iPhone Developer Tapulous Captures Sales of Nearly $1 Million Per Month

[MacRumors]

http://www.macrumors.com/images/macrumorsthreadlogo.gif (http://www.macrumors.com/2009/12/21/iphone-developer-tapulous-captures-sales-of-nearly-1-million-per-month/)

Reuters reports (http://www.reuters.com/article/idUSTRE5BJ06020091220) on iPhone developer Tapulous (http://tapulous.com/), the team behind the popular Tap Tap Revenge applications, noting that the small company is reportedly bringing in nearly $1 million per month in revenue. The success of Tapulous, which boasts only 20 employees, illustrates the ability of small development firms dedicated to the iPhone to carve out profitable niches for themselves in the App Store.Tapulous -- with a mere 20 employees -- said its "Tap Tap Revenge" game series has now been installed more than 20 million times, with more than 600 million total games played.

Earlier this year, research group comScore said the game had been installed by one-third of Apple app users.Tapulous' business model relies on a combination of revenue sources: paid application downloads, ads, and paid downloadable song content within applications.

The report notes that Tapulous has raised $2.8 million from investors and is now profitable. While the vast majority of iPhone applications come from small developers lacking the support of outside investors, a number of companies, including Smule (http://www.macrumors.com/iphone/2009/02/16/smule-raises-3-9-million-in-venture-capital/) and Ngmoco (http://www.macrumors.com/iphone/2009/03/23/ngmoco-raises-additional-10-million-in-financing/), have been able to capture the imaginations of angel and venture capital investors. With the backing of these investors, these developers have been able to create well-financed startup development houses looking to develop dedicated iPhone application pipelines and sustainable business models.

Article Link: iPhone Developer Tapulous Captures Sales of Nearly $1 Million Per Month (http://www.macrumors.com/2009/12/21/iphone-developer-tapulous-captures-sales-of-nearly-1-million-per-month/)

[///M5]

So? Is this supposed to encourage us develop apps for the iPhone? :rolleyes:

[hugodrax]

I wonder if Windows mobile made this much for its independent app writers.

[Compile 'em all]

I wish I could capture 0.0000000000001% of that :(

[kdarling]

So? Is this supposed to encourage us develop apps for the iPhone? :rolleyes:

Sure, just get $2.8 million in seed money like they did, hire 20 people, and start writing highly desirable games.

(They were especially smart to have song sales within their apps.)

[Vandam500]

That is impressive indeed

[stagi]

Wow that is very impressive!

[brianadkins]

I wish I could capture 0.0000000000001% of that :(

... you're asking for a tiny fraction of a penny every month?

[slu]

Not bad for what appears to me to be no more than a Guitar Hero rip off.

[nim23]

I wish I could capture 0.0000000000001% of that :(

??

Sounds like if you had a head full of dynamite, you wouldn't have enough to blow your hat off...

Having said that, hats off to all the successful app developers out there, wish I was capable of developing. I think there is a fortune to be made in the industry.

[doobi18]

Anyone know how much NateTrue sold the game (Tap Tap Revolution) to Tapulous for?

[fribhey]

am i the only one who thinks this game sucks?

[ChazUK]

Wirelessly posted (Mozilla/5.0 (Linux; U; Android 1.5; en-gb; Archos5 Build/CUPCAKE) AppleWebKit/528.5+ (KHTML, like Gecko) Version/3.1.2 Mobile Safari/525.20.1)

Good going IMO.

Just goes to show that: Decent app + iTunes app store = Win

[Kilamite]

Surprised it's possible to get an app or few out there and wave so much cash in consistently.

[igazza]

1 million sales plus 30% of apple tax :rolleyes::rolleyes:

impressive

[sushi]

Good news!

am i the only one who thinks this game sucks?
Obviously, there must be many who enjoy their games.

[Kilamite]

1 million sales plus 30% of apple tax :rolleyes::rolleyes:

30% is nothing - developer gets 70% and doesn't have to worry about transactions etc, and gets paid routinely too. The model works and I don't think a single developer would argue against Apple's "tax" for the benefits they get.

