Full Analysis of iPhone Economics: Bad News?
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Full Analysis of iPhone Economics: Bad News?
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Re: Full Analysis of iPhone Economics: Bad News?
#2The profit potential on the desktop and the pure web has always outstripped what iPhone apps are capable of. If it's a labor of love or if you just love Apple, by all means, develop for the iPhone. If profits are your goal, the iPhone is a severely limiting choice, for freelancers especially.
Re: Full Analysis of iPhone Economics: Bad News?
#3His entire analysis is basically taking the revenue total for all apps, divided by the number of apps, and saying each developer only makes an average of $3k per year. Sorry, this is not a good analysis. Some people give their apps away for free. Some quality apps make millions. This doesn't mean the opportunities are not there.
A similar analysis could be done of PC shareware software authors, with similar results.
Re: Full Analysis of iPhone Economics: Bad News?
#4His entire analysis is basically taking the revenue total for all apps, divided by the number of apps, and saying each developer only makes an average of $3k per year. Sorry, this is not a good analysis. Some people give their apps away for free. Some quality apps make millions. This doesn't mean the opportunities are not there. A similar analysis could be done of PC shareware software authors, with similar results.
He has data that indicates 73% of total apps on the store are paid. He then bases his remaining calculations on that paid app number.
Re: Full Analysis of iPhone Economics: Bad News?
#5I'm not sure I buy that a typical iPhone app costs $35,000 to develop. Considering the simplicity of most apps, combined with the fact that many apps are effectively the same program with some content alteration, it seems like a really inflated figure.
Re: Full Analysis of iPhone Economics: Bad News?
#6His entire analysis is basically taking the revenue total for all apps, divided by the number of apps, and saying each developer only makes an average of $3k per year. Sorry, this is not a good analysis. Some people give their apps away for free. Some quality apps make millions. This doesn't mean the opportunities are not there. A similar analysis could be done of PC shareware software authors, with similar results.
Nope, that's not what it is. He explicitly states that he excludes the free apps in the revenue analysis. He uses a combination of numbers from Apple and from other 3rd party services to come to the median revenue per paid app at something like $680/year.
He also fully acknowledges that there are some extreme examples that make it big, but that half of all paid apps are currently making less than $680/year.
This is a pretty thorough analysis.
Re: Full Analysis of iPhone Economics: Bad News?
#7"Now the heartbreaking news. Lets factor in our development costs. Again, independent source, the Internet Retailer reported on May 1, 2010, that most apps cost between $25,000 and $50,000 to develop."
These numbers were really taken out of the ass of a troll.
Re: Full Analysis of iPhone Economics: Bad News?
#8I'm not sure I buy that a typical iPhone app costs $35,000 to develop. Considering the simplicity of most apps, combined with the fact that many apps are effectively the same program with some content alteration, it seems like a really inflated figure.
It doesn't really make much difference, for the purposes of his analysis. Let's say a typical app costs $1500 to develop. If his other numbers are right, that typical app would take about 2.5 years to break even. His argument is that, on average, developing an iPhone app is, in itself, a fairly dismal economic proposition.
Re: Full Analysis of iPhone Economics: Bad News?
#9His entire analysis is basically taking the revenue total for all apps, divided by the number of apps, and saying each developer only makes an average of $3k per year. Sorry, this is not a good analysis. Some people give their apps away for free. Some quality apps make millions. This doesn't mean the opportunities are not there. A similar analysis could be done of PC shareware software authors, with similar results.
Nope, that's not what it is. He explicitly states that he excludes the free apps in the revenue analysis. He uses a combination of numbers from Apple and from other 3rd party services to come to the median revenue per paid app at something like $680/year. He also fully acknowledges that there are some extreme examples that make it big, but that half of all paid apps are currently making less than $680/year. This is a…
Then there's also the point that while some extreme examples made it 'big,' in the long run of things mobile, 3M downloads really isn't all that big.
Re: Full Analysis of iPhone Economics: Bad News?
#10I don't understand how this is any different than if you did an analysis of Startup Economics.
In any space with great competition and where your product is scalable, few will make enough money to justify their investment.
Also many paid apps are part of a bigger picture, the iPhone app is not the only revenue stream they have.
That's reality, now deal.