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 …
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.
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!
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.
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.
"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.
I think you'll find they're interchangeable:
http://en.wikipedia.org/wiki/Craic
It takes a pedant to call out a pedant...
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.
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.
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.
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.
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.)
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?
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.
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.
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.
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.
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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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.
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 ...
@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.
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.
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.
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.
> 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'.
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).
> 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.
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
And another sale.....of the free version but watch those iAd thousandths of a cent come trickling in. Game description needs a bit of work - maybe I'm thick (no maybe about that) but I couldn't work out what the game was from the text. It doesn't think m1nge is a word, but addictive!
Forgive me @appsdelight.com for what I am about to do:-
"It's a highly over-saturated market but like every industry the good ones will survive will [sic] the others will move on."
Definition of "the good ones" = "the ones that survive"
Search and replace in above sentence + sprinkle syntactic sugar:
"It's a highly over-saturated market but like every industry the ones that survive will survive [and] the others will move on."
Contract + sprinkle more syntactic / logical sugar:
"It's a highly over-saturated market but like every industry some will survive and others will move on."
And again, (selectively picking one of the last two assertions for emphasis):
"It's a highly over-saturated market; there will be deaths."
I couldn't agree more!
Mine's the coat that's mine.
"To get ahead, Canalys says small developers – and makers of non-game apps in particular – should explore as many marketing avenues as they can come up with..."
Good Lord, if only I'd known!
And then, of course, they list all of these things that small / indie devs are likely to find nearly impossible: Partnerships, product tie-ins... Oh, yeah, I'll just go have Walmart make plush 'Link Thing' node dots to tie in to my PlayBook game with 2000 downloads. That'll go over big.
Sigh.
An App I have found fantastic and worth every penny is called Pleco which is free as a basic app. It's for learning Mandarin Chinese. For the dictionaries and addons you can pay a fair bit. I've paid £50 for all the dictionaries, OCR, flashcards, audio etc as it's very useful but also very niche.
Chinese is one of those languages where if you don't know a character it is incredibly difficult for a westerner like myself to understand it's meaning. Now I have OCR on my phone and it's success rate is fantastic.
This is the most I've ever spent on an App in my life, the next App down would probably be less than a £1 for Tunein Radio Pro or the Bus Checker App.
" I've paid £50 for all the dictionaries, OCR, flashcards, audio etc as it's very useful but also very niche."
I think you've made a very important point here, pompurin.
Apple's App Store, Google Play and whatnot are nothing but distribution channels for software. Many developers seem to think that they're entitled to earning a fortune, just because they can (in theory) benefit from a large user base very easily. But so can other developers. Naturally competition is tough. (and average selling prices very low)
On top of that, if the product doesn't stand out, be it because of it's particularly high value for a niche market (like pompurin's example), or be it because it is very unique and useful (or entertaining) otherwise, there's little difference to "traditional" software development: Nobody buys a product which is average. And let's be honest: Most software out there is very average (or worse).
The bigger players obviously achieve the biggest revenue from those channels. However, they also put a lot of money in. I'm not too sure that the mobile software sales as such made them any richer. But it's a good way for them to make their brands even more popular.
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