Apple's App Store Still Number One in Revenue Despite Google Play Growth

[AppleScruff1]

I love my iPhone but you need to quit drinking the kool aide. Apple is in trouble.

Personally I don't see how Apple is in trouble. The record profits and growth can't continue forever. Apple is currently as solid a company that exists today and they aren't going anywhere in the near future. They may go back to being more of a niche player, but then again that's what they have been for a good part of their history. Other than being a shareholder with totally unrealistic expectations, I don't necessarily see that as a bad thing. IMO, it was crazy to think that the stock was going to continue to go up $100 per month forever.

As a consumer, I could care less how much profit they make or what their market share is as long as they continue to turn out good products and are able to support them as they currently do. And I have no doubt that they will have new products in the future, it's just not going to be a new market segment created every year, and nor was it in the past.

 

[4TheLoveOfTech]

Wait a second - lower overall profit means lower App Store profit? For all you know, the lower overall profit could be from increased spending.

Alright, whatever you say. I wouldn't think that any big company would pay someone to do this, but you've probably convinced people besides me. I mean, you're always quick to turn up with some article on how iOS is less secure or worse in some way than Android, and it makes people wonder why you have those links sitting around.

The profit from the App store will fall as market share continues to fall. It will take a while but unless something disrupts the current trend it will happen sooner than Apple wants to admit.

I don't have "those links sitting around". I follow the tech industry and have access to a search engine. It's not tough to find facts to back up a post when you've lived through it. That's what a search engine is for. Just another part of the business that Apple didn't get into so I use Google.

 

[cdmoore74]

Sites like MacRumors, 9to5mac, theverge and engadget really don't want to face the facts. Everyday that goes by Apple loses something. I still remember when I wanted a iPhone on Verizon and iPad had like over 80% of the tablet market. Those days are gone. Even if Apple has successful launches with the iPhone 5s, iPad 5 and iPad mini 2 how long do you think it will last? I will bet anyone that iPhone 5s will become boring after the holiday's. Once the mini receives the retina display what's left? Once Apple releases a slightly larger iPhone 6 what's left. It all the same old products getting sequels.
I doubt an iWatch or Apple tv will save Apple.

 

[4TheLoveOfTech]

Personally I don't see how Apple is in trouble. The record profits and growth can't continue forever. Apple is currently as solid a company that exists today and they aren't going anywhere in the near future. They may go back to being more of a niche player, but then again that's what they have been for a good part of their history. Other than being a shareholder with totally unrealistic expectations, I don't necessarily see that as a bad thing. IMO, it was crazy to think that the stock was going to continue to go up $100 per month forever.

As a consumer, I could care less how much profit they make or what their market share is as long as they continue to turn out good products and are able to support them as they currently do. And I have no doubt that they will have new products in the future, it's just not going to be a new market segment created every year, and nor was it in the past.

I don't disagree with your posts often (I think this is the first time I do).

Apple's market share is sliding in every device sold far quicker than any analyst projected and it doesn't look like it's going to change in the near future.

Apple has a lot of cash and a huge market share in the US but I don't see that continuing to happen with great alternatives in both the high end and low end PC and Mobile arena.

Even if Apple puts out a cheap iPhone there are going to be a 100 other vendors that will undercut them with features that will match or exceed what Apple will offer.

You may not care if they are the biggest or have less (or very little) market share if you aren't a stockholder but I think "if" it happens and developers and businesses start to put out Android only products (home automation, car automation, mobile apps) then my guess would be your opinion is going to change.

I have no idea how old you are but unless you were in business in the 80's and saw the same thing happen and Apple became a second class citizen to Microsoft then I don't think you can appreciate how quickly the tide changed even if Apple did have a better GUI at the time.

 

[Michael Scrip]

Apple is losing profit. It doesn't take a genius to see the pattern.

So how far down will this pattern go?

Will Apple keep making less and less profit over time... and will ultimately have to close up shop?

Anything's possible, right? But even though Apple's profit are going down at the moment... they are still making billions of dollars.

And let's not forget that Apple has $100 billion in cash as a safety net.

Meanwhile... there are other companies who actually post losses. Aren't those the companies we should be worried about?

For instance... shouldn't HTC go out of business before Apple?

 

[sexiewasd]

The profit from the App store will fall as market share continues to fall. It will take a while but unless something disrupts the current trend it will happen sooner than Apple wants to admit.

