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iOS 'stickiness' grows as average Apple user has $100 in content per device

post #1 of 52
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With an average of $100 in content purchased on every Apple mobile device, it is increasingly difficult for users to justify the switch from the iOS ecosystem to a competing platform like Android, a new analysis has found.

With a current installed base of about 225 million iOS-powered units, Apple customers have invested about $22 billion in content, cumulatively, for those devices, analyst Chris Whitmore with Deutsche Bank said in a note to investors on Monday. He sees the install base growing to more than 300 million units by the end of calendar year 2012, with sales more than $30 billion by the end of next year.

"This averages to (about) $100 of content for each installed device; suggesting switching costs are relatively high (not to mention the time required to port)," Whitmore wrote. "While Apple's best in class user experience is combined with these growing switching costs, the resulting customer loyalty is unparalleled."

Whitmore sees the "stickiness" of the iOS platform growing even more later this year, when Apple offers automatic, free syncing of data with iCloud. The new service, which will back up purchases, application data and device settings while offering storage of documents and photos, will further differentiate iOS from competing platforms.

The analysis comes after Apple revealed that it has reached a new milestone of 15 billion applications downloaded through the iOS App Store last week. A separate report from earlier Monday indicated that 18 percent of applications on the App Store are paid.

It's the investment in those paid applications, along with the purchase of content through the iTunes Store like music or movies, that Whitmore believes will make it even harder for users to switch to another platform.



He expects the development of applications for iOS devices to accelerate even further this year, when the iPhone and iPod touch are expected to receive hardware refreshes. Whitmore predicted last month that Apple will introduce a new iPhone hardware model priced at about $350 contract-free, addressing a huge market of 1 billion pre-paid mobile customers worldwide.

"In addition to new hardware, we expect the combination of an enormous iOS ecosystem, iCloud and a lower priced iPhone will extend AAPLs market reach and leadership with developers and customers alike, further enhancing the overall value of the iOS platform," he said.
post #2 of 52
While maybe weaker, since Android users tend to purchase less than iOS users, "stickiness" on the part of Android users is presumably still there also. Perhaps Apple should have done more to thwart the dramatic growth of Android in 2008 and 2009, when it would have been much easier to do so. Maybe a $2 billion patent purchase would not have been necessary too.
post #3 of 52
That's right in line with a similar report today from TotalTelecom. They also concluded that iOS and Android users are committed to their platforms, with no evidence that either camp is prone to change to the other. And that's at least in part because of the applications that users have collected and become accustomed to on their existing device.

http://www.totaltele.com/view.aspx?ID=466170
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post #4 of 52
Quote:
Originally Posted by Gatorguy View Post

That's right in line with a similar report today from TotalTelecom. They also concluded that iOS and Android users are committed to their platforms, with no evidence that either camp is prone to change to the other. And that's at least in part because of the applications that users have collected and become accustomed to on their existing device.

http://www.totaltele.com/view.aspx?ID=466170

Well, I am an Android phone user and I would switch to the iPhone if it had a few things that I want like a larger screen (a must for my bad eyes) and text reflow in the browser, and as a Verizon user, LTE. The other limitations I can mostly overcome by jailbreaking (especially now that A Swype like app is being developed). iOS5 will also add some much needed improvements.

For now I use iPad for my iOS needs. As I have an iPad, I could switch back and forth and not lose my iOS app investment.
post #5 of 52
The really interesting calculation is what will happen if Microsoft and Nokia can get their act together and release a compelling alternative to Android.
post #6 of 52
Quote:
Originally Posted by shadash View Post

While maybe weaker, since Android users tend to purchase less than iOS users, "stickiness" on the part of Android users is presumably still there also. Perhaps Apple should have done more to thwart the dramatic growth of Android in 2008 and 2009, when it would have been much easier to do so. Maybe a $2 billion patent purchase would not have been necessary too.

Except Android/Google's primary business model is to give apps away and charge for advertising. Not only is that not as "sticky", it creates ill-will every time an annoying ad appears.
post #7 of 52
I've always said that Android users are cheap, and here is yet more evidence proving my point. Most Android people primarily base their purchasing decisions on price alone, and they go for what is cheap. The cheaper, the better, and free is best of all, even if it comes with a ton of annoying ads.

