Apple's iOS brings developers 5x more revenue per download than Android
Despite Android's significantly larger installed base, iOS continues to dominate in monetization with a five-times-greater return rate for developers -- a sign that Cupertino's market segmentation strategy is paying dividends for application creators.
For every $1.00 in app download revenue earned by iOS developers, their Android counterparts earn just $0.19, according to data compiled by Business Insider. The gap for up-front and in-app purchases is slightly narrower, with Android bringing in $0.43 for every $1.00 on iOS, while advertising revenue is the closest at $0.77 on the dollar.
The data, collated from several sources including app analytics firms Flurry and App Annie, is the latest evidence that while Android may be winning the battle for market share, Apple is winning the war for user engagement.
Last month, a report from major Facebook advertising firm Nanigans said that ads on Apple's platform posted returns nearly 1,800 percent higher than the same ad running on Android. In fact, putting money into Android netted advertisers a negative return on investment, to the tune of a 10 percent loss.
"Audiences cost more on iPhone, and the reason is that it's worth it," Nanigans SVP Dan Slagen said at the time. "Typically, we're not looking to acquire one-time customers, we're looking to invest over time...so we pay more up front for better long-term results."
Time and again, studies have shown that Apple customers simply use their devices more often and are more wiling to pay for content. Web analytics firm Chitika found earlier this year that seven out of every eight internet-connected tablets was an iPad, while Flurry Analytics noted that iPhone users spend an average of 19 cents per app downloaded against just 6 cents per download for their Android counterparts.
Apps are not the only storefront where Apple dominates. The iTunes Store accounts for 67 percent of digital television purchases and 65 percent of digital movie sales, as well as 63 percent of the worldwide digital music market.
For every $1.00 in app download revenue earned by iOS developers, their Android counterparts earn just $0.19, according to data compiled by Business Insider. The gap for up-front and in-app purchases is slightly narrower, with Android bringing in $0.43 for every $1.00 on iOS, while advertising revenue is the closest at $0.77 on the dollar.
The data, collated from several sources including app analytics firms Flurry and App Annie, is the latest evidence that while Android may be winning the battle for market share, Apple is winning the war for user engagement.
Apple customers use their devices more often and are more willing to pay for content.
Last month, a report from major Facebook advertising firm Nanigans said that ads on Apple's platform posted returns nearly 1,800 percent higher than the same ad running on Android. In fact, putting money into Android netted advertisers a negative return on investment, to the tune of a 10 percent loss.
"Audiences cost more on iPhone, and the reason is that it's worth it," Nanigans SVP Dan Slagen said at the time. "Typically, we're not looking to acquire one-time customers, we're looking to invest over time...so we pay more up front for better long-term results."
Time and again, studies have shown that Apple customers simply use their devices more often and are more wiling to pay for content. Web analytics firm Chitika found earlier this year that seven out of every eight internet-connected tablets was an iPad, while Flurry Analytics noted that iPhone users spend an average of 19 cents per app downloaded against just 6 cents per download for their Android counterparts.
Apps are not the only storefront where Apple dominates. The iTunes Store accounts for 67 percent of digital television purchases and 65 percent of digital movie sales, as well as 63 percent of the worldwide digital music market.
Comments
I thought Android phones had the highest return rate ¡
Woah ... just seen AAPL ... :smokey:
No one compares Mercedes or BMW's market shares to Toyota's. I glanced through Toyota's website the other day and counted some 25 different models. BMW may offer 10. And yet, there are places for both Toyota and BMW. Why don't everyone bash BMW? BMWs are more expensive, less reliable, have fewer choices, but the driving experience and the prestige make people feel it's a worthwhile car. When talk about cars, a BMW is compared to a Lexus. While do premium Apple phones are compared to all Android phones, ranging from $200 - $600?
I'd like someone to come up with Apple's market share in the premium phone segment, those that cost $500 and up. Sure, you can sell a lot of cheap stuffs to a lot of cheap people, but you ain't making a lot from that.
You are correct of course. DED wrote a great post a few weeks back on this. Statistics can be spun anyway these analysts and PR companies want and the masses eat them up as facts, Coke with low % sales versus all carbonated beverages on earth ... next to a graph of Pepsi YoY sales ... and so on ... meaningless, but shit like that seems to work. The question DED tried to answer was why do PR companies and analysts do this? My question is with Apple's money why don't they play the statics / PR game too? They would at least have truth on their side.
The reading of the entire article rather than a cursory glance at one part of a diagram would probably help you grasp the iOS eco system's total dominance of Google's and its attempt to copy Apple's.
EDIT: I guess the chart copied from BusinessInsider is supposed to be a visual summation of several different articles posted on the net over the past year or so? I see they've sourced App Annie for one of the bar graphs, and Flurry for another. I've no idea who the source is for either the first or last graph claims and BI doesn't offer any other details.
Eric Schmidt will not be happy
Eric Schmidt will not be happy
This is precisely why Eric’s now laughable prediction that developers would be Android first and iOS second or not at all has not come to pass. He made that prediction two years ago, in December 2011. He was full of shit back then and still is.
This is precisely why Eric’s now laughable prediction that developers would be Android first and iOS second or not at all has not come to pass. He made that prediction two years ago, in December 2011. He was full of shit back then and still is.
And yet, his various postings receive broad attention and are more likely to be remembered as "true" by the majority of the general public, than any news about Apple ... unless it's negative. Drives me crazy seeing crap like this happen constantly, with very few writers/reporters making the effort to point out inaccuracies or flat-out lies. Real reporting has fallen by the wayside, all in pursuit of page views and clicks.
iPhone: Someone who uses their smartphone a lot, particularly for business and on the go, doesn't mind paying more for an iPhone, particularly since a two-year cellular contract quickly wipes out the price difference. They'll also buy more apps and spend more time online.
Android: On the other hand, someone who just wants a phone that sometimes does other things will go for a cheaper smartphone. That means Android. And they won't be as interested in buying apps or browsing online either.
I'm an illustration. I drive a 30 year-old Toyota. When I consider getting something newer, I quickly find myself asking "Why?" I don't drive much. Since I write out of a home office, driving isn't a part of my work. A newer car would add no value to my life. On the other hand, because do find quite a bit of value in having a smartphone, I've gone with an iPhone, although I've saved money by picking up a used 3gs.
At bit over a century ago, there was a politicized madness that inflicted many, including writers such as H. G. Wells. Society, they thought, was too higgly piggly, with an overabundance of choices. Why have hundreds of kinds of soaps, when four of five, designed and selected by experts, would do all that soap needs to do. For that, think cells phones, including smartphones.
That madness is returning with a vengeance in our day, particularly in anything connected with health as G. K. Chesterton warned long ago in his Eugenics and Other Evils. Healthcare choices, some think, need to be dictated from above with some plans regarded as too comprehensive and others as too minimal to be permitted. That's what lies at the root of all those finding out that an individual plan they like is being cancelled.
The same mindset can inflict digital devices. Some value openness and trumpet Android. Others want the least hassle and go with iPhones. And some silly people think this competition ought to have a clear winner. No, it shouldn't. Apple better fits the needs of some and Android those of others. No expert can ever decide which should be offered and which shouldn't.
Ditto that old Windows v. Mac v. Linux fuss.
Apple has 75% of the profit share for phones over $500 (with Samsung at 30% and rest at negative, remember that Samsung makes significant profits from the low/mid end)
Apple has 95% of the profit share for tablets over $400
They absolutely dominate the high end. PERIOD.
Wrong
No one compares Mercedes or BMW's market shares to Toyota's. I glanced through Toyota's website the other day and counted some 25 different models. BMW may offer 10. And yet, there are places for both Toyota and BMW. Why don't everyone bash BMW? BMWs are more expensive, less reliable, have fewer choices, but the driving experience and the prestige make people feel it's a worthwhile car. When talk about cars, a BMW is compared to a Lexus. While do premium Apple phones are compared to all Android phones, ranging from $200 - $600?
I'd like someone to come up with Apple's market share in the premium phone segment, those that cost $500 and up. Sure, you can sell a lot of cheap stuffs to a lot of cheap people, but you ain't making a lot from that.
I think someone recently did that and it was a LITTLE more accurate, but I think they needed to split it up into more categories and it might need to be done by price and by screen size.
I think why they don't do that is that it's too much trouble for these market analysts, you know how busy these guys are, any additional work is just too much for them. /s
No one compares Mercedes or BMW's market shares to Toyota's. I glanced through Toyota's website the other day and counted some 25 different models. BMW may offer 10. And yet, there are places for both Toyota and BMW. Why don't everyone bash BMW? BMWs are more expensive, less reliable, have fewer choices, but the driving experience and the prestige make people feel it's a worthwhile car. When talk about cars, a BMW is compared to a Lexus. While do premium Apple phones are compared to all Android phones, ranging from $200 - $600?
I'd like someone to come up with Apple's market share in the premium phone segment, those that cost $500 and up. Sure, you can sell a lot of cheap stuffs to a lot of cheap people, but you ain't making a lot from that.
Here's an article that suggests that 81% of the Android phones are just junky $215 smartphones, which is probably pretty close.
http://appleinsider.com/articles/13/11/12/idc-data-shows-66-of-androids-81-smartphone-share-are-junk-phones-selling-for-215
Even if costs are greater than revenue for one platform, it may still be a net win to do both. Cross platform is often a huge benefit even if some platforms don't support development through direct sales.
It doesn't say that at all. The article is about revenue and says nothing at all about costs. As long as revenue is greater than costs, it may be "worth it". There are probably differences in development costs which make direct comparisons difficult.
Even if costs are greater than revenue for one platform, it may still be a net win to do both. Cross platform is often a huge benefit even if some platforms don't support development through direct sales.
I think it's trying to explain why developers have the iOS first strategy as there is more money in it. Some don't even develop for Android. Plenty of those examples. I can rattle off plenty of apps that are only available on iOS and it's for both a technical reason and a market choice reason.
Example, if you look at the professional and prosumer music creation/production market, there are companies like Mackie that don't make products for Android, they only make them for iOS. Check out the DL1608 and DL806, which will probably get updated for the newer iPads as they will require a different physical design to accommodate the case designs. These use a special app written for iOS that doesn't work with anything else.
MoogMusic basically writes all of their apps for iOS and I think they might have one or two for Blackberry, and then they have apps for traditional OS X and Windows, but not Windows RT or Android. Those two are not on the list.
I think the main reason is that iOS has CoreAudio functionality and Android doesn't have anything like that. So, for the apps that would use CoreAudio, you probably won't see those types of apps on Android, ever or at least until Android decides to implement something similar that the music creation/production industry wants to use.
It's too bad there isn't a website that tracks all of the apps on every platform and has a database we can look up as to which apps are only written for iOS.
But but but Androiders love ads!
And it's got to be FREEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEE! since most of the Android users have or don't spend much money since they are CHEEEEEEEEEEEEEEEEEEEEEEEEEEEEEAP.