App Mania: The Big Business of Downloads

In case anyone wasn’t counting, Apple’s App Store now has more than 100,000 applications. According to the press release, Apple (AAPL) has seen more than 2 billion downloads of those apps; my estimate is that that number is now about 2.4 billion worldwide. As we noted in our September report, Forecasting the Mobile App Gold Rush, we expect the U.S. will account for about 1 billion of those downloads in 2009; the rest come from around the world (and from 2008; Apple counts its app downloads since it launched its App Store in July 2008).

What’s behind all this app mania at the Apps Store? Well, for one thing, it’s not just iPhones driving this boom; iPod touch owners can run the same apps on their platform, and there are more than 20 million of those worldwide. But mostly this trend is because Apple makes it really easy for customers to both download and buy these apps. According to data from the Yankee Group Anywhere Consumer: 2009 U.S. Survey Suite, smartphone owners as a group download an average of 4.5 apps over the past 90 days. For Apple iPhone owners, that number averages 9.8, the highest of any smart phone manufacturer. Mobile ad network owner AdMob claims even higher numbers than that for iPod touch owners.

As we noted in our report, downloadable apps are becoming a big business, but don’t expect Apple to be the only winner here. With Android-powered (GOOG) phones like Verizon’s (VZ) Droid and T-Mobile’s Cliq (both made by Motorola (MOT), I might add), we can expect to see a similar boom in Android apps. Competition will just make both companies raise their game, and the results are only good news for app-loving consumers.

Comments

[iJah420:]

And the AAPL is down 20pts +- over the past 2 weeks on FUD run articles on AAPL.

AAPL Long in a BIG WAY!!!! over $200 by end of November. $250 by mid to late 2010. Apple is going to have a STELLAR Christmas.

Nov 04 10:50 AM

[Mark Sigal:]

My personal belief at this point is that the 100K milestone is the point when Apple should shift tactics and focus on something more meaningful than mere quantity, as subsequent numbers become less and less meaningful, and we get it, "There's an App for That."

Otherwise, the 'magic' starts become clinical and cold, which is very un-Apple-like, something that I blogged about in:

iPhone’s 100K Apps is the New '7-Minute Abs'
bit.ly/rJkEC

Check it out, if interested.

Mark

Nov 04 05:01 PM

[brewer:]

", but don’t expect Apple to be the only winner here. With Android-powered (GOOG) phones like Verizon’s (VZ) Droid and T-Mobile’s Cliq (both made by Motorola (MOT), I might add), we can expect to see a similar boom in Android apps. "

Please tell me WHY I or anyone else should "expect" the same success from the wanna-be, copy-cats?!?

None of the usual PC "faithful" FUD meisters EXPECTED the app store to take off! But it DID.

Motorila

Nov 05 02:17 PM

[brewer:]

Moto+goog has nothing whatsoever on Apple.

Nov 05 02:17 PM

[Thomas J. G...:]

I actually did an itunes finance app and it was not what I expected. My thought going in was that the iphone was a platform where a person with a good idea could make some money off of software. I wasn't interested in doing something for free on the web and then figuring out how to make money on it. The wintel pc platform hasn't had any new paid software by independent developers in a long time. The iphone app store is now becoming just like the web. You have to offer the software for free or really cheap and find other ways to make money off it. Everything on the iphone app store is getting shoved towards offering the app for free and making money off advertising or in app purchases. Which is just what the web is.

Nov 06 11:55 AM

[Thomas J. G...:]

I want to be clear about my comments on the itunes app store. I have no beefs with apple, they treated me really well. I'm sure some people will be successful with itunes apps. but the way you make money appears to me to be converging with the way you make money on the web.

Nov 06 01:17 PM

[directcommu...:]

seems like phones are slowly replacing laptops

Nov 08 03:47 PM

[William Cowie:]

Rewind 20 years or so, to the first salvos of the MAC/Windows war. Microsoft won in part because they welcomed software developers, while Apple didn't care. Jobs then witnessed the truth he now lives by: apps (software) drive hardware sales. This time round, Apple is rolling out the red carpet for software developers and, not coincidentally, winning this platform war.

By entrenching themselves as the standard, they've made it near impossible for latecomers to dethrone them, no matter how much better their product might be.

Nov 12 11:47 PM