I've looked briefly around the Android market and it's complete garbage. Hardly any music apps for a person like me, and the majority of apps looks like it was made by complete amateurs and people with no sense of style and piss poor design skills, not to mention the fragmentation problems that Android has.

If the average iOS user has $100 in content per device, how much does the average Android user have? I will guess less than $10.
post #8 of 52
While I would agree that 'apps' are generally sticky, I would disagree with including music in that category. I don't have an android device but I would assume they are able to play AAC files.

Also, I would imagine that many apps that are purchased are no longer used (I know that is the case for me) so that the actual amount of money that each user would need to spend to get the main apps that he/she uses on a regular basis will be smaller than the user's total history of expenditures on apps.
post #9 of 52
crush the rebel alliance.
post #10 of 52
Quote:
Originally Posted by jukes View Post

The really interesting calculation is what will happen if Microsoft and Nokia can get their act together and release a compelling alternative to Android.

With the Zune brand rumored to come back as a subscription service, I don't think MS will get its act anytime soon.
Originally Posted by Granmastak: Labor unions managed to kill manufacturing a long time ago with their unreasonable demands. Now the people they were trying to protect, are out of a job.
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Originally Posted by Granmastak: Labor unions managed to kill manufacturing a long time ago with their unreasonable demands. Now the people they were trying to protect, are out of a job.
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post #11 of 52
Quote:
Originally Posted by Apple ][ View Post

racist comment removed

Wow really...I'm surprised you could see he "racist comment removed" with your hood still on...
post #12 of 52
Quote:
Originally Posted by Apple ][ View Post

I've always said that Android users are cheap, and here is yet more evidence proving my point. Most Android people primarily base their purchasing decisions on price alone, and they go for what is cheap. The cheaper, the better, and free is best of all, even if it comes with a ton of annoying ads.

I've looked briefly around the Android market and it's complete garbage. Hardly any music apps for a person like me, and the majority of apps looks like it was made by complete amateurs and people with no sense of style and piss poor design skills, not to mention the fragmentation problems that Android has.

If the average iOS user has $100 in content per device, how much does the average Android user have? I will guess less than $10.

You and I would get along just great.
post #13 of 52
As an avid IOS user, its difficult to make the jump to another platform when I have so much invested already. I'm wondering if these apps in the future will be multi-platform? Maybe just log-in and download without having to pay? I heard a few tech companies were attempting something similar to that affect.
post #14 of 52
Who the heck comes up with these words?!

With the Zune you could "Squirt"!...

With the iOS eco system and money invested there is a "Stickiness"?! Quick, somebody, a Thesaurus!

Stickiness! Yuck!! It just sounds so perverse... How about cohesiveness?... May we can get a better choice of descriptive words in the future?

Please.....
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Ten years ago, we had Steve Jobs, Bob Hope and Johnny Cash.  Today we have no Jobs, no Hope and no Cash.

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Ten years ago, we had Steve Jobs, Bob Hope and Johnny Cash.  Today we have no Jobs, no Hope and no Cash.

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post #15 of 52
Quote:
Originally Posted by Apple ][ View Post

racist comment removed

This is the stupidest comment I have ever seen on these boards, and that is saying something.
post #16 of 52
Quote:
Originally Posted by theoneaboveall View Post

Wow really...I'm surprised you could see he "racist comment removed" with your hood still on...

Yeah, when there is an air of "I'm better than you" and the feeling one is above all, don't you just hate it? \
/
/
/

Ten years ago, we had Steve Jobs, Bob Hope and Johnny Cash.  Today we have no Jobs, no Hope and no Cash.

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Ten years ago, we had Steve Jobs, Bob Hope and Johnny Cash.  Today we have no Jobs, no Hope and no Cash.

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post #17 of 52
Quote:
Originally Posted by Rot'nApple View Post

Who the heck comes up with these words?!

Stickiness has been a concept in economics for years

http://en.wikipedia.org/wiki/Sticky_(economics)

I'm afraid your victorian maidenly sensibilities will just have to cope.
post #18 of 52
Quote:
Originally Posted by Rot'nApple View Post

Who the heck comes up with these words?!