I don't have "those links sitting around". I follow the tech industry and have access to a search engine. It's not tough to find facts to back up a post when you've lived through it. That's what a search engine is for. Just another part of the business that Apple didn't get into so I use Google.

Except that app store revenue has increased while market share has fallen.

The AppStore made 2.6 times more revenue for developers than the Play Store did at the same time that Android's market share grew to over 75%.

Just another interesting tidbit is that not only does Google make more money on iOS, they actually loose money on android when you account for expenses.

 

[AppleScruff1]

I don't disagree with your posts often (I think this is the first time I do).

Apple's market share is sliding in every device sold far quicker than any analyst projected and it doesn't look like it's going to change in the near future.

Apple has a lot of cash and a huge market share in the US but I don't see that continuing to happen with great alternatives in both the high end and low end PC and Mobile arena.

Even if Apple puts out a cheap iPhone there are going to be a 100 other vendors that will undercut them with features that will match or exceed what Apple will offer.

You may not care if they are the biggest or have less (or very little) market share but if you aren't a stockholder but I think "if" it happens and developers and businesses start to put out Android only products (home automation, car automation, mobile apps) then my guess would be your opinion is going to change.

I have no idea how old you are but unless you were in business in the 80's and saw the same thing happen and Apple became a second class citizen to Microsoft then I don't think you can appreciate how quickly the tide changed even if Apple did have a better GUI at the time.

I clearly remember Microsoft taking over. I personally think Apple grew too big too fast. I don't think any company can sustain the record growth that Apple has exhibited the past few years. And during a worldwide economical slump to boot

At a certain point, there is nowhere to go except down. But how much? Why can't Apple be a niche player, albeit on a larger scale than they were in the past? Microsoft has fallen from the throne, but they certainly aren't going anywhere either.

Also. even as Apple's market share diminishes, we are still talking over 100 million i devices per year. Unless that falls to minimal numbers, I don't think that developers are going to jump ship. I see your point, if this trend continues for 5 years and the total number of iOS devices dwindles then developers will jump ship.

I think it's fairly well known here that I am not a defender of Apple the corporation.

 

[Michael Scrip]

Sites like MacRumors, 9to5mac, theverge and engadget really don't want to face the facts. Everyday that goes by Apple loses something. I still remember when I wanted a iPhone on Verizon and iPad had like over 80% of the tablet market. Those days are gone. Even if Apple has successful launches with the iPhone 5s, iPad 5 and iPad mini 2 how long do you think it will last? I will bet anyone that iPhone 5s will become boring after the holiday's. Once the mini receives the retina display what's left? Once Apple releases a slightly larger iPhone 6 what's left? It all the same old products getting sequels.
I doubt an iWatch or Apple tv will save Apple.

Will the Galaxy Tab 4 or Galaxy Note 10.1 II be amazing?

How about the Galaxy S5?

I guess my point is... isn't everyone else just making sequels?

If Apple isn't doing anything exciting anymore... who is?

BTW... an Apple iWatch would sell 50 times more than an HTC smartwatch or LG smartwatch

 

[sexiewasd]

I clearly remember Microsoft taking over. I personally think Apple grew too big too fast. I don't think any company can sustain the record growth that Apple has exhibited the past few years. And during a worldwide economical slump to boot

At a certain point, there is nowhere to go except down. But how much? Why can't Apple be a niche player, albeit on a larger scale than they were in the past? Microsoft has fallen from the throne, but they certainly aren't going anywhere either.

Also. even as Apple's market share diminishes, we are still talking over 100 million i devices per year. Unless that falls to minimal numbers, I don't think that developers are going to jump ship. I see your point, if this trend continues for 5 years and the total number of iOS devices dwindles then developers will jump ship.

I think it's fairly well known here that I am not a defender of Apple the corporation.

I think that line right there nails it.

 

[marksman]

Except you wrongfully assume that high-quality apps on one platform are priced equally to the other platform. This is far from the case.

I haven't used any android tablets so I cannot speak to that. I can speak to your unnecessarily childish manner in which you compare the apps, however.

Apple has strict requirements, yes. These requirements also prevent apps that Apple deems "unethical". Case in the point: the absurd app which has you throw your phone as high as you can and gives you a score based on that. Available on Android, not available on iOS. Dumb? Yep. Poor-quality app? Nope. Apple simpled decided it shouldn't be allowed, because they say so.

