Mobile apps to generate untold riches for developers
Even when they're free, says analyst
Smartphone owners will together spend a staggering $6.2bn on applications this year, market watcher Gartner has forecast.
The company calculates that, in 2009, we spent $4.24bn, and with analysts unanimously anticipating yet more iPhones, BlackBerries, Palms and Android handsets to be purchased in 2010, Gartners' predicted revenue jump of almost 60 per cent doesn't sound unreasonable.
More amazing, perhaps, is the fact that all that cash will come from just 18 per cent of the applications we download. The remaining 82 per cent of apps are freeware. Now, Gartner said some 4.5bn apps will be downloaded in 2010, so that means just under 810m of them will require paying for.
That's an average price of $7.65 per app.
Most mobile apps cost rather less than that, which just goes to show why the likes of TomTom, CoPilot developer ALK and everyone else making iPhone satnav applications - which typically cost rather more than $7.65 - were all running around Las Vegas earlier this month hosting gigs in exclusive nightclubs and generally spending money like it's going out of fashion.
They are, in short, rolling in the stuff, and it's all thanks to their new mobile apps.
Kerching.
And the Croesus-style excess will continue. In 2013, Gartner reckons, global app store revenues will total $29.48bn.
Even the free apps will be pumping money into their developers' bank accounts, thanks to the advertising they will inevitably present to the users. In 2010, this kind of advertising will generate $600m - almost nine per cent of the total - rising to $7.38bn - 25 per cent of total app revenue - in 2013.
It's not all good news for developers, mind. Gartner warns that, as smartphones go mainstream, they'll be bought and used by less tech-savvy punters, folk less likely to spend willy-nilly on new apps.
Maybe, but we reckon they won't be able to resist the free stuff, and so the balance of revenue will shift from application purchases to in-app advertising. ®
COMMENTS
Big guns
If you do the Math, that equates to $60,000 per app listed in the store.
iPhone apps cheaper than other platforms
Can't speak about all platforms, but I can say that where the same app is available for iPhone as it was for my previous phone (SE p910 - Symbian) the iPhone versions were substantially cheaper than the p910 version used to cost. Interestingly, in the case of IM+ the cost of the Symbian version has now dropped to the same as the iPhone, while QuickOffice is still cheaper than the Symbian or Palm versions.
If anything, from where I'm sitting, the prices for iPhone apps have been driving down the costs for other platforms.
The dangers
... of extrapolating from a single point
It does sound as if Gartner (quick: who said "The thing I love about science is that you get so much speculation from so little data"?) have taken one year's sales figures and presumed that every subsequent year will follow the same pattern. Conveniently forgetting that all the early adopters are the monied fanbois who are willing to buy anything if it's shiny enough.and has the right logo associations.
When smartphones start to be used by "real people" I think they'll quickly find that the proportion of users who are willing to pay for applications is a small percentage of what the first generation did. Further, I'd guess they are likely to have far fewer applications (paid or free) on their phones, too.
Now we all know this isn't just a survey, it's a GARTNER survey, but I still wouldn't bet my future income on it's accuracy or validity.
more money than sense
Apple has been a more money than sense type brand for years. It's only since i started approaching a decent income myself that i even started to consider apple products.
Precisely
I quite agree regarding the money making opportunity, but from the point of view of the platform would suggest this doesn't do Apple any good at all.
Case in point: I saw one of those iPhone ads the other day pointing at - among other apps - a VNC client for a whopping £14.99. Now, it isn't a secret that Apple users are overcharged for their products but a very effective VNC client on my Android (or my previous Windows Mobile) cost me zero, zilch, nothing. Whatever additional benefits the iPhone version MAY provide, I doubt they're worth that much.
The public are taking note, and the high cost of iPhone apps is beginning to grate. Yes, there are thousands of fewer (fart) apps on Android, yes market forces may eventually synchronise the two, but it isn't going to take a lot for Apple owners to be branded with a more-money-than-sense stigma that has done for other designer brands.
