Become a MacRumors Supporter for $25/year with no ads, private forums, and more!

MacRumors

macrumors bot
Original poster
Apr 12, 2001
56,964
19,799


The App Store ecosystem facilitated an estimated $643 billion in billings and sales in 2020, an increase of 24 percent year-over-year, according to an Apple-commissioned study done by Analysis Group economists. [PDF]

app-store-blue-banner.jpg

The study, "A Global Perspective on the Apple App Store Ecosystem," comes as Apple awaits a decision in its ongoing trial with Epic Games, much of which focused on App Store policies and fees. Epic Games and other developers have been unhappy with Apple's 30 percent cut, with Epic Games lobbying for alternative app store options while Apple fights to prove the value of the App Store as it exists now.

Analysis Group's research looked at how the App Store ecosystem shifted amid the pandemic in 2020, highlighting the ways Apple's platform helped small developers (those with less than one million downloads and less than $1 million in earnings), as well as exploring how the App Store has benefitted developers over the course of the last five years.

app-store-ecosystem-sales-increase.png

The $643 billion total estimate for 2020 takes into account various app monetization strategies, and 90 percent of the $643 billion comes from sales outside of the App Store, which Apple says it collected no commission on. These sales include general retail, travel, food delivery and pickup, ride hailing, and grocery store orders, with physical goods and services representing the biggest category. Basically, when you shop in an app, purchase food delivery, or order a Lyft ride on your iPhone, the study counts that as commerce facilitated by the App Store.

app-store-estimated-billings-2020.png

Analysis Group suggests that sales enabled by the App Store increased by $124 billion compared to 2019, marking 24 percent growth. Much of this growth came as people shifted to staying inside and doing more business online because of the pandemic. Billings and sales of digital goods and services was up 40 percent, for example, while sales in the travel and ride hailing sectors were down more than 30 percent.

According to the study, small developers make up 90 percent of all App Store developers, and more than 1 in 4 small developers that sell digital goods and services on the App Store have increased their earnings by an average of 25 percent each year for the past five years, including 2020. The number of small developers has has increased 40 percent between 2015 and 2020, and earnings have nearly tripled between 2015 and 2020.

Almost 80 percent of small developers are active across multiple countries' storefronts and have earnings from users in more than 40 countries, with Apple pointing out how the App Store facilitates secure international transactions, localized storefronts, and payment processing. 40 percent of app downloads from small developers came from users outside of the developers' home countries, and nearly 80 percent of small developers are active in multiple storefronts.

As for larger developers, a conservative estimate suggests that more than 75 app-based companies in the U.S. and Europe have gone public or been acquired, with a total valuation of more than $510 billion at the time of their offering or sale. Apple says that these are all companies for whom iOS apps are central to their businesses. Dating app Bumble, for example, started out on the iPhone in 2014 and IPO'd in 2021, raising $2.2 billion.

In the announcement highlighting the study, Apple also pointed out that it helps developers create apps with more than 250,000 APIs in 40 software development kits (SDKs), as well as helping budding developers with Developer Academies and other app development courses and educational offerings. Apple says more than 10,000 people have graduated from a Developer Academy and have launched more than 1,500 apps, and its educational efforts reached more than two million students and teachers in 2020.

Apple CEO Tim Cook said in a statement that the App Store brings jobs, opportunity, and "untold innovation."
Developers on the App Store prove every day that there is no more innovative, resilient or dynamic marketplace on earth than the app economy. The apps we've relied on through the pandemic have been life-changing in so many ways -- from groceries delivered to our homes, to teaching tools for parents and educators, to an imaginative and ever-expanding universe of games and entertainment. The result isn't just incredible apps for users: it's jobs, it's opportunity, and it's untold innovation that will power global economies for many years to come.
Apple's full Newsroom article has additional detail on the study as well as anecdotes from developers on how various App Store features and functions have helped them grow their businesses, and the full study is also available in PDF format.

Apple previously worked with Analysis Group on a study that demonstrated how similar Apple's App Store fees and practices are to those of other digital marketplaces like the Amazon Appstore and the Google Play app. That study, published in July 2020, came ahead of when Apple CEO Tim Cook testified in an App Store antitrust hearing.

Article Link: App Store Ecosystem Responsible for Estimated $643 Billion in Billings and Sales in 2020, According to Apple-Commissioned Study
 

Duane Martin

macrumors 6502a
Oct 15, 2004
529
1,190
Calgary, Alberta
Compelling argument in favour of the App Store and the benefits. Now looking for the argument as to how opening alternate store fronts would damage this. Do not get me wrong, as a developer I appreciate the opportunity that the App Store provides but others are convinced there is a better way. I want to know more from both sides.

In the end I highly doubt I would benefit either as a consumer or developer by opening things up but I am not close minded on the subject.
 
