Tuesday, 26 August 2014

1.6% of app developers make more revenue than the other 98.4% combined

"A study last month of more than 10,000 app makers by market analysts VisionMobile found that 1.6 per cent of developers make more than the other 98.4 per cent combined. While the research estimates there are almost 3m mobile developers in the world today, more than half make less than $500 per app per month.
“It seems extremely unlikely that the market can sustain anything like the current level of developers for many more years,” it concluded."
From the VisionMobile report, August 2014
"The figures in our Q3 2014 State of the Developer Nation report are once again crystal clear: the vast majority of app developers struggle to make a living. 7 out of 10 don’t earn enough to sustain full-time development (we call them the Have Nothings and Poverty Stricken). That would be over 2 million people, roughly the population of Slovenia. Almost 90% of that record app store revenue will go to just 12% of developers.
While more app store revenues are clearly a good thing for developers, the money is peanuts compared to what Apple makes. In Mobile Megatrends 2014, we showed that Apple captures 80% of the total iOS “ecosystem GDP”, while developers capture less than 15% (including commissioned apps released without any revenue model).
The situation on Android is even worse. Whereas 50% of iOS developers live below the poverty line, the number for Android is 64%. Also for Android, hardware makers capture 80% of ecosystem GDP, while developers are scrambling over the left-overs. Other ecosystems like Windows Phone or Blackberry don’t have the scale to provide viable escape routes.
Ecosystems can sustain this situation as long as there is supply of developers hoping to get rich. Only 1.6% of developers have an app that earns >$500K per month, but those few big wins will make all the difference for the motivation of the Have Nothings, the Poverty Stricken and the Struggling to keep creating (source). Asking whether developer ecosystems are sustainable is like asking for how long casinos will exist given that most participants lose money. “Indefinitely” would be a safe bet."

No comments: