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January 09, 2013

Apps Don't Pull Much Revenue for Developers

By Colleen Lynch, TMCnet Contributor

With the popularity of some apps, developers should be making a fortune, right? Well, Apple (News - Alert) has decided to calculate and release the actual answer, and it seems the average app download makes approximately 17.5 cents for its developers. Now, multiply that by the average lifetime of an app, and you get some pretty unimpressive numbers.

Apple’s announcement included some other interesting numbers concerning apps and the app industry, such as the fact that over 40 billion apps have been downloaded by Apple’s customers, with half of them (20 billion) downloaded in 2012 alone.

Additionally, the App Store has 500 million active accounts at the moment (and growing) and broke records last month with over two billion downloads in just the month of December. 

Image via Shutterstock

For developers, the report was equally impressive: Apple’s developer community has created over 775,000 apps for the iPhone (News - Alert) and other Apple devices--but what have they earned for all this work?

According to Apple, its developers have been paid over seven billion dollars by Apple, not including other partners or investors involved in any of the individual apps.

The previously reported haul for individual apps was set at 16 cents per download, so 17.5 isn’t a huge hike, and even more significant is the fact that over an app’s lifetime, if 17.5 cents is the correct average, an app will make $9,000.

Seem low? That’s because it is, and what’s more, because most apps are not hugely successful (or even remotely so), the majority of apps earn much, much less than these reported numbers. The averages get skewed because of the vast difference between the numbers reported by the most popular apps, which can pull in tens of millions, and the virtually unknown ones.

What Apple isn’t saying here, then, is that any sane person should not get into the app writing business. You can’t really blame them though--why would the company say that?

To get apps made, there has to be that illusion you could make millions, regardless of the reality of the numbers.

In reality, app developers are losing money, and most investments made in apps are not made back for investors.

Want to learn more about the latest in communications and technology? Then be sure to attend ITEXPO Miami 2013, Jan 29- Feb. 1 in Miami, Florida.  Stay in touch with everything happening at ITEXPO (News - Alert). Follow us on Twitter.

Edited by Brooke Neuman
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