Mobile apps still not the place to make money - Gartner

Interesting Links
#1

Gartner Says Less Than 0.01 Percent of Consumer Mobile Apps Will Be Considered a Financial Success by Their Developers Through 2018

“There are so many applications that are free and that will never directly generate revenue. Gartner is forecasting that, by 2017, 94.5 percent of downloads will be for free apps,” said Mr. Dulaney. “Furthermore, of paid applications, about 90 percent are downloaded less than 500 times per day and make less than $1,250 a day. This is only going to get worse in the future when there will be even greater competition, especially in successful markets.”

There are other stats and predictions in the article.

1 Like
#2

// cc @ian

7 Likes
#3

@andrey, that’s brilliant. I have even better advice:

JK Rowling is worth billions, she is richer than the Queen of UK. So we should all be quitting our jobs and writing books about little boys who find out they are secretly wizards.

2 Likes
#4

The odds didn’t look good, even back in 2010:

#5 
So we should all be quitting our jobs and writing books

Some do try this path. Take for instance this guy (DO NOT BUY! UTTER CRAP!):

http://www.amazon.com/Quest-Heroes-Book-Sorcerers-Ring-ebook/dp/B00AFROVQC

The guy tried to re-create the success of some of the fantasy world authors by producing volume after volume of unimaginative crap, while at the same time outsource the 5-star reviews.

I got caught into it, bought the book 1 (on kindle), read first 3-4 chapters, and gave it a 1-star review.

Is this business project (I cannot call it a literature) a failure? I don’t know, may be, if it is produced by some poor Indian guy, he’s got substantially richer now.

#6

For games, that was fixed by in-game payments, correct? I recently reviewed my annual expenses for my son’s phones/tablets games, and found that I allowed them to spend $198 onto a single game - Clash of Clans – not even mentioning all the other games.

Would I ever buy a single game at this price tag in a single transaction, even the big titles like my favourite Gears of War? NO WAY. But I did paid that for this little game because it was spread over a 1 year period.

Can business mobile apps use the same strategy? I don’t know, I’m not a mobile developer… but the logic say yes, at least some of them may and try it.

Business apps would have to provide the basic functionality for free, and all the really useful features as paid plugins or paid services (e.g. OCR could be a plugin and a service, with separate charging).

Let’s see what I have on my start screen:

  1. K9 email app. I would implement advanced sorting and filing as a plugin for extra price. Reply templates could be a plugin too.
  2. Pure calendar. Integration with tasks applications should be a plugin. Advanced filtering. Colors editor, may be.
  3. BeyondPod (podcast player). Pro options such as 2x playback. Adding notes to the playback with sharing to Dropbox/email. Suggestions such as “people who listen this podcast also listen to…”.
  4. Twitter. Hmm… I used to use twitter to familiarize myself with the current events in the IT. I see it as a plugin. (Though twitter do not need to make those small gains, of course).
  5. Firefox. Well, again, the wrong kind of app, but the ad blocker would worth the money.
  6. Sleep as Android: they are already using this model. I’m not very much into sleep tracking, so I did not buy anything yet.
  7. CamScanner: Extra export formats could be in plugins. OCR plugin (via a cloud service). Backup plugin(s). Encrypt plugin.

The reason it may work in mobile is that there is a ridiculously easy buying process - need a plugin? One click and you’ve paid and got it! I would not go into producing the large number of micro-plugins in say enterprise B2B.

#7

I have loads of games and utilities on my iPad. I have paid a total of perhaps $40 for the whole lot over several years. None of them are in-app purchases.

#8

That’s about the only thing I love about Microsoft and hate about Apple: the way they try to attract devs to their platforms.

Microsoft’s way: great developer tools, neat programming language/framework, training programs, partner programs, certification programs, local developer conferences and workshops in about every region of the world including Russia/Asia, open-sourcing the .NET platform (ugly attempt, but still) etc etc etc

Apple’s way: “Look, this kid just made a million dollars!!!”