[eastcoastsurfer]

Instead of averages or total numbers, I'd like to see the median of developers making enough money on the app store to sustain themselves. Stories like this are very much like winning the lottery.

[sbrhwkp3]

Instead of averages or total numbers, I'd like to see the median of developers making enough money on the app store to sustain themselves. Stories like this are very much like winning the lottery.

Eh... that would depend entirely on their business model.

There are developers out there that invested practically nothing but their time into their apps and are cashing in, then there are developers like this one that had huge sums invested and came out on top.

It may be a bit of a crap shoot, but it's much like a pioneers journey more or less. They've gotta have the right idea for an app and the right plan in order to make it happen.

[roach]

It would be amazing if they consistently made that much every month, but once the market gets flooded with similar products... adios million dollar a month.

[DipDog3]

Instead of averages or total numbers, I'd like to see the median of developers making enough money on the app store to sustain themselves. Stories like this are very much like winning the lottery.

It's all about marketing!

That is what really matters!

[igazza]

30% is nothing - developer gets 70% and doesn't have to worry about transactions etc, and gets paid routinely too. The model works and I don't think a single developer would argue against Apple's "tax" for the benefits they get.

apples 30% cut could be tens of millions per day. i dont think the app store costs that much to run..

But your right developers are happy.

[Goona]

apples 30% cut could be tens of millions per day. i dont think the app store costs that much to run..

But your right developers are happy.

LOL you don't think the app store costs that much to run, I'm guessing you work at Apple headquarters?

[kdarling]

There are developers out there that invested practically nothing but their time into their apps and are cashing in, then there are developers like this one that had huge sums invested and came out on top.

Developer time is not "nothing" :) It's pretty much everything, in fact.

Perhaps you meant that there are developers who invested practically NO time in making their apps?

30% is nothing - developer gets 70% and doesn't have to worry about transactions etc, and gets paid routinely too. The model works and I don't think a single developer would argue against Apple's "tax" for the benefits they get.

Perhaps not most smalltime guys, but I would think that major development companies don't like Apple's tax at all.

For example, companies like Sling and TomTom usually sold their apps through their own websites. Their apps are popular enough for people to seek out on their own.

[Compile 'em all]

It's all about marketing!

That is what really matters!

Many apps made ZERO marketing and reached #1 top paid in the states.

[sesnir]

30% is nothing - developer gets 70% and doesn't have to worry about transactions etc, and gets paid routinely too. The model works and I don't think a single developer would argue against Apple's "tax" for the benefits they get.

The only thing I'd complain about is the fact that Apple holds onto all the money until they feel like giving us our share (technically when the amount owed in a region for an app is at least $150). Lowering the price of an app to free means you'll never see the money owed to you unless you start charging something again.

Most developers probably don't break even on their costs with iPhone development. I'm about ~2200 from breaking even, not counting my time or my MBP.

[jbplaya]

I like Tap Tap Revenge 2!

[polaris20]

Perhaps not most smalltime guys, but I would think that major development companies don't like Apple's tax at all.

For example, companies like Sling and TomTom usually sold their apps through their own websites. Their apps are popular enough for people to seek out on their own.

Perhaps not, but it's quite simple: if a developer doesn't like the deal, then don't develop for the iPhone.

If I were a big software house I'd be pissed too, but seeing as how 70% is better than 0%, and companies like this Tapulous are bringing in 12mil a year, it's not such a bad deal.

It depends on how much development time is spent. Either it's worth your time or it isn't. If your app generates 12mil in revenue a year, you get 8.4mil of it, but your development costs are 15mil, then clearly it's not a good investment of time.

But somehow I doubt it costs them that much to develop an iPhone app.

[Manderby]

have been able to create well-financed startup development houses looking to develop dedicated iPhone application pipelines and sustainable business models.
... , will fail do so, does not to hit the market with another successful product, asks a consultant company for help due to request of the board of directors, needs to acquire third-party support, finally gets sold to a bigger company and gets outsourced.

SCNR. :)

This is just one success. They did it right. But who knows how they perform in the future.

