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App Store Market Worth Nearly $2.5 Billion Per Year?

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Mobile advertising firm AdMob has released its July 2009 Mobile Metrics report along with a supplemental presentation in which the company reveals the results of a survey of over 1,100 iPhone, iPod touch, and Android users to obtain data on application usage. The study reveals that iPhone users download approximately 10 applications per month on average with 25% of those being paid applications. iPod touch users download over 18 applications per month on average, with only two of those being paid applications.




The study also found that approximately 50% of iPhone users download at least one paid application per month, while only 40% of iPod touch users do likewise. Users who do download paid applications average approximately five paid downloads per month and spend an average of $9.49 (iPhone) or $9.79 (iPod touch) per month for an average application price of just under $2.00.

Extrapolating the survey data to the estimated user bases of 26.4 million iPhone users and 18.6 million iPod touch users, AdMob suggests that the total App Store market size may be nearly $200 million per month, or approaching $2.5 billion per year. In contrast, the Android market is estimated at approximately $60 million per year.




AdMob's survey method of soliciting respondents via ads within its own network, which serves 7,000 mobile web sites and 3,000 applications, may skew the survey results somewhat by attracting users more likely to be engaged in mobile applications, but the results do still provide an idea of the substantial market for App Store developers and Apple itself.

Article Link: App Store Market Worth Nearly $2.5 Billion Per Year?
 

DTphonehome

macrumors 68000
Apr 4, 2003
1,794
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NYC
Wirelessly posted (Mozilla/5.0 (iPhone; U; CPU iPhone OS 3_0_1 like Mac OS X; en-us) AppleWebKit/528.18 (KHTML, like Gecko) Version/4.0 Mobile/7A400 Safari/528.16)

60m vs 2.5b. Whoa.
 
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Full of Win

macrumors 68030
Nov 22, 2007
2,615
1
Ask Apple
Take home: Touch users are cheapskates.

iPhone free to pay ratio: 2.9 free to every pay app
iPod Touch free to pay ratio: 8.2 free to every pay app

...or the average iPhone user buy ~ 3X as many apps then does the average iPod Touch user.
 
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talkingfuture

macrumors 65816
Dec 4, 2008
1,216
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The back of beyond.
Wow, thats a heck of a big market thats grown very quickly. I wish I had the programming talent to get in on the App business. Looks like I'll just have to stick to consuming.
 
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imgonephishin

macrumors regular
Jan 3, 2003
141
0
Take home: Touch users are cheapskates.

Yeah, I thought that was interesting. Only 2 of 18 apps are paid for Touch users.

I must be in a tiny minority, but very few of the apps I download are free. The vast majority are .99 to 2.99. Mostly, I've just found I don't feel like wasting my time with lame, crippleware "lite" or "free" games. I'd rather just read the reviews and drop a buck on the ones that sound good.

By my estimates, I probably download 10 apps a month. 7 or 8 will be paid and I'm probably around $10-15/month total.
 
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2pacy

macrumors newbie
Dec 18, 2008
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0
I don't know how AdMob can dare to provide such data, if they don't have a simple system to target ads properly.

Try an put 50$ on AdMob, they'll last 10 minutes, if they last.

If you put a CPC of 50 cents, is the same than if you put a CPC of 5 cents, and the best of all, it doesn't makes any difference.

ROI = 0 after spending more than 500$ worth which went in less than an hour with no conversions.
 
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creon

macrumors 6502
Mar 19, 2009
317
0
Shareholders must be happy! The app business has really opened up a whole new market share for apple. The app store has made the iPhone the success it was been and now it is reaping its rewards.
 
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macduke

macrumors G4
Jun 27, 2007
11,311
15,348
Central U.S.
The other factor that would skew their results: if my device was one of the ones surveyed. I'm an appoholic of sorts. I'm sure I download well over 100 per month, though many are free or 99 cents. I usually watch for the sales. Of course I have to delete a lot of crap, but right now I only have one free spot left for an app. I need to do some cleaning...

I wish they could post the list of most used apps, although that would be limited to their partners, and there could be user backlash as a result.
 
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Tilpots

macrumors 601
Apr 19, 2006
4,192
71
Carolina Beach, NC
Which makes more $ for apple, the App store or the iTunes store, based on these estimates?

Profitability, I'd have to think it's the App store...
 
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hhaeschen

macrumors regular
Jan 1, 2008
102
0
EU
spend an average of $9.49 (iPhone) or $9.79 (iPod touch) per month

I seriously wonder what's there to spend $9.49 on. Every month. I have trouble finding apps in the appstore that are worth to pay for. It's not that I am cheap or unwilling to pay, I just don't see many high quality apps.
There are some very few exceptions, but obviously I buy those apps just once, not every month.
 
