When it comes to games, originality is a crucial factor that's frequently overlooked. It's difficult for indie devs to compete against licensed properties (e.g. Temple Run: Brave) or against freemium games that can throw a lot of money on user acquisition. Creating truly original or interesting games is one way to compete against them. Unfortunately, the typical reaction is to just do a spin on high grossing casual games (e.g. Fruit Ninja) leading to a price war and generally low revenues.
When we made our running game, Zombies, Run!, we had absolutely no interest in competing with the freemium or 99c games - we don't have the properties or resources to do that. Instead, we made a game that straddles the fitness, gaming, and storytelling genres. We also charged $7.99, making it the most expensive game in the Top 200 Grossing today (even more expensive than Minecraft).
Part of the reason why we can do this is because we basically have no competitors - although obviously that made it a little harder to educate the market. I'm sure we will get competition, but the skills required to make the game (iOS dev, web dev, award-winning author, voice actors, sound producers, community support) are not trivial to find and organise.
Contrary to conventional wisdom, people will pay for an app that they think is original and worthwhile, and not just on iOS but Android as well (we're very happy with our Android sales).
I completely disagree. Angry Birds, quite possibly the most successful mobile game to date, is a completely unoriginal title that just looks prettier than most of its competitors.
You cannot simply attribute your success to originality, without looking at the other 650,000 apps and ranking them by originality as well, and then correlating that with success.
I would predict that originality falls behind a large handful of other factors when it comes to calculating the success of a mobile game. I would not be surprised if originality was not a statistically significant factor in a game's success.
Angry Birds was the first game of its kind that tons of people actually played. The fact that it looks prettier than the competitors is the reason why people actually played it. They pulled an Apple.
If there is an original game out there that is not catching on, it's likely that you can take it and do it better, and finally get traction. This still means it's an original game to the players.
Of course I think that other factors such as marketing, quality, and brand also matter a lot, but I think that smaller game studios would do better to see how they can differentiate themselves from the competition. Originality is one metric that doesn't need to cost a lot of money.
As both a game dev and a gamer, I don't think originality plays such an important role. All the games I paid for in app store so far are basically VERY GOOD clones of old and repeated ideas I've seen/played in the past: Kingdom Rush, Jetpack Joyride, Angry Birds, etc.
IMHO, it's how polished the game is, not how original...
What the analysis is missing, in my opinion, is sufficient emphasis on the age of the iOS App Store. Not only has the $5 billion has been paid out over four years - meaning even a 1% app won't necessarily replace a decent job in a Western European country or the US - but also that much of that 1% has probably gone to apps that are no longer in existence due to changes to the approval process, the developer agreement, the API, or simply the maturing marketplace - i.e. 650k represents the current number of apps in the marketplace not the total number of apps which have offered over the past four years.
That's not to say the analysis isn't a useful back of envelope calculation. Because what it shows is that the economics of the app store probably favor developing many lower quality apps in places with low cost of living - places where a few hundred dollars is significant income.
I have one of those 1% apps (barely). What the survey didn't ask me was how much I spent on the thing. I spent over 50k on marketing and maybe 10k total on other stuff like graphics. It also took 3 yrs to pull in that money so way below typical wage in a western country.
Another point, which trails from yours, is the percentage of spending over time. I would estimate the the iPhone/iPad early adopters were more apt to pay for an app than your average user today.
The article is not clear on this. But the data from the image is unrelated to the stat of 5 billion. The data was compiled over 7 days from 252 respondent 1 year ago. From that data, the median life time revenue of an app is about $3,000 and the distribution on revenue is a long tailed one. The OP is also misleading in that you can't assume a uniform distribution in each bucket. Quite likely the same uneven long tailedness would appear at each level.
The article is pretty clear. The income distribution data in the image is extrapolated across the entire App Store.
"Before reading the rest of this post, bear in mind that these numbers are not necessarily accurate, and may not be representative of other categories in the App Store. However, if they were representative, the back of our napkin would give a very different split from the default assumed position:"
1% of apps (6,500) would be sharing 36% of revenue
($1.75bn), i.e. an average of $269,230 per app
19% of apps (123,500) would be sharing 61% of revenue
($3.05bn), i.e. an average of $24,696 per app
80% of apps (520,000) would be sharing 3% of revenue
($150m), i.e. an average of $288 per app
Sorry you're right, on that aspect I was mistaken. But the caveats listed in the thread and the weakness of the assumption of a uniform distribution in each bucket makes it difficult to draw any meaningful conclusions beyond what the original article had. That is, I don't think the mean is useful at any level.
the article's main message that being in 19% is an easy target is based on the mistake brudgers discovered; namely 25K in 4 years, or <10K in 1 year is barely a good target for any company or indie developer.
that's a presentation trick from Apple, mainly not telling how much developers get in current quarter, but rather bragging about a rolling number. the blog writer was a victim of the apple trick of rolling the revenue given to the app devs back to the beginning of the known history.
As someone exploring the prospect of app sales as a career (working on my third app now, supplementing it with consulting work), I'm quite heartened by this article. There's a tenacious belief within the indie game-dev circles I bump around in that the _only_ way to profit from iOS sales is to win the top-ten lottery and join the 1% this article describes.
But the real story that Addey tells here says that Sturgeon's Law is in full effect in the App Store: if you can make your app _not crap_, if you can rise above the dross that inevitably makes up 80 to 90 percent of any sizable collection of creative work, then people will buy it. And if you're willing to act wisely and keep working at it, always pushing out more quality, care-driven stuff, then you can succeed.
The variance on a salaried job is basically zero. You at least have a chance of making it into the top 1% with app development. Unfortunately, you have a much greater chance of making it into the bottom 80%. Probably not the surest path to entrepreneurship but then what is, really? Also, if you are working for a company that is trying to make a profit primarily from app development, that zero variance proposition is pretty well off the table. There are certain advantages to working for yourself, regardless of the nature of the work.
There are certain advantages to working for yourself, regardless of the nature of the work.
Absolutely. But I think the big success stories have obscured the fact that for the average dev those advantages will come at a very high material cost.
That assumes that all of the apps are attempting to be businesses in their own right. There are loads of apps which simply support some other business, such as a shop, venue, sports team, TV programme and so on (typically those are free).
A better figure would be how many paid apps are there.
The apps he cites in the study are all games with some kind of price tag, whether up-front or IAP.
Other statistics show that games tend to rank higher in overall revenue than any other category so this might actually be painting an excessively rosy picture already.
Money isn't everything. If games are art, and many indie games certainly fit that description, then these figures may well be a more profitable and rewarding path for an artist than, say, making paintings.
There really seems to be a meme at the moment for stories about how difficult it is to make money on the iOS / Mac app store. Ever since the sparrow acquisition, it seems like every day there's another similar story on the front page of HN about how hard it is to make money there. Which, unfortunately for me, is quite discouraging because i'm about to launch an iPhone app in a week :(
Making iphone apps used to be good a few years ago when the store first opened. Not so much now. Earning $0.70 per sale is just not enough. And that's if your app can even be found. It's even worse with Android. With mobile overtaking PCs, it's a slightly depressing thought about the direction the software industry has taken.
There are "tons" of free apps on the App Store. Either completely, honest to God free, or ad-supported (usually from Google, so they're not paid by Apple)...
I wonder what the numbers would look like if we did the same calculations for websites instead of apps. Of course, it would be practically impossible to do but I bet that at least 99% of revenues would come from <1% of websites.
I think these results look great. Does anyone who's browsed the App Store really think that more than 1 in 5 paid games are even vaguely compelling? No, most of them are rubbish. The real story is, if these statistics are to be accepted, that there's one hundred thousand games earning real money. I'm genuinely impressed.
1. The calculation averages the gains throughout ALL apps - given the vast majority of the apps are free, that means the paid ones are getting a lot more revenue (individually)
2. It doesn't take into consideration advertising revenues (admob et all), which represent a considerable chunk of revenue for a lot of apps...
Not sure why this is surprising. If we could take out the apps that didn't try to make money (or could somehow run an experiment where all apps were paid), I wouldn't be surprised if the revenue distribution followed the 80-20 rule.
This doesn't seem to factor out the truly/intentionally free apps (i.e. no charge and no IAP). Doesn't that make the number of apps in each category too high and, hence, the revenue per app too low?
Paraphrasing Tim Bray, selling bags of bits is probably not a good business model for most of the people. (Unless you have draconian DRM measures in places.)
How much does quality matter in terms of iOS marketshare? Or is it mainly marketing driven?
For example, if I have time but not money and invest lots of time into creating a high quality iOS app for a niche market does it stand a chance or rising to the top or will it simply fall into obscurity without being featured by apple etc?
The app market is extremely competitive now. You need a quality app and a serious marketing effort to make real money. Just tossing an app up on the store among 600k other contenders isn't going to get you far.
When we made our running game, Zombies, Run!, we had absolutely no interest in competing with the freemium or 99c games - we don't have the properties or resources to do that. Instead, we made a game that straddles the fitness, gaming, and storytelling genres. We also charged $7.99, making it the most expensive game in the Top 200 Grossing today (even more expensive than Minecraft).
Part of the reason why we can do this is because we basically have no competitors - although obviously that made it a little harder to educate the market. I'm sure we will get competition, but the skills required to make the game (iOS dev, web dev, award-winning author, voice actors, sound producers, community support) are not trivial to find and organise.
Contrary to conventional wisdom, people will pay for an app that they think is original and worthwhile, and not just on iOS but Android as well (we're very happy with our Android sales).