[leomac08]

how do you split 1 million dollars in earnings between 20 people?:D

the CEO might be greedy.;)

[kdarling]

If I were a big software house I'd be pissed too, but seeing as how 70% is better than 0%, and companies like this Tapulous are bringing in 12mil a year, it's not such a bad deal.

It's not a good deal either, since that would mean they're paying 5 million a year to Apple.

There's also the problem of having to wait for Apple to approve an app and its updates. That results in lost revenue as well. Not to mention watering down the app itself at times, such as with the crippling of Slingplayer to only work on WiFi.

Is it better than nothing? Sometimes. Better than not having an Apple tax? No way. Large companies should be able to distribute their app on their own, if they wish.

It's ironic that Jobs made fun of the carrier walled app gardens ... since it turns out that he simply wanted to own such a garden himself.

[Merkuryy]

Instead of averages or total numbers, I'd like to see the median of developers making enough money on the app store to sustain themselves. Stories like this are very much like winning the lottery.

After the final exam next month, maybe I'll do a dee research on the average revenue of developers on the app store, iTunes itself already hold the information we need:)

[oldwatery]

Oh my, so now VC companies are being created just to support iPhone app builders!
Gentlemen start your new Stock Market "app" bubble. :D

[tonyshucraft]

In regards to "the apple tax", does anybody realize that it does cost money to do the credit card transactions and all that stuff? It may end up being 20 percent of thirty in the end, when it comes to costs, but there is a lot to consider in that. Hell, you could be a musician under some record label that pays you a lot less compared to this.

[CFreymarc]

After the final exam next month, maybe I'll do a dee research on the average revenue of developers on the app store, iTunes itself already hold the information we need:)

While I'm sure that everyone who has an app on the store has good technical skills, it is ones social, interpersonal skills that makes the sales. If you have a brilliant app that is not selling well, you are not communicating how great it is to your market.

I have no sympathy for those that write great apps and then ignore the public only to move on to their next great technical conquest. If you are a solo, independent developer, you should have at most one third -- yes one third! -- of your time to coding and other technical issues. The rest needs to be advertising, promotions and -- shudder! -- public gatherings to show off your app.

I've been to many developer conferences and I can always spot those who's apps are not selling well from just how they work or don't work the crowd. A simple ad on a web site or in a magazine for your app can create a boost in sales.

In summary: poor sales = poor social skills

This also leads to why a lot of developers can't get dates!

[stagi]

It's not a good deal either, since that would mean they're paying 5 million a year to Apple.

There's also the problem of having to wait for Apple to approve an app and its updates. That results in lost revenue as well. Not to mention watering down the app itself at times, such as with the crippling of Slingplayer to only work on WiFi.

Is it better than nothing? Sometimes. Better than not having an Apple tax? No way. Large companies should be able to distribute their app on their own, if they wish.

It's ironic that Jobs made fun of the carrier walled app gardens ... since it turns out that he simply wanted to own such a garden himself.

I do agree with you to an extent, I think large developers are hit from the 30% compared to a small dev who might not have the marketing presence but gets into the top 10 and starts to get the exposure they might not have received before. For them I think the 30% is more than worth it and a great way to get their app out in front of millions that they couldn't do before.

[KnightWRX]

Developer time is not "nothing" :) It's pretty much everything, in fact.

Oh please, you forget the Mac Mini they need to buy to write and compile the code. That 599$ isn't going to pay for itself! :rolleyes:

Time is pretty much everything for every content profession, be it music, movies, software, theater, books. The material costs are almost nothing in those industries, hence why copyright is needed to protect such works in the first place (close to 0 duplication costs).

[Diode]

Instead of averages or total numbers, I'd like to see the median of developers making enough money on the app store to sustain themselves. Stories like this are very much like winning the lottery.

I would beg to differ. If your an excessively smart person in your field, then success is not pure chance.

[KnightWRX]

I would beg to differ. If your an excessively smart person in your field, then success is not pure chance.

You've just made his point for him. His point wasn't that it is chance, just that very few will come out on top, while the majority struggles. The lottery example probably wasn't the best choice to illustrate it.

