How long does it take to make $2billion? According to former Nokia manager Horace Dediu, the answer depends on the business you’re in. If you’re a record company, 34 months. If you’re a developer, just 31.
In the eight years since it launched, the iTunes Music Store has generated around $12billion for record labels. The App Store is younger, and it’s making more money more quickly. Apps, it seems, are bigger than The Beatles.
That’s interesting for several reasons. It’s interesting because apps are often simple front-ends for online content; content that’s often freely available via the same device’s web browser. It’s interesting because it shows the power of a decent micropayments system, facilitating impulse buys and in-app upgrades. Most of all, it’s interesting because something strange happens in the move from the browser to the dock: apparently worthless content becomes worth something. With a few exceptions, if you take online content and put it behind a paywall you’re writing your site’s suicide note; take the same content, wrap it in an app and you’ll hear the merry sound of tills jingling.
The wrapping needs to be done properly, though. Take iPad magazine apps: sheer novelty helped Wired sell 100,000 copies of its debut iPad edition; by November sales were down to 23,000. Glamour’s sales dropped 20 per cent in October and 20 per cent the following month, with just 2,775 sales in November. The same month saw GQ’s lowest-ever iPad sales, shifting 11,000 copies. Men’s Health struggled to do 2,000 copies. And so on.
Big Mouth: Apps to inspire
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