Apple App Store took 65% of the $112 billion spent on apps in 2020

Posted:
in General Discussion edited December 2020
Amid an acceleration in mobile adoption during the COVID-19 pandemic, the iOS App Store continued its domination of app revenue, setting a new annual record.

Credit: Apple
Credit: Apple


According to a report from app analysis firm App Annie, the amount of money spent on the iOS App Store and the Google Play Store hit an estimated $112 billion in 2020, representing year-over-year growth of 25%. The ongoing coronavirus pandemic accelerated global mobile adoption by two or three years as users across the globe leaned on their smartphones to "connect, work, learn, play and escape."

About 65 cents out of every dollar spent on mobile app stores went to the iOS App Store, but App Annie notes that spend on Google Play is on track to grow 30%. Both app stores set new annual records in 2020.

Top growth markets for the iPhone and iPad App Store included the U.S., Japan, and the U.K. That differs from past years, in which the top markets were the U.S., China, and Japan. For Google's app store, the top markets included the U.S., South Korea, and Germany.

As far as the breakdown of revenue by app category, about 71 cents out of every dollar went to games on both iOS and Android. Among non-gaming categories, in-app subscriptions drove the most growth.

On iOS, the top categories for growth included Games, Photo and Video, and Social Networking. For Android, the top three categories were Games, Entertainment, and Social Networking.

Apple doesn't break out app Store revenue from its Services business during earnings call, but the broader Services category brought in $14.5 billion in Apple's fourth 2020 quarter. That set a new record high for the segment, and represented growth of 16.3% year-over-year.

The Cupertino tech giant also noted that individual Services like the App Store set new records during the fourth quarter. Apple hit 585 million paying subscribers during the period, and is on track to hit 600 million by the end of 2020.

Comments

  • Reply 1 of 9
    lkrupplkrupp Posts: 9,010member
    And iff Epic had its way the Apple App Store will take in 0% of the $112 billion
  • Reply 2 of 9
    BeatsBeats Posts: 2,103member
    Not enough. I want to see Apple take 80%.
  • Reply 3 of 9
    crowleycrowley Posts: 7,638member
    Given how many apps use advertising as a revenue model, do these numbers really mean all that much?  
  • Reply 4 of 9
    Rayz2016Rayz2016 Posts: 6,699member
    crowley said:
    Given how many apps use advertising as a revenue model, do these numbers really mean all that much?  

    Yes, they mean a lot. Because without revenue, the app store can't operate. 
    watto_cobra
  • Reply 5 of 9
    crowleycrowley Posts: 7,638member
    Rayz2016 said:
    crowley said:
    Given how many apps use advertising as a revenue model, do these numbers really mean all that much?  

    Yes, they mean a lot. Because without revenue, the app store can't operate.
    Sure it can. Both Apple and Google are more than capable of running app stores at a loss. Apple because they get revenue from hardware sales and Google because they get revenue from advertising sales. That's why I'm saying that the app store revenue alone is an incomplete and not particularly useful metric.
    muthuk_vanalingamtokyojimu
  • Reply 6 of 9
    crowley said:
    Rayz2016 said:
    crowley said:
    Given how many apps use advertising as a revenue model, do these numbers really mean all that much?  

    Yes, they mean a lot. Because without revenue, the app store can't operate.
    Sure it can. Both Apple and Google are more than capable of running app stores at a loss. Apple because they get revenue from hardware sales and Google because they get revenue from advertising sales. That's why I'm saying that the app store revenue alone is an incomplete and not particularly useful metric.
    I am going to agree with @crowley here. Let us do a comparison of the 4 biggest app stores in the US (in reverse order). Granted APKMirror, F-Droid etc. probably actually distribute far more apps than a couple on this list but they do so for free. These are the 4 biggest paid app stores.

    0. Samsung: makes a lot of money on hardware but next to nothing on apps. Their app store is the worst, so bad that the #1 Samsung fan site - yes they do exist - trashes it.
    1. Amazon: makes a ton of money on services but not so much on apps. Their app store is horrible.
    2. Google: makes a ton of money on services but a good amount of apps. Their app store is "fine."
    2a. Google: makes a ton of money on services but lost money for years on the ChromeOS app store. That app store was filled with nothing but adware and spyware that Google is slowly shutting down in favor of migrating PWAs to the Google Play Store and trying to figure out something to do with extensions.
    3. Apple: makes a ton on hardware and services and more on apps than 0-2 combined. The best app store in the business and the model for the industry even though they weren't the first app store.

    So yes, if quality, privacy, security etc. mean something to you then these numbers absolutely do mean a lot and this are a very useful metric. Also, mobile app developers strongly prefer $4.99 or $9.99 up front to ongoing revenue from subscriptions or ads. That is why so many mobile app developers are "iOS only" or "iOS first to cover development costs and establish our reputation then Android port to turn a profit." Meanwhile very few mobile developers are "Android only" - beyond creating apps specific to the platform that are useless or won't even run on iOS - with nearly none being "Android first." And among the paid Android app stores, practically the only ones that are in the Amazon and Samsung stores but not Google Play - because if you can develop the app for Amazon or Samsung there is nothing precluding you from submitting it to both or all three - are the ones that are so bad that even Google rejects them. 
    Flytrap
  • Reply 7 of 9
    crowleycrowley Posts: 7,638member
    I'm going to clarify my point a little as I was a bit too sweeping earlier.  I think comparing the current Apple App Store reveneue to previous yearly and quarterly revenue is probably a useful a metric.  It's just comparing it to other app stores that I don't think gives anything particularly illuminating, because different vendors have different priorities, and direct revenue from app sales isn't always the top priority.  Apple themselves claimed that were running the app store at a break even level for a number of years, so revenue wasn't the top priority there either.  Number of apps listed and distributed would probably be a more useful metric because it shows something that's more directly comparable.


    edited December 2020
  • Reply 8 of 9
    crowley said:
    Rayz2016 said:
    crowley said:
    Given how many apps use advertising as a revenue model, do these numbers really mean all that much?  

    Yes, they mean a lot. Because without revenue, the app store can't operate.
    Sure it can. Both Apple and Google are more than capable of running app stores at a loss. Apple because they get revenue from hardware sales and Google because they get revenue from advertising sales. That's why I'm saying that the app store revenue alone is an incomplete and not particularly useful metric.
    That is the most ridiculous thing I have ever heard...
    watto_cobra
  • Reply 9 of 9
    crowleycrowley Posts: 7,638member
    Flytrap said:
    crowley said:
    Rayz2016 said:
    crowley said:
    Given how many apps use advertising as a revenue model, do these numbers really mean all that much?  

    Yes, they mean a lot. Because without revenue, the app store can't operate.
    Sure it can. Both Apple and Google are more than capable of running app stores at a loss. Apple because they get revenue from hardware sales and Google because they get revenue from advertising sales. That's why I'm saying that the app store revenue alone is an incomplete and not particularly useful metric.
    That is the most ridiculous thing I have ever heard...
    I doubt it, but why do you say that?
    edited December 2020 gatorguy
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