[uaecasher]

I wish I could capture 0.0000000000001% of that :(

you just did, I just bought one of your apps :)

[eastcoastsurfer]

I would beg to differ. If your an excessively smart person in your field, then success is not pure chance.

Success and making $1M/month are not one in the same. If you're smart and work hard you can be successful. To go from that to making $1M/month you need luck and timing, and often times those are much more important than simply being smart.

[rockosmodurnlif]

am i the only one who thinks this game sucks?
No, you're not. I don't understand who buys that game. tap, tap, tap to a beat? It's not like it's Rolando or Red Conquest or something like that.

Then again a fart app was tops at some point during the year so shows how much my opinion matters.

More power to 'em. At least it's 20 people with jobs.

[lilskaterpunk]

Damn! Very impressive! :)

[kdarling]

I do agree with you to an extent, I think large developers are hit from the 30% compared to a small dev who might not have the marketing presence but gets into the top 10 and starts to get the exposure they might not have received before. For them I think the 30% is more than worth it and a great way to get their app out in front of millions that they couldn't do before.

I totally agree with you that it's a good deal for small developers.

Heck, when I was selling personal computer apps back in the 1980s, developers only got 15-30%. Of course, there was physical media involved and actual mailing :)

I would beg to differ. If your an excessively smart person in your field, then success is not pure chance.

True, but success is not guaranteed in that case either. You still have to sell your skills or products.

[mambodancer]

I'm surprised about the comments people make about the 30/70 split between Apple and developers. It's almost like no one on this board remembers (knows) what it's like (or used to be like) to get your software on a retail store shelf.

When I was the buyer for a small, independently owned retail computer store back in the mid to late nineties, all of our software and supplies were purchased from a distributor like Ingram/Micro D. The distributors supplied a catalog of products they distributed and you would pick and chose the products you wanted to stock. If one distributor didn't have a product you wanted, you shopped another distributor. If the product was available from multiple distributors, you contact the buyer and negotiate the best deal you could get. Margins on software was typically between 25 and 50%. The larger your store, the more buying power you had, the better your margins. Our store typically dealt with 2-3 primary distributors for all the product we had to sell. We dealt with the hardware companies like Apple and IBM directly. Occasionally, we were prohibited from buying certain software applications because of requirements by the vender (a grey market for these products developed because of this).

If a small startup company, say Quark, wanted to sell their new desktop publishing application to us (we had our store in Boulder), the president or vice president would come by after jumping through a few of our hoops, to give us a demo, tell us about their promotions, give us demo copies, offer to train our sales reps, negotiate margins, offer exclusivity deals, and set up buying terms (we order the product, get net 60 and get to return unsold product after so many months). More often than not, we told them we were interested but only if they could negotiate a deal with one of our distributors because, our buying power, terms, bills we had to pay, all made it easier to deal with just a few distributors rather directly with the companies themselves. Fundamentally, getting your product on a store shelf hasn't changed much since those days. It is still basically the same where I used to work at Microcenter but the number of brick and mortar/Mom & Pop stores isn't what it used to be in the 80's and 90's. In fact, it's probably even more competitive now than it every used to be.

The bottom line, not even considering all the hoops a developer has to jump through for this, they are going to give up upwards of 60% of the retail cost of the product just to get it into a distributor. They'll have to have financing to do that, manufacturing and customer returns to deal with as well. There is a lot more infrastructure costs by far than those dealing with a 30/70 split with Apple. I'm just surprised no one else though about it sooner.

[eastcoastsurfer]

I'm surprised about the comments people make about the 30/70 split between Apple and developers. It's almost like no one on this board remembers (knows) what it's like (or used to be like) to get your software on a retail store shelf.


I remember it, but the internet fixed that and allowed the producers to go directly to consumers. So what you're saying is that Apple is taking us a few steps backwards?

[ArrowSmith]

Sure, just get $2.8 million in seed money like they did, hire 20 people, and start writing highly desirable games.

(They were especially smart to have song sales within their apps.)