Android is an open market, Apple is a closed market with a closed set of restrictions, which will reject you for no other reason than they don't like you very much.

I abandoned Android devices because I couldn't find one that would work for more than 10 months. I enjoy the high quality hardware of my iPhone 5, but I miss the apps from Android.

You can still throw your iPhone as high as you can for fun

It is just funny that such an app is how you distinguish the ecosystems

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Or have ads.

And that portion of quality apps depends on the fraction of good developers and designers who need or want to pay their bills from app sales revenue. Apps from rich kids, students on full-ride scholarships, company's with padded marketing budgets and such who don't need the income maybe won't have to cost.

Yeah but all usage and ad metrics show much greater use for IOS. It is not like android developers are secretly raking in a ton of ad revenue.

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Hah, no, that'd be you actually. OP is completely right. This is all bad news for Apple. Last year apple had over 70 percent of the smartphone market's profits, this year it's down to like 54 percent which is a staggering drop.

For a long time Apple was losing market share but still killing it on profits, now it's barely hanging on in terms of profits, has been totally blown out of the water in market share and now the same trend is showing in the App Store side of things.

I love my iPhone but you need to quit drinking the kool aide. Apple is in trouble.

Lol wut

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Every time I read about "BUT THEYRE ONLY SHIPPED NUMBERS" I picture the poster imagining this warehouse filled with Android devices, collecting dust while every time an iPhone made it's magically built at the time of the request.

Apple reports sold units. Many of their competitors report shipped units. So while you attempt to malign those who make such a distinction you come across ignorant.

 

[4TheLoveOfTech]

I clearly remember Microsoft taking over. I personally think Apple grew too big too fast. I don't think any company can sustain the record growth that Apple has exhibited the past few years. And during a worldwide economical slump to boot

At a certain point, there is nowhere to go except down. But how much? Why can't Apple be a niche player, albeit on a larger scale than they were in the past? Microsoft has fallen from the throne, but they certainly aren't going anywhere either.

Also. even as Apple's market share diminishes, we are still talking over 100 million i devices per year. Unless that falls to minimal numbers, I don't think that developers are going to jump ship. I see your point, if this trend continues for 5 years and the total number of iOS devices dwindles then developers will jump ship.

I think it's fairly well known here that I am not a defender of Apple the corporation.

I know for a fact you're a person that is neither a defender or apologist for Apple based on your posting history.

Apple can be a niche player as they were in the 80's. There is no indication that they won't be but likely won't be in the situation for a few years at minimum given a worse case scenario (they have a lot of stores that require a lot of money to maintain).

You posted that Microsoft has fallen from the throne but as far as the numbers that I read they still have the PC market share by a very large margin, Apple can't say that for any product with the exception of the iPod which has been decreasing in sales since the introduction of the iPhone.

How long will it takes depends purely on Apple in my opinion. If they continue to put out the minimum spec bumps with no new market changing iProduct then I think it will happen as quickly as Nokia and RIM. In 2007 RIM had 44% of the mobile arena and Palm had fallen to 24%. Apple is at or below both those percentage basis in their product line.

Tim Cooks current goal is to get more sales to go to the Apple store and not their current vendors. As a vendor how likely are you going to be to sign a new contract with guaranteed minimum purchases as Verizon has and got bit with what might be 18 billion in unsold iPhones for 2013?

It boggles my mind sometime reading Apple forums and the denial factor of what is happening and has been happening to the overall worldwide market share in any given Apple product.

I read Apple forums because a large part of my job requires that I stay current with all platforms to make responsible profitable decisions for the company I work for and for my customers. I have to stay current or I will be replaced if I miss my numbers for 2 quarters (and if not replaced my commissions will go down drastically). No Person or any company including Samsung and Google aren't replaceable. At this point with Microsofts hold on the business market they will be in the arena for a long time regardless of their last earnings report.

my 2 cents.

 

[AppleScruff1]

I know for a fact you're a person that is neither a defender or apologist for Apple based on your posting history.

Apple can be a niche player as they were in the 80's. There is no indication that they won't be but likely won't be in the situation for a few years at minimum given a worse case scenario (they have a lot of stores that require a lot of money to maintain).

You posted that Microsoft has fallen from the throne but as far as the numbers that I read they still have the PC market share by a very large margin, Apple can't say that for any product with the exception of the iPod which has been decreasing in sales since the introduction of the iPhone.