  • Like
Reactions: xander49x

Cosmosent

macrumors 68020
Apr 20, 2016
2,315
2,690
La Jolla, CA
Will continue to press AAPL on disclosing some "real" data:

I'm in favor of New Law that would require Apple to disclose per-Category Revenue Numbers for (at least) the iOS App Store here in the States, & require them to do so at the end of each work week.

Also, that the per-week per-Category Reports should include what percentage was generated by the Top 10 Apps in each category, as well as what percentage of apps in each category generated NO revenue.

So, three columns of data per Category, reported by Apple every week.


IMO, it's just a matter of when / NOT if !
 
  • Disagree
Reactions: mw360 and xander49x

Cosmosent

macrumors 68020
Apr 20, 2016
2,315
2,690
La Jolla, CA
Compelling argument in favour of the App Store and the benefits. Now looking for the argument as to how opening alternate store fronts would damage this. Do not get me wrong, as a developer I appreciate the opportunity that the App Store provides but others are convinced there is a better way. I want to know more from both sides.

In the end I highly doubt I would benefit either as a consumer or developer by opening things up but I am not close minded on the subject.

Specifically, "App Discovery" App Stores that would compete with AAPL head-on in App Discovery, & would receive a portion of AAPL's cut for their success !

And specifically, ONLY for the NON-Game portion of the App Store.

Under this scenario, even AAPL wins, as the NON-Game portion of their App Store doesn't work well, & that's an UNDER-statement !
 

Realityck

macrumors 601
Nov 9, 2015
4,417
6,074
Silicon Valley, CA
Thats a staggering amount of commerce that goes through Apple. Still only 10% of that is attributed to sales linked to the Apple App store.
The $643 billion total estimate for 2020 takes into account various app monetization strategies, and 90 percent of the $643 billion comes from sales outside of the App Store, which Apple says it collected no commission on.
 

farewelwilliams

Suspended
Jun 18, 2014
4,966
18,037
next time anyone on this forum tells you that it’s unfair for Apple to force IAP, show them this figure

The $643 billion total estimate for 2020 takes into account various app monetization strategies, and 90 percent of the $643 billion comes from sales outside of the App Store, which Apple says it collected no commission on.
 

Naraxus

macrumors 65832
Oct 13, 2016
1,504
6,640
Agreed. I bought into iOS for a reason. I knew what I was getting into. If I wanted something more open I would have bought an Android device.
Please inform the class that if multiple payment options/app stores were available how it would affect you if you didn't use them?
 

cygy2k

macrumors member
Jun 13, 2005
90
167
Will continue to press AAPL on disclosing some "real" data:

I'm in favor of New Law that would require Apple to disclose per-Category Revenue Numbers for (at least) the iOS App Store here in the States, & require them to do so at the end of each work week.

Also, that the per-week per-Category Reports should include what percentage was generated by the Top 10 Apps in each category, as well as what percentage of apps in each category generated NO revenue.

So, three columns of data per Category, reported by Apple every week.


IMO, it's just a matter of when / NOT if !

So why should Apple have to do basically weekly revenue reporting but no other company or industry has to? If you want to foster competition, then have competition worth going to, don’t over tax and punish the company that has found a way to do things well.
 

MauiPa

macrumors 68030
Apr 18, 2018
2,956
4,316
Will continue to press AAPL on disclosing some "real" data:

I'm in favor of New Law that would require Apple to disclose per-Category Revenue Numbers for (at least) the iOS App Store here in the States, & require them to do so at the end of each work week.

Also, that the per-week per-Category Reports should include what percentage was generated by the Top 10 Apps in each category, as well as what percentage of apps in each category generated NO revenue.

So, three columns of data per Category, reported by Apple every week.


IMO, it's just a matter of when / NOT if !
seriously, you want big government? And what would be the purpose of said law, what would be the legal underpinning to support said law? It seems it would last about 5 minutes before it was found to have no merit. and does it apply to amazon, Google, Facebook, Sears, Macy's, Walmart?
 
  • Like
Reactions: xander49x

MauiPa

macrumors 68030
Apr 18, 2018
2,956
4,316
Can't apple ask their accountants instead of hiring someone to do this study?
What are you getting at? I'm sure they could hire some economists (not accountants) to study the issue but 1) that is not their core business so it is a perfect fit to hire consultants, 2) credibility - the external firm would not be willing to tarnish the results and win their reputation, 3) experience, these are classic economic impact studies, that consulting firms do
 
  • Like
Reactions: xander49x

MauiPa

macrumors 68030
Apr 18, 2018
2,956
4,316
Please inform the class that if multiple payment options/app stores were available how it would affect you if you didn't use them?
Please inform the class that multiple payment options are available. If any developer wants to have their own subscription model and an outside billing and payment processing service, they may do so. Like brick and mortar stores, they are simply prohibited from advertising and steering from within the store, but they can advertise all they want outside of the store. and, like epic, they can sell vbucks till the cows come home and not pay apple anything.

