considerably fewer (look it up for yourselves...) most apps are duplicated.

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Silly all or nothing attitude

I know several indie game developers who have full time jobs and solely do the game work on the side. Some of them give away the games and have a PayPal tip jar or other mechanism for donations. Others go for very low prices, typically 99 cent impulse buys. All of them have been pleasantly surprised by the amount of money that has come in.

They aren't getting rich or quitting their jobs to take up making games full time. But having a hobby that pays the mortgage is pretty sweet.

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Go

Re: Silly all or nothing attitude

Yep, I'm producing serious software and games in my spare time. Can't say I'm paying the mortgage from it yet, but that's what I have tenants for.

The hardest problem for most indie developers is getting noticed. Having just launched my first iOS game a month ago, I am learning fast what to do and what not to do with regards to press releases and getting journalists to even read to the end of my mails.

Sadly, I'm coming to the conclusion that the only way to get noticed when you're not working for EA or Zynga is to buy reviews. Which all the big companies obviously do either directly or indirectly through the purchasing of advertising space.

So why do I continue? I enjoy programming. I'll also be damned if I'm going to work for someone else for the rest of my life. Even if it takes another 10 years, I'll get there.

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Happy

Re: Silly all or nothing attitude

Your subliminal advertising worked, I downloaded the game ( free version obviously) and quite liked it, enough to upgrade? Give me a little time to play it and ill let you know!

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Re: Silly all or nothing attitude

Whether you upgrade or not, it's always good to hear someone else is enjoying it. :)

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FAIL

Fake nonsense statistics based on flawed samples

If any of this was ever true there wouldn't be so many freelance developers, startups and small software houses developing and releasing apps and games on iOS in the first place.

If only a few big software houses were getting all the profits on IOS platform no one would even be trying. Surely not freelance developers that usually start with just a few thousands bucks to buy the bare minimum hardware, software and books as needed to develop any good app.

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Re: Fake nonsense statistics based on flawed samples

If any of this was ever true there wouldn't be so many freelance developers, startups and small software houses developing and releasing apps and games on iOS in the first place.

Er, no. People will do anything for money based on perception. That's why pyramid schemes (and MLM) work so well; people think they'll get huge rewards for their investment. The reality, however, is usually something quite different ...

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Re: Fake nonsense statistics based on flawed samples

@magnetik

"Er, no. People will do anything for money based on perception. That's why pyramid schemes (and MLM) work so well; people think they'll get huge rewards for their investment. The reality, however, is usually something quite different ..."

You have no clue what you are talking about. The Apple Store is not a scam pyramid scheme. It's a true business. Developers are on iOS because customers pay for apps.

These fake statistics are clearly wanted by Google and/or Microsoft trying to attack Apple as usual.

Their scare tactic is just plain lame. Their platforms are scam ones indeed, on Android customers just don't want to buy even $0.50 apps. There is no profit there.

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Boffin

Re: Fake nonsense statistics based on flawed samples

50% of revenue going to 25 developers is not "flawed samples". You can't accidentally get a result like that through a few rounding errors. Rather, it's clearly indicative of a power-law distribution, and as such is completely expected in a system where there is no hard maximum value for revenue.

As for the idea that if there wasn't a chance of success, people wouldn't try ... see "The National Lottery". (There's an extreme power law - consider the proportion of payouts which go to ~52 people each year.)

But there is a very silver lining here. The key fact is, the *other* 50% is going to the other developers. Big software houses are not getting all the profits. The big software houses are getting half the profits and leaving half on the table for smaller fry. Half the profits not going to the big boys is very good news indeed. Compare this with the movie industry, the traditional computer game industry, or the recorded music industry.

It's still not brilliant news for everyone though. If it is a power law distribution, then the next 25% goes to the next 25 developers, the next 12.5% to the next 25 developers, and so on - so 94% goes to the top 100 developers. Still, even the remaining 6% of the App Store pie is a ton of money. You can in theory figure out exactly where you need to be in the pecking order to get $X revenue per month. And it's high, but not that high, which is why we do see many individuals being financially self-supporting via App Store. But the number of people who have failed to even make $50 back must be 10 or 20 times higher than this.

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Re: Fake nonsense statistics based on flawed samples

Would this be the same iphone developers that claim the main reason for choosing a platform is going for the largest installbase (see a recent Register article), when iphone has never been the largest mobile platform?

Yes, if they can't even look up something basic like sales, I'm not sure I'd trust them on something less easy to measure.

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Re: Fake nonsense statistics based on flawed samples

It's not "flawed samples" it's FAKE SAMPLES.

It's fake statistics.

Who wants to drive away the freelance developers force from iOS to other platforms?

1) Microsoft. (desperate with their silly restricted Windows 8 developers program)

2) Google. (desperate with fake statistics to the press because they sell only very cheap phones and developers are quitting the platform due to customers not paying for apps at all)

If these fake statistics were true there wouldn't be around 15,000 freelance developers and tiny startups and small (2-5 people) software houses producing apps and games on iOS.

If everyone was getting only a tiny bit of money and just 25 big mutlinationals were getting all the profits there would be no one left developing for iOS.

If people buying iOS devices weren't buying apps and games there wouldn't be any profits.

Nowadays the average iOS user has no less than 100 apps installed at a time on any Apple device. At least 50 or more they buy.

Then a minority of iOS customers doesn't buy apps and another minority uses pirated copies (that lack updates..at each app update they must find a new cracked version and reinstall it.. how smart they are.. just like on Android..pathetic people stealing ultra-cheap apps).

85-90% of iOS users generate profits on the platform by buying apps and games. And surely not just 50 to 75 apps a year released by 25 big software houses on the platform.

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Re: Fake nonsense statistics based on flawed samples

> developers that claim the main reason for choosing a platform is going for the largest installbase (see a recent Register article),

Once again you perpetrate a myth that you created by your misreading the article. If you read the actual article the developers claim that they choose '_a_ large userbase'. No one said "the largest installbase" which is simply your own 'fake nonsense based on flawed reading'.

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Re: Fake nonsense statistics based on flawed samples

That's an interesting interpretation - perhaps it explains why people answered that way. Though it makes the information useless (how large is large? And okay, so I select the ones with large userbases - if that leaves me with 2 or more, and I pick one that's not the largest, it seems odd to say it's the most important criterion, rather than one of several criteria).

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Re: Fake nonsense statistics based on flawed samples

> That's an interesting interpretation

It's not an 'interpretation', it is the plain meaning of the words that were used in the article (as distinct from what you wrongly thought the words were).

> and I pick one that's not the largest, it seems odd to say it's the most important criterion, rather than one of several criteria).

It is, according to the developers that responded to the article, 'the most important', they didn't say it was the _only_ criteria, which is what you also seem to (wrongly) think was said.

You seem confused that some developers write for iStuff, some for Android, some even for WP or BB. That just doesn't fit into your mindset.

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Anonymous Coward

Very much reminds me of that film of the Philip K book...

... The Running Man.

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Headmaster

Re: Very much reminds me of that film of the Philip K book...

I think you'll find it was a Stephen King book (writing as Richard Bachman)

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Happy

LazyBrush

Spent a year writing Lexigon for iOS and Android. Made about £500 on iOS and £5 on Android.

Getting lost in the sea of apps is indeed a pain. Without any money for marketing you end up posting on related articles on the register in the vain hope someone will download your app.

Lazybrush

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Re: LazyBrush

Can I have a "P" please Bob?

Nice game.

Not as good as Cohesion for Android though.

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