How long will it takes depends purely on Apple in my opinion. If they continue to put out the minimum spec bumps with no new market changing iProduct then I think it will happen as quickly as Nokia and RIM. In 2007 RIM had 44% of the mobile arena and Palm had fallen to 24%. Apple is at or below both those percentage basis in their product line.

Tim Cooks current goal is to get more sales to go to the Apple store and not their current vendors. As a vendor how likely are you going to be to sign a new contract with guaranteed minimum purchases as Verizon has and got bit with what might be 18 billion in unsold iPhones for 2013?

It boggles my mind sometime reading Apple forums and the denial factor of what is happening and has been happening to the overall worldwide market share in any given Apple product.

I read Apple forums because a large part of my job requires that I stay current with all platforms to make responsible profitable decisions for the company I work for and for my customers. I have to stay current or I will be replaced if I miss my numbers for 2 quarters (and if not replaced my commissions will go down drastically). No Person or any company including Samsung and Google aren't replaceable. At this point with Microsofts hold on the business market they will be in the arena for a long time regardless of their last earnings report.

my 2 cents.

Regarding Microsoft, I meant that at one time they were the most valuable company on earth, just as Apple once was. They do have the pc market by a huge margin, and that hasn't gone down much over the years. They have definitely met resistance with Windows 8, but time will tell on that. They are late to the game in the mobile computing market. Android may be the Windows of the mobile market, it certainly looks that way so far. Windows Phone 8 is a good mobile platform, but it looks like it will be a niche player next to Android. Perhaps over the next several years it will catch up to iOS as it's share increases while iOS decreases. Agreed, Microsoft isn't going anywhere, the business world runs on Microsoft products.

One big difference, IMO between Apple and RIM is the blind loyalty of so many of the users. People are quite enamored with Apple in a way that isn't "normal" to be so with a corporation. Apple is "cool" right now. Granted, things do change over time, but if Apple comes up with something groundbreaking in the next year or so, who knows?

I agree with the denial on Apple forums. As a consumer, I can't believe the things that people post here. Can you imagine anyone bragging about how much profit their power company made? Or defending everything the company does as if defending their own child? That part of it makes no sense to me at all.

 

[moxin]

App store will remain number.1 for so many other reasons also.

 

[AppleScruff1]

App store will remain number.1 for so many other reasons also.

What other reasons?

 

[Gus Van Der Mee]

I don't know. I have gotten six or seven weeks of daily candy crush play and think I have spent five dollars. I just spent another dollar after taking two weeks to get past one trying level.

I don't consider it a rip off. The first 30-35 levels are entirely free.

I actually appreciate the pay as you go model. Instead of paying 20 dollars upfront and never playing much of the game, I pay for the game as i advance and use it. Each additional 15 levels is 99 cents. That is 6.5 cents per level. Some levels take me twenty minutes and some take two weeks.

I used to be an old curmudgeon when it comes to in app purchases but this the the future for almost all games on all platforms. Mmorpgs used to have monthly subs , now almost all but World of Warcraft are free to play and you pay for extra content.

People think this is just a better model for game makers and it is not. Consumers can now try most games for free before spending any money. Then they can spend as they go and only spend for things they want.

Sure it allows some players to pay much more but that is their decision. It also allows others to pay much less.

As for Candy Crush their model works well and it is really not expensive at all given the amount of enjoyment one gets from it.

People who write off all in app purchase games will have few choices in the future.

Good for you. In my opinion in-app purchases is single worst thing Apple has done to it's ecosystem. Maybe it's great for developers and Apple, but for me not so much. I only recognize in-app purchases for more game content like maps and extra quests and map data in navigation apps for example. Also things like newspaper subscriptions.

 

[subsonix]

Good for you. In my opinion in-app purchases is single worst thing Apple has done to it's ecosystem. Maybe it's great for developers and Apple, but for me not so much. I only recognize in-app purchases for more game content like maps and extra quests and map data in navigation apps for example. Also things like newspaper subscriptions.

Blame the developers that choose to implement it in such a way, it's likely the unfortunate result of people's unwillingness to pay for software.