This. This is nothing new to game development on any platform. This is not a special "ooh ooh iPhones success story unique to the history of making money in apps!". Nothing to see, move along. Also to anyone who understand the history of gaming revenue, this $1million/month is not going to last for very long.

[hitekalex]

I remember it, but the internet fixed that and allowed the producers to go directly to consumers. So what you're saying is that Apple is taking us a few steps backwards?

Exactly.. Problem with Apple's 30% tax isn't the tax in and of itself.. but the fact you cannot avoid it, if you want to legitimately sell apps for iPhone. Apple basically forcefully inserted itself as an unavoidable middle man between the developer and a consumer.

It would have been a different story if iPhone supported other 3rd-party "app stores", that could complete with Apple's.. or simple side-loading of apps (like Android does). But right now.. don't want to pay 30% Apple fee and would rather market/sell apps yourself? Tough luck, you can't.

I hope FTC steps in here at some point and set some rules against this type of behavior.. which is fundamentally anti competitive and not good for anyone in the long run.

[healeydave]

OMG, back when the iPhone v.1 was only available in the USA and I was speaking regularly to the people writting apps via the hacked code-base (long before Apple decided to put out their own developer kit), I'm pretty sure Nate wrote the original version of that called "Tap Tap Revolution".

I seem to recall someone bought the rights to it off him, probably the guy that is now Tapulous. I bet Nate thought he did well out of that at the time, but if he's doesn't get any royalties from it now, I bet he's pi**ed!!

[ZebraineZ]

Wow, if the 20 employees get 70%, they get about 30-40k per month, so each year they could about 300-500k each ... Rich...

[doctor-don]

... , will fail do so, does not to hit the market with another successful product, asks a consultant company for help due to request of the board of directors, needs to acquire third-party support, finally gets sold to a bigger company and gets outsourced.

Say WHAT? :confused:

This is just one success. They did it right. But who knows how they perform in the future.

But who knows how they WILL perform in the future? :rolleyes:

[doctor-don]

Wow, if the 20 employees get 70%, they get about 30-40k per month, so each year they could about 300-500k each ... Rich...

$1 million X 70% ÷ 20 = $35,000.

$1 million X 70% ÷ 30 = $23,000.

Those figures do not include overhead, taxes, or other costs of doing business.

And it is doubtful that this is sustainable.

[doctor-don]

... you're asking for a tiny fraction of a penny every month?

No response from Compile 'em all? :confused:

[Superdelphinus]

isn't it basically just a copy of guitar hero?

[XxEjGxX]

think of this from apple's perspective, they take something like 30% don't they, so that is $300,000 a month just for 1 app! They have over 1million apps (granted a lot are free and tap tap is the most popular one) but they must be turning over tens of thousands of dollars a day. Big steve will be having a merry christmas!

[Shodan]

Exactly.. Problem with Apple's 30% tax isn't the tax in and of itself.. but the fact you cannot avoid it, if you want to legitimately sell apps for iPhone. Apple basically forcefully inserted itself as an unavoidable middle man between the developer and a consumer.

It would have been a different story if iPhone supported other 3rd-party "app stores", that could complete with Apple's.. or simple side-loading of apps (like Android does). But right now.. don't want to pay 30% Apple fee and would rather market/sell apps yourself? Tough luck, you can't.

I hope FTC steps in here at some point and set some rules against this type of behavior.. which is fundamentally anti competitive and not good for anyone in the long run.

I am sorry but this is utter rubbish.

There are plenty of other platforms for developers to develop on.

Have one's cake and eat it? Apple CREATED the App Store, it is their creation, their rules. their jurisdiction.

A lot of people do not seem to understand that - there would not be the platform for people to make any money on had it not been for Apple creating the the App Store.

How is it anti-competitive?

[johnsawyercjs]

In regards to "the apple tax", does anybody realize that it does cost money to do the credit card transactions and all that stuff? It may end up being 20 percent of thirty in the end, when it comes to costs...

Credit card transaction fees charged to large merchants (like Apple) by the card companies are more along the lines of 2% on average (and debit card charges are much less), though American Express charges more, which is why many merchants don't accept it.