With the Zune you could "Squirt"!...

With the iOS eco system and money invested there is a "Stickiness"?! Quick, somebody, a Thesaurus!

Stickiness! Yuck!! It just sounds so perverse... How about cohesiveness?... May we can get a better choice of descriptive words in the future?

Please.....
/
/
/

Wow, you must be really bothered by "Hard Drive", "Input", heck, even "iPad" sounds kinda dirty if you think about it long enough (hehehe I said "long")...
post #19 of 52
Developers might make migration easier. Give apps on both platforms (iOS and Droid) the ability to acquire a one-time redeemable code, sent by email, to get the same app on the other platform for free. That should also work with Mac OS X apps. Developers could build into a non-app-store update the ability to get a code a user could redeem for a free app-store version. The app itself would keep the code from being redeemed more than once.

Of course, the app store on each platform would have to support that redemption. But a strong incentive to do so would be there. If Apple refuses to support the idea, then it'd be easier to move from iOS to Droid than vice versa. Apple and Google would both have reason to subsidize the move to get more market share.
post #20 of 52
I paid $50 for the Tom Tom app alone. It seems also that $4.99 is the new $0.99 as I paid $4.99 each for the Weber Grill and Cyclemeter 5.0 apps.

To think that at least a quarter of the iPhones out there are jailbroken and running pirated apps, so the amount spent on apps by legit iPhone owners could be $150+.
post #21 of 52
Huh? Considering most Android devices are more than $100 cheaper than a comparable iOS device, that doesn't induce stickiness at all! Add to the fact that most comparable apps are then free on Android, and it does things than iOS never will (flash, widgets, etc) and you have an even more compelling argument to actually make the switch!
post #22 of 52
Quote:
Originally Posted by Xanthia01 View Post

Huh? Considering most Android devices are more than $100 cheaper than a comparable iOS device, that doesn't induce stickiness at all! Add to the fact that most comparable apps are then free on Android, and it does things than iOS never will (flash, widgets, etc) and you have an even more compelling argument to actually make the switch!

Remarkable density of misinformation per word, there.
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They spoke of the sayings and doings of their commander, the grand duke, and told stories of his kindness and irascibility.
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post #23 of 52
Quote:
Originally Posted by aspenboy View Post

While I would agree that 'apps' are generally sticky, I would disagree with including music in that category. I don't have an android device but I would assume they are able to play AAC files.

Also, I would imagine that many apps that are purchased are no longer used (I know that is the case for me) so that the actual amount of money that each user would need to spend to get the main apps that he/she uses on a regular basis will be smaller than the user's total history of expenditures on apps.

They're going to start calling you a fandroid and a troll if you start using logic. Especially considering that the chart indicates that about $45 of that $100 is actually music. Going by the weird logic that music creates "stickiness" with a brand implies that I must have about $1400 worth of stickiness with my Pre 2 (since there's over 1400 songs on it right now). But although WebOS has the potential to be a great mobile OS, my next phone won't be running it.
post #24 of 52
I don't consider 'stickiness' a reason for sticking onto particular brands. Their offering however do followed by usefulness and longevity. Cost is similarly irrelevant. So, if Apple is to suddenly change their principal and philosophy in the way they make their hardware and OS then I would jump ship providing there are truly better alternatives and not just because.
post #25 of 52
Horace Dediu has a good post on this topic here. I don't think he uses the term "sticky" but it's what he's talking about.

He makes the argument that customer loyalty is a function of "good enough" (where the costs of changing brands are not outweighed by any appreciable gains in user experience) and that the smart phone market probably isn't "good enough" yet on any platform to lock in users:

Quote:
So with this hypothesis in mind, it makes sense to analyze whether Android or iOS, the current presumed champions, are “good enough” on the basis of how often users switch out of them. My bet is that neither is good enough and that there will be increasing churn between platforms. I imagine that Android is less sticky (and hence less than good enough) based on app consumption but there is little evidence of churn because most phones in use have been bought less than one device generation ago. More importantly, there have been few opportunities yet for switching as many Android buyers don’t even have the choice of other platforms either due to where they live or how much income they have available.