 

[haruhiko]

Sites like MacRumors, 9to5mac, theverge and engadget really don't want to face the facts. Everyday that goes by Apple loses something. I still remember when I wanted a iPhone on Verizon and iPad had like over 80% of the tablet market. Those days are gone. Even if Apple has successful launches with the iPhone 5s, iPad 5 and iPad mini 2 how long do you think it will last? I will bet anyone that iPhone 5s will become boring after the holiday's. Once the mini receives the retina display what's left? Once Apple releases a slightly larger iPhone 6 what's left. It all the same old products getting sequels.
I doubt an iWatch or Apple tv will save Apple.

What's so different for Apple's competitors? They are facing the same problem. New product categories (that everybody loves and uses) just don't come around every year.

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Blame the developers that choose to implement it in such a way, it's likely the unfortunate result of people's unwillingness to pay for software.

I remember Apple didn't allow in-app purchase (before it did, of course), and once said free apps must be free with no strings attached.

 

[Solomani]

I have to say, all my friends that use android don't pay for their apps since it's so easy to sideload cracked apps. why pay?

Then I hope that all your friends enjoy the rampant piracy and malware, as well as the advertising-driven third-rate ecosystem which continues to disappoint app developers!

 

[Solomani]

Good for you. In my opinion in-app purchases is single worst thing Apple has done to it's ecosystem. Maybe it's great for developers and Apple, but for me not so much. I only recognize in-app purchases for more game content like maps and extra quests and map data in navigation apps for example. Also things like newspaper subscriptions.

IAP model continues to succeed and make $$$$ for developers BECAUSE tons of people download and purchase the IAP.

If the majority of users really hated and avoided IAPs, then those IAP-based apps would have become extinct many months ago.

It's supply and demand economics. The underlying blame goes to the consumers. They vote with their pockets. And the vote is to continue supporting the IAP model. No one is forcing them.

 

[Oletros]

Then I hope that all your friends enjoy the rampant piracy and malware, as well as the advertising-driven third-rate ecosystem which continues to disappoint app developers!

More hyperbole?

 

[subsonix]

More hyperbole?

He has a good point.

 

[Macneck]

IMO, it was crazy to think that the stock was going to continue to go up $100 per month forever.

Totally agree. Actually, more than crazy, I'd say absurd. But I've noticed there are lots of daydreamers around the apple tree.

As a consumer, I could care less how much profit they make or what their market share is as long as they continue to turn out good products and are able to support them as they currently do. And I have no doubt that they will have new products in the future, it's just not going to be a new market segment created every year, and nor was it in the past.

Indeed. Support makes a big difference. I want the company I trusted to "take care of me". Selling is not the hardest thing, but keeping customers satisfied over the years. I am a customer, not an investor, therefore I need reliable tools and quality support. You give me that, I will trust you and work with you forever and many others like me. That is what should have an effect on Apple stocks and not the other way round.

 

[Macneck]

Those days are gone. Even if Apple has successful launches with the iPhone 5s, iPad 5 and iPad mini 2 how long do you think it will last? I will bet anyone that iPhone 5s will become boring after the holiday's. Once the mini receives the retina display what's left? Once Apple releases a slightly larger iPhone 6 what's left. It all the same old products getting sequels.

I don't see it quite like that. I see it more like you create something new that works very well. Others always follow. If they manage to make it reasonably well, they start taking bigger and bigger parts of the cake. It's normal. But you were the leader. That's prestige. They don't innovate, they don't open new tracks. They follow. While Apple keeps on leading -easier said than done!- the others will continue to follow... and they WILL follow. But if you give up opening new tracks and stay on the one you opened years ago, you give them the chance to lead. You lose your prestige and become just one more. That is only up to you.

I believe Apple must be making huge efforts to continue innovating, but they may be also scared to make mistakes (iWatch?)... There is were geniuses are most needed, were IMO Jobs is most missed.

I doubt an iWatch or Apple tv will save Apple.

Agree. IF they were to be saved, it would not happen with those two for sure.

 

[BaldiMac]

Q3 2012 saw the iPhone 5 with Apple's share of the profit in the mobile phone segment of around 75 percent. Right now it's sitting at like 53 percent.

That's a huge problem.

Not necessarily. It just means that others are also being successful.

 

[BaldiMac]

How can you make the same amount of money when your losing customers?

There's the crazy leap that people keep making when the claim to be basing their argument on trends! Apple isn't losing customers.

How are these trends going to look when we start comparing Apple's year over year growth to "disappointing" FY2013 instead of the uber-successful FY2012?