[johnsawyercjs]

Lowering the price of an app to free means you'll never see the money owed to you unless you start charging something again.

??

[MattInOz]

Wow, if the 20 employees get 70%, they get about 30-40k per month, so each year they could about 300-500k each ... Rich...

Well they use a alot of licensed content in there apps so not all that revenue is going to running the business per say. Plus they have venture capital investment so those would want to see some percentage of the revenue banked as profit to start retiring the debt.

plus a staff member will need a place to work, power, computer, internet access other supplies in order to stay productive.

So under a general business model wages are maybe a 1/3 of 1/3 average wage would be just under $70K. Still not bad.

[Cask]

I am sorry but this is utter rubbish.

There are plenty of other platforms for developers to develop on.

Have one's cake and eat it? Apple CREATED the App Store, it is their creation, their rules. their jurisdiction.

A lot of people do not seem to understand that - there would not be the platform for people to make any money on had it not been for Apple creating the the App Store.

How is it anti-competitive?

It might not be anti-competitive, but it is not good for the consumer either or developers either. Apple is not the SOLE distributor of APPs designed to run for MacOS are they??? Software developers have a choice on how to distribute their software, be it directly online, throught countless retailers or if they want through Apple.

Same thing thing for Microsoft, they created Windows, but they don't force software developers to sell through them. Imagine the kind of criticism Microsoft would get for doing that? Just because it is Apple on it's magical iPhone, do you think it should be any difference? With the upcoming competition from the Android platform, which is just starting, Apple will have to rethink their strategy. Before this year, the iPhone really had no true competition, as it was the only one in its class. But we the Droid, the upcoming Android Devices, WebOS to an extent, Apple is going to have to make radical shifts to still be the leader. Customers want choice and so do developers, and they are not getting any from Apple.

[holmesf]

App store recipe for success:

1. make something (it doesn't matter what)
2. publish your profits
3. get free press from publishing profits
4. make more money from free press
5. goto 2

[kdarling]

Lowering the price of an app to free means you'll never see the money owed to you unless you start charging something again.
??

Apple doesn't pay out to a developer until the amount Apple owes them in any region goes over a set amount, perhaps $250.

So if he only sells $300 worth of an app in a region ($210 his share), then gives up and drops the price to free, he won't ever see his money... unless he goes back to selling it again.

And there are seven regions. So Apple could owe him $249x7 = $1743, but he won't get paid. Limits like this are frustrating to all the tiny developers.

(Although I thought there was a time limit even on small amounts, where eventually they pay? Not sure.)

[Compile 'em all]

No response from Compile 'em all? :confused:

I didn't mean the number quite literally. I was just implying that I wish I could earn even a tiny little fraction of what these guys are making.

The reality of the App Store is that most devs aren't making any money. You would be surprised at the amount of sales you need to make it into the top 100 in a certain category. A copy or two per day is enough. This can only mean that some devs sell absolutely zero copies of their apps. Heck, in some countries like Spain you can be doing 4 copies a day and you are already #2 in news.

[Sander]

Credit card transaction fees charged to large merchants (like Apple) by the card companies are more along the lines of 2% on average (and debit card charges are much less), though American Express charges more, which is why many merchants don't accept it.

"To large merchants" is the keyword here. If you look up how much you'd pay to an intermediate like PayPal, I'm sure if you rolled your own webstore selling $0.99 apps, you'd come out in the negative.

Regarding the "median" of App Store revenue, I'm sure it will be quite sobering. I wrote an article on my App Store adventures here (http://www.curly-brace.com/iphone.html), should you be interested.

[Shodan]

. Customers want choice and so do developers, and they are not getting any from Apple.

You missed the point - they made the choice for developing for it.

You don't go to a Ferrari garage to buy a Porsche.

[iphonedev11]

Simply amazing. The iPhone has really paved the way for developers to become over night millionaires. Very interesting to see all these iPhone millionaires emerge...

[itransition]

Suppose that iphone application development becomes unprofitable for big software development companies. The average cost of custom iphone applications could be no more than $10000 so it's hardly possible to find great number of customers to cover good income.