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zombitronic

macrumors 65816
Feb 9, 2007
1,115
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I'm not sure what "worth $2.5 billion" actually refers to. Total revenue? If so, because Apple gets 30% of every paid app, that's a yearly profit of $750 million. The other $1.75 billion goes to developers.
 
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P-Worm

macrumors 68020
Jul 16, 2002
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Salt Lake City, UT
You know, it makes a lot of sense to me that less iPod Touch owners download applications frequently. My brother is a good example. My brother is 13 and has an iPod Touch. Our family wouldn't consider getting him an iPhone because what he would do with it wouldn't justify the monthly fee attached to it. My brother spends a big part of his day downloading free applications off the App Store so he can play some games to pass the time. He's bought an occasional game, but he mostly sticks to free applications simply because he doesn't have money to freely spend.

I think you will find that iPod Touch users tend to be younger and dependent on others for income whereas iPhone users are more independent economically. Of course, I have no data to back this up, but it makes sense to me.

As an aside, I use an iPod Touch instead of an iPhone and download very few applications. But that's just because I'm a cheapskate. :D

P-Worm
 
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Droid13

macrumors regular
Jul 22, 2009
196
0
United Kingdom
Not bad, not bad...

Hugely extrapolated but nevertheless, the figures are going to be big. As an iPhone user I personally have actually averaged a paid app a week, most of my buying being done in the first week of ownership - I knew what I needed and went and got it.

What I hope is that figures like this make Apple realise how valuable the App Store is as an asset and that they devote more resources to it - having more testers, more thorough testing, a clear, transparent and detailed app approval process and so on.

I would also hope that they came up with a way for making it easier to find apps that are really good, since I have to look up about 20 apps before I find the one that probably suits me best, and even then I don't know. Review sites help somewhat, but they can't review every app...
 
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hhaeschen

macrumors regular
Jan 1, 2008
102
0
EU
THIS PROVES that Apple needs a better organizational method on the iPhone/iPod. So in a year, the average person has downloaded 100-200 apps. Granted some suck and are deleted, but you still should be able to create folders like "Games."

Swipe - Swipe - Swipe - Swipe - Swipe - Found it! - Isn't very Apple-like or easy.

You are aware that you can start an app with the Spotlight feature introduced in OS3.0?
 
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hiimamac

macrumors 6502a
Jun 7, 2007
610
0
Boston
Funny how they don't mention the grey market which accounts for 33.3 percent, or so I read. No DUG that the iPod would d/l more, hello, they can't call anyone, I mean, really, HELLO, rather, they can't do that. LOL.

I wonder if Jail Broken Touches can make calls? If there is a mic, then yes. LOL.

Just having some fun guys,

LOL.
 
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nkawtg72

macrumors 6502
Aug 16, 2007
308
0
You know, it makes a lot of sense to me that less iPod Touch owners download applications frequently. My brother is a good example. My brother is 13 and has an iPod Touch. Our family wouldn't consider getting him an iPhone because what he would do with it wouldn't justify the monthly fee attached to it. My brother spends a big part of his day downloading free applications off the App Store so he can play some games to pass the time. He's bought an occasional game, but he mostly sticks to free applications simply because he doesn't have money to freely spend.

I think you will find that iPod Touch users tend to be younger and dependent on others for income whereas iPhone users are more independent economically. Of course, I have no data to back this up, but it makes sense to me.

that's logical reasoning to me
 
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nkawtg72

macrumors 6502
Aug 16, 2007
308
0
I'm not sure what "worth $2.5 billion" actually refers to. Total revenue? If so, because Apple gets 30% of every paid app, that's a yearly profit of $750 million. The other $1.75 billion goes to developers.

not trying to be picky or critical, but you're mixing the words Profit and Revenue together there. apple would get 30% but that's not necessarily profit.

i don't know from personal experience, only what i've read experts and apple to say, and that is that apple pretty much breaks even on the app store as well as ITMS. has anyone heard different lately?
 
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mkrishnan

Moderator emeritus
Jan 9, 2004
29,776
12
Grand Rapids, MI, USA
It's impressive just from the economic productivity generated in such a short time... particularly amidst a global downturn. Nice work!

The iPhone/iPod thing is interesting... they spend similar amounts of money but the iPhone users download a lot less apps. I guess I don't download that many apps, but I'd also guess my monthly spend is less -- probably more like $3-5 than $10. I'm more time limited than anything. Almost all the money I spend is on games, with Airmouse being one of the few exceptions (well worth it, though!), and I just don't have the interest to metabolize multiple games per month anymore. :eek:

Also the statistics I think are interesting, because even if we have a model of the average iPod touch user being 15 years old and having 8 pages of apps on their phone (and $4 in their pocket), those demographics aren't necessarily true. Spread out over the vast majority of adult iPhone users in particular, the amount of commerce the app store does is pretty great.
 
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