To really tell where we stand, we would need to collect stats on switchers to know just how satisfactory the platforms may be. Remember that a choice of a new deodorant on the same shelf at nearly the same price is the test for loyalty. For an adequacy test we need to see better distribution and more choices for consumers. It’s still very early even in the US for any conclusions to be drawn about the adequacy of Android.
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They spoke of the sayings and doings of their commander, the grand duke, and told stories of his kindness and irascibility.
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post #26 of 52
wow the f//ing moon must be out
so many stoopid posts all at once .
>>>>>
back on topic
>>>>>>>
if you buy apps 3 or 5 yrs ago and buy a ios device
bamn all those old apps down load into your devices and your mac

So what apple has done is and what the cloud will cement IS Apple really takes care of us . they made tons of great apps super cheap
they have made a policy of no more discs any more so if you buy a new computer all you apps like Aperture or Pages simply download,S right in .


SO apple will make it so cheap and easy and safe to buy software from them .

APPLE will make a ton of money off this .


rock on

9
whats in a name ? 
beatles
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whats in a name ? 
beatles
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post #27 of 52
Quote:
Originally Posted by Xanthia01 View Post

Huh? Considering most Android devices are more than $100 cheaper than a comparable iOS device, that doesn't induce stickiness at all! Add to the fact that most comparable apps are then free on Android, and it does things than iOS never will (flash, widgets, etc) and you have an even more compelling argument to actually make the switch!

Does your Android device have this?

I'm quite enjoying the iOS App on my iPhone or iPad, plenty of entertaining live music provided by Apple.

That's entertainment, that's ecosystem, that's stickyness.
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Better than my Bose, better than my Skullcandy's, listening to Mozart through my LeBron James limited edition PowerBeats by Dre is almost as good as my Sennheisers.
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post #28 of 52
Quote:
Originally Posted by hill60 View Post

Does your Android device have this?

I'm quite enjoying the iOS App on my iPhone or iPad, plenty of entertaining live music provided by Apple.

That's entertainment, that's ecosystem, that's stickyness.

Yes it is. At the same time Google Navigation adds it's own degree of stickiness to Android. Each platform has a few apps that users might find hard to replace if they decide to try out the competition.
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post #29 of 52
Quote:
Originally Posted by Inkling View Post

Developers might make migration easier. Give apps on both platforms (iOS and Droid) the ability to acquire a one-time redeemable code, sent by email, to get the same app on the other platform for free. That should also work with Mac OS X apps. Developers could build into a non-app-store update the ability to get a code a user could redeem for a free app-store version. The app itself would keep the code from being redeemed more than once.

Of course, the app store on each platform would have to support that redemption. But a strong incentive to do so would be there. If Apple refuses to support the idea, then it'd be easier to move from iOS to Droid than vice versa. Apple and Google would both have reason to subsidize the move to get more market share.

Why is app portability a right? Or even a need? It is certainly not a given on PCs, where portability is far more important.
post #30 of 52
I find myself looking at new Android phones and wonder what it would be like to use one. Then I remember that such musings are pointless as I own so much iTunes media and apps that I am locked into the Appleverse for life.
post #31 of 52
Quote:
Originally Posted by Gatorguy View Post

Yes it is. At the same time Google Navigation adds it's own degree of stickiness to Android. Each platform has a few apps that users might find hard to replace if they decide to try out the competition.

Google Navigation and software programs like it kill developer opportunities and decrease "stickiness" and reliance on purchased software.

An example, I bought GPS software for $15 over a year ago it works on my iPad and iPhone, it has red and speed camera warnings along with speed limits, including school zones with variable limits, it was developed locally, with local voices AND it links into Google search for POI's if required.

My iPhone does what I need, I don't need Google's offering.
Better than my Bose, better than my Skullcandy's, listening to Mozart through my LeBron James limited edition PowerBeats by Dre is almost as good as my Sennheisers.
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Better than my Bose, better than my Skullcandy's, listening to Mozart through my LeBron James limited edition PowerBeats by Dre is almost as good as my Sennheisers.
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post #32 of 52
Quote:
Originally Posted by uguysrnuts View Post

With the Zune brand rumored to come back as a subscription service, I don't think MS will get its act anytime soon.