#9

The ease of in-app purchases is a bit too easy, according to the EU: http://www.macworld.com/article/2455880/european-commission-slams-apple-for-in-app-purchase-policies.html

But the point about free/cheap apps being the thin end of the wedge for a $200 kids’ entertainment bill is a good one. I rarely purchase apps for myself but entertaining my kids provides me real value that I’m willing to pay for.

#10

The audience and expectations of value for mobile apps is so off kilter that you can’t make real money doing it anymore unless you are a unicorn.

The barriers to entry are too low and the volume of competition is too high. It’s like trying to stand out in the crowd at Woodstock.

Back when there were only a couple interesting apps, even less interesting ones were able to do well. Now, you have to put in a giant amount of work to build something really good and you still aren’t likely to get noticed.

1 Like
#11

Using Yo or any other single app as an example is misleading for sure, but are there other approaches that have the potential to work? I’m thinking here about approaching it as a numbers game a la Rovio (51 failures before Angry Birds) or how Nathan Barry’s marketing of OneVoice via traditional, non-App Store channels.

#12

Have Rovio has a success since Angry Birds?

1 Like
#13

Did they develop anything new after Angry Birds? I don’t think they have or need to :wink:

#14

Yes, and a pretty good stuff, though in the same “universe” (but that just pictures).

http://www.rovio.com/en/our-work/games/view/47/bad-piggies

I did not actually buy Angry Birds, but I did buy Bad Piggies.

#15

Interesting success story building a specialized app:
Pleco: Building a Business, not an App

"Make no mistake, Love has had his breaks, particularly his having started with favorable licensing terms, but I would ask every indie developer who is bemoaning his or her fate in the app store:

  • Are you serving a niche that has a clear need, an audience that is willing to pay, and that is large enough to sustain your app?
  • Have you developed sustainable differentiation that is more tangible
    than just look-and-feel?
  • Do you have a fully thought-out monetization model that lets you make
    a meaningful amount from every customer you serve? If your app is
    truly differentiated then you need to charge customers accordingly
  • Have you invested just as much if not more effort in non-development
    functions like making partnerships, licensing, promotion, etc.?
  • Have you made an Android app?

All of this is table stakes for any developer, indie or not, and as much as I like Sinclair personally, the lessons I draw from his experience is not that the app store is broken, but rather that he built a bad business (particularly in his choice of market). If doing everything I listed doesn’t sound attractive, or realistic, if all you want to do is develop and make something beautiful, then you need to get a job that will pay you to do that. To be an indie is to first and foremost be a businessperson, and what I admire about Love is that he is exactly that. His development skills are a mean, not an end."

1 Like
#16

Most smartphone users download zero apps per month
’Only about one-third of smartphone owners download any apps in an average month, with the bulk of those downloading one to three apps. The top 7% of smartphone owners account for “nearly half of all download activity in a given month,” comScore reports.’

Article also has other interesting statistics from the comScore report.

#17

“The human race has reached peak entitlement, and it’s all the App Store’s fault.” The latest reminder that B2C mobile apps are not the best apps to develop. Plus, one can only hope we’ve reached peak entitlement.

3 Likes
#18

“The App Store has also undoubtedly made life easier for independent developers.”

Not for me, it hasn’t!

#19

@Andy, what is your experience with the various app stores, or your decision process to not put your Home version on them? The Windows/Mac ones don’t seem to have a lot of competition for your seating planner.

#20

I started the process of trying to get a link to PerfectTablePlan into the Windows app store. But it was such a shambles, I just couldn’t be arsed to complete the process. Looking at the Windows app store now, I don’t regret that decision.

I also haven’t bothered with the Mac app store. There are just too many negatives.
-30% fee
-downward pressure on prices
-no direct access to customers
-no paid upgrades
-poor discoverability for niche apps like mine
-being subject to Apple’s every whim
-requirements such as sandboxing that might be quite difficult to retrofit, especially for a cross-platform app (haven’t seriously researched it)