Apple's App Store: Has it peaked? No!
One of the results Apple's executive team is sure to trot out Wednesday when it releases the company's fiscal 2009 Q1 earnings report is the explosive growth of its iTunes App Store.
Six months after it opened for business, the store has published more than 15,000 programs for the iPhone and iPod touch and logged at least half a billion downloads — stats Apple (AAPL) trumpeted last Friday on its website and in full-page newspaper ads.
What the company hasn't talked about is how those numbers are trending. Is growth still accelerating? Has it flattened out? Is it starting to head south?
In other words, has the App Store peaked?
The answer emerges from two charts pasted below the fold, plotted from the half-dozen data points Apple has released since July 11, the day the iPhone 3G and the App Store launched.
The charts:
Clearly, the App Store hasn't peaked — at least not yet. In fact, there seems to be something of a snowball effect.
Not only has the number of applications made available for downloading grown since November, but the rate at which they're coming has increased. The average number of apps that show up each day has more than doubled from 30 to 50 per day between August and November to 100 to 120 a day since then. Either a lot more third-party developers are writing for the platform, or Apple has sped up its approval process.
Not surprisingly, given both the growth in apps and the growing number of iPhones in use, sales of applications are also accelerating. After the initial burst of 10 million downloads recorded in two days between July 11 and July 13, they hovered in the range of 1.25 million to 2.72 million a day. Then, in the 42 days between Dec. 5 and Jan. 16, they took off again, averaging 4.76 million a day — nearly back to where they were that first heady weekend in July.
Of course, none of these numbers will mean anything if the fad passes and users decide most of those apps aren't worth the cost and trouble. Gizmodo suggested as much last week with the mock pie-chart, reposted at right, in which they purport to break down the 500 million downloads into eight categories (23% Flashlights, 21% To Do Lists, 11% Fart Apps, etc.).
The actual breakdown of iPhone applications, below, courtesy of 148 Apps, suggests that the percentage of downloads that one might find useful is somewhat higher than the 1% represented in Gizmodo's pie-chart.
See also:
In my opinion, there is no chance that it has peaked. Not only is the community constantly generating more and more apps (and downloads), but the community is only now beginning to figure out how to sort through them all.
Once a rock-solid third-party website comes forth that lets us find and share apps more effectively, the downloads and sales will climb even more quickly in the non-Fart categories.
I bought an iPod Touch for my boys at Christmas and I was amazed at how they loved it and use it more than Playstation Portable, PS2 and PS3. Things that traditionalists cite as disadvantages such as lack of physical controls doesn't matter in the slightest – quite the opposite, kids seem to love the touch controls. They now have more games than on the Playstations and it accelerates as they discover more and I get them because they are affordable.
Seems to me the App Store is going to explode in regard to sales
It's hard to see much on these arithmetically scaled charts. A constant rate of growth on these charts would be an upward curve.
On semi-log chart paper, a constant rate of growth would be a straight line. Then we could actually see what's happening. These charts still leave us guessing as to whether the growth rate has peaked or is still accelerating.
Well, what worries me is how cool Obama things his Blackberry is. Is he really that out of touch? Honestly, I was off for the weekend with a large