Come back? It never left.

Clearly you have never used it. As we wait for iCloud, you can stream today on 3G using Zune and the Mango update.

Maybe I don't understand what you were trying to say.
post #33 of 52
Quote:
Originally Posted by hill60 View Post

Google Navigation and software programs like it kill developer opportunities and decrease "stickiness" and reliance on purchased software.

An example, I bought GPS software for $15 over a year ago it works on my iPad and iPhone, it has red and speed camera warnings along with speed limits, including school zones with variable limits, it was developed locally, with local voices AND it links into Google search for POI's if required.

My iPhone does what I need, I don't need Google's offering.

So by your logic the new mobile Safari Reader mode decreases iOS's stickiness, since it replaces Instapaper, and "kills developer opportunities?"

You've obviously never used the Google Maps app on Android, which is superb, and free, and is a very good reason to stick with the Android platform.
post #34 of 52
Quote:
Originally Posted by Gatorguy View Post

Yes it is. At the same time Google Navigation adds it's own degree of stickiness to Android. Each platform has a few apps that users might find hard to replace if they decide to try out the competition.

http://xkcd.com/461/
post #35 of 52
Quote:
Originally Posted by addabox View Post

Remarkable density of misinformation per word, there.

I'm happy to accept that - if you can tell me why. What is misinformation in my post? Let's look at the points one-by-one shall we?

Price. An HTC Desire S costs $293 less than the cheapest iPhone 4. A Samsung Galaxy SII costs $187 less.

Apps. Fact: Android has more free apps.

Flash. iOS does not do Flash.

Widgets. iOS doesn't have widgets.

Where then, exactly, is this "remarkable density of mis-information"?
post #36 of 52
Quote:
Originally Posted by stelligent View Post

Why is app portability a right? Or even a need? It is certainly not a given on PCs, where portability is far more important.

I agree with Inkling - app portability is certainly there on PCs - I can move from a Lenovo to an HP with no issue. And most apps support cross-grades from MacOS --> Windows and vice versa, in cases where the same app exists on each platform.

And most popular apps are available on both iOS and Android, making this even more of an obvious step.
post #37 of 52
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post #38 of 52
Suddenly, a wild observation appears! Why has no one commented that the purple line is kind of flatlining towards the end of the graph? Yes iOS is still "sticky" but the purple line indicates people are plateauing on their spending per unit. Correct me if I'm wrong.
post #39 of 52
Quote:
Originally Posted by Xanthia01 View Post

I'm happy to accept that - if you can tell me why. What is misinformation in my post? Let's look at the points one-by-one shall we?

Price. An HTC Desire S costs $293 less than the cheapest iPhone 4. A Samsung Galaxy SII costs $187 less.

Apps. Fact: Android has more free apps.

Is this the breadth of fresh air or what? Finally somebody admitted what we've known all along: Android is a cheaper platform (generally speaking). Where are all the denialists?
post #40 of 52
Quote:
Originally Posted by dona83 View Post

I paid $50 for the Tom Tom app alone. It seems also that $4.99 is the new $0.99 as I paid $4.99 each for the Weber Grill and Cyclemeter 5.0 apps.

To think that at least a quarter of the iPhones out there are jailbroken and running pirated apps, so the amount spent on apps by legit iPhone owners could be $150+.

I am an avid iOS user, but my iPhone is jail broken (it's a 2g on T-mobile) and I don't have a single "pirated app", I jail broke so I could avoid AT&T and still have GSM for international travel. I have quite a few paid Cydia Apps installed to add functionality such as lock screen notifications (a $9.99 app). I think the general US public is under educated about how jail breaking works and what value it adds (for users like me and developers alike). My iPad2 is bone stock, after Apple enabled mirroring for certain apps (my iPad1 was jail broken for a while, for that reason), but I think there is still functionality it lacks. I am excited for iOS 5, and I hope the next iPhone will also support T-mobile 3G/4G, otherwise I will continue with used older models and jail break.

Your (judgemental) assumption brings up a good question though: Was the Cydia App store accounted for when calculating the dollar volume? I am guessing not, which means that the financial commitment to iOS may be even higher.
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