iOS

Apple Developer payouts hit $8 billion

Wednesday, February 13, 2013

Last January Apple reported developer payouts were at $7 billion dollars, but while at the Goldman Sachs Technology and Internet Conference this week, Tim Cook announced payouts have hit $8 billion. That is $1 billion to developers in a years time, wow!

So what is happening that Apple's payout to developers has increased so much? One obvious thing is the increase in the app store downloads in general. New devices such as the ipad mini and iPhone5 in 2012 helped to fuel that. Another thing is that developers seem to be sticking with iOS rather than jumping off to develop for HTML5, Android, or RIM just yet which helps keep app inventory fresh.

But amidst other reasons is one that stands out to me more than anything, and that is the model at which developers are turning to for revenue streams these days. In the past few years in mobile is was quick and easy to simply do banner advertisements or in-app ads of another sort inside the app. Most developers would agree that banner advertising is hit and miss from a profit perspective and used to be more profitable than it used to be. So more developers are using in-app purchases or "freemium" type models to earn profits today, which adds to the markets bottom line as well as the developers and helps generate more payouts.

At AppsWorld 2013 North America this year, GetJar's Chris Dury stated "advertising inside an app is all but dead", while speaking to a crowd of anxious developers looking for new ways to earn revenue. He was talking about carrier-billing during the conference and how it relates to the Android market specifically, but it does touch on the fact that developers are looking for ways to leave the "advertising business" inside their apps, and use methods that help them earn more revenue - even when it comes directly from the market itself (Apple, Android, etc.)