At least get your story right
 

MauiPa

macrumors 68030
Apr 18, 2018
2,956
4,316
Specifically, "App Discovery" App Stores that would compete with AAPL head-on in App Discovery, & would receive a portion of AAPL's cut for their success !

And specifically, ONLY for the NON-Game portion of the App Store.

Under this scenario, even AAPL wins, as the NON-Game portion of their App Store doesn't work well, & that's an UNDER-statement !
Why would/should any business want to do that? If you think about it, you can do a duck-duck-go (not google, they track you) search for best yadayada app (even from an external aggregator or external App Store), if the developer had an outside payment model, you could sign up, then go to App Store and download for free. Kind of like Spotify. No one buys Spotify subscriptions on the App Store.

BOOM! another weak argument totally destroyed. Your welcome!
 
  • Haha
Reactions: xander49x

MauiPa

macrumors 68030
Apr 18, 2018
2,956
4,316
App Store does NOT sell physical goods, that's the vendor so by in-app purchases or fees really shouldn't be factored in.
so OK, you don't know what an economic impact study is. Gotcha. They are added in simply because this is measuring the economic impact effected via the App Store. Kind of like counting cars using a highway, it is just a volumetric understanding of the size of activity. Probably the more meaningful data is buried in the report itself which allows actual management of the issues associated with the store.
 

hanske68

macrumors member
Jan 21, 2020
82
76
You'd say they could spend some of that money on proper documentation and developer support, couldn't they?
 

tongxinshe

macrumors 65816
Feb 24, 2008
1,012
577
seriously, you want big government? And what would be the purpose of said law, what would be the legal underpinning to support said law? It seems it would last about 5 minutes before it was found to have no merit. and does it apply to amazon, Google, Facebook, Sears, Macy's, Walmart?
Of course it only applies to the companies that Cosmosent himself feels TOO RICH, no others.

Oh, wait, there are no Apple stock owners in the list of the most wealthy people, HMM...

Anyway, it doesn’t matter, the whole rule must follow personal perception of Cosmosent himself!
 

DeepIn2U

macrumors G4
May 30, 2002
11,210
5,429
Toronto, Ontario, Canada
Why would/should any business want to do that? If you think about it, you can do a duck-duck-go (not google, they track you) search for best yadayada app (even from an external aggregator or external App Store), if the developer had an outside payment model, you could sign up, then go to App Store and download for free. Kind of like Spotify. No one buys Spotify subscriptions on the App Store.

BOOM! another weak argument totally destroyed. Your welcome!

Still a 2 part process.
Still a concern of recurring charges if you
a) opt out.
- what rights does end user have if monthly subscription is cancelled mid month, do they still get honoured for the service paid for?
b) whom will handle payment or service arbitration, and how fair will it be?
c) whom will handle the refunds?
- kids on your PC, Linux/mac browser clicks register and payment, yet you did NOT intend to do this? how would this be handled?
- You didn't download the app in scenario "c" above, whom will properly refund you and detect that?
left ball points to right ball - telling YOU to do the work.
back and forth - just like the video card and driver issues of old (ATi vs etc days) when you custom build your PC. Motherboard manufacturers would ALWAYS point the finger and I'm guessing still does today. typical end users loathe deailing with stunts like this. How many third party vendors in your proposed 'solution of boom' are reputable to deal with this maturely and properly?

Vendor on website has their site hacked into ransomware or otherwise and their DB are purged including backups.
What's their record that you DID or did NOT pay? Hmm.
Still a concern when you switch phones:
- do you have to pay again for the software?
- do you have to pay for software again if vendor updates it when new iOS / Android is released and installed?
^ Tapbots on iOS has been doing this for YEARS! IT's annoying and downright RUDE but that's the creative owner and teams choice/right. I chose not to purchase it again since iOS7.

there is a LOT more to the scense here that I feeel Apple MISSED a HUGE opportunity on during the trial.
 

DeepIn2U

macrumors G4
May 30, 2002
11,210
5,429
Toronto, Ontario, Canada
Of course it only applies to the companies that Cosmosent himself feels TOO RICH, no others.

Oh, wait, there are no Apple stock owners in the list of the most wealthy people, HMM...

Anyway, it doesn’t matter, the whole rule must follow personal perception of Cosmosent himself!
That's because they have shell companies or legit business they DO have stock/shares in that DOES invest in Apple

Birkshire Hathaway, Ark Investments etc ... most of mutual funds and similar type business. +
 
Register on MacRumors! This sidebar will go away, and you'll see fewer ads.