Trying to Get Rich Off the iPhone? It May be Harder Than You Think!

Trying to get rich by developing an iPhone app is harder then you think, according to data collected by Pinch Media.

Greg Yardley, CEO of Pinch Media, notes that the influx of funds from paid applications is highly skewed to a relatively small amount of developers.

Their analysis has found that the average paid app performs as follows:
- 9,300 downloads (vs. average free app downloads: ~71,000)
- $12,100 revenue (net to developer: ~$8,500)


Even these results are very misleading. Yardley indicates that App Store sales and distribution are ‘top-heavy’ meaning that the most popular applications receive a very disproportionate amount of sales.

The chart below shows that the top 10% of paid apps get about 75,000 downloads; whereas, the next 10% sees only about 9,000 downloads. It keeps dropping drastically after that with the next 10% seeing less then 4,000 downloads and so on. Half of all paid apps are downloaded less than 1,000 times.

This means that if you develop an application and you can't break the top 10% of the 77,000 available paid apps you basically make squat. If your app is sold at $.99 and you make it to the top 20% you would earn $6,300 from Apple. If you make it to the middle of the pack you would earn $834. Not very encouraging.


Interestingly, Pinch Media also notes that within the $.99 to $4.99 range, price is not a factor. This is likely because of the psychological barrier to buying an app. Once you have decided to break that barrier and buy, the extra couple bucks between $.99 and $4.99 is almost negligible. As we go higher the average downloads does drop in half from $4.99 to $9.99.


Read More [via InfoWorld]