Seen on Wall Street Journal (www.wsj.com):
“How much time do people spend with apps? How much money does the average app developer make? The answers may surprise you.
Last week, the Journal began a new series about apps that examines the business strategies, identifies the winners and losers, and chronicles the seedier side of the industry.
“The Business of Apps” also uncovers the numbers behind the industry’s economics. Here’s a look back at some of the more interesting stats from last week’s stories:
First, the big money. The global apps business is expected to make $25 billion in revenue this year, up 62% from a year ago, according to Gartner. To put that in perspective, movie theaters sold less than half that dollar amount at the box office in 2012.
And we have a ton of apps to choose from: Apple’s store now has about 800,000 apps, compared with 700,000 on Google GOOG +0.52%Play, 125,000 on Windows and 70,000 for Amazon.
Yes, business is booming. But it’s also unpredictable. About 63% of the apps used daily now differ from those used daily a year ago. Our attention span is so short these days – and the competition is so fierce – that we soon move on to the latest and greatest app.
On average, we only focus on about eight apps at a time. And we use these apps more than you might think: The average smartphone user spends two hours a day with apps, more than double the time spent two years earlier, according to Flurry Analytics.
Where did we find all this free time? It’s hard to say exactly — if you look at the following graphic, the amount of time watching television and surfing the Web is flat in the past couple of years. Of course, we often have apps running in the background, like music-streaming apps, allowing us to multitask.
So consumption of apps is catching up to television viewing – some might say that’s a good thing, that apps are more productive than watching “Keeping Up With the Kardashians.” But as the following graphic shows, productivity apps capture just 2% of our time. Rather, games are stealing the most of our attention – 43% of our time is spent catapulting angry birds at pigs and fighting monsters.
What are the top-performing apps? Apple says Disney’s DIS +0.23%99-cent “Temple Run: Oz” adventure game is currently the top paid app for its mobile devices, word game Icomania is the top free app and Supercell’s free medieval strategy game “Clash of Clans” is the top-grossing (thanks to in-app purchases).
Free remains king in app stores – most people aren’t willing to shell out money to buy an app, so developers are keen to find ways to show ads or entice with upgrades. But the prices are higher in the Apple store compared with Google’s, where the apps are far more likely to be free.
At the end of 2012, the average price paid for an app in the Apple store was $3.18 on an iPhone and $4.44 on an iPad, according to Distimo. That compares with an average price of $3.06 in the Google Play store. Those two stores represent about 87% of U.S. smartphone users, according to comScore.
Then there are the super-premium apps. The highest price for an app in Apple’s store is $999.99. According to Distimo, there were 30 such apps as of January, mostly software for specialized industries like piano tuners and anesthetics – though at least two of those apps are now free or $1.99, reflecting the constant shifting of business models.
That brings us to the developers. Tens of thousands of them have built nearly 1 million apps over the years. And they’ve earned more than $8 billion in payouts from Apple alone.
But the dirty secret is that most apps aren’t big hits. In fact, only 2% of the top 250 publishers in Apple’s store are “newcomers,” according to Distimo. The bulk of the app makers are factories like Electronic Arts EA +4.01%which can spit out dozens and have huge marketing budgets.
According to a survey of app developers by GigaOM Pro, 34% made less than $15,000 in income. A majority, 65%, make less than $35,000. And just 12% make more than $100,000. The average annual income among survey respondents: $45,000.
If developing your own app doesn’t sound appealing, you can always make money from those who do. Apps have spawned new jobs with people acting as couriers, offering taxi rides and selling clothes. WSJ quotes one man who makes $60,000 a year doing odd jobs requested through TaskRabbit. Another woman makes as much as $3,000 a month selling women’s clothing and accessories from home through Poshmark.”
Here’s what the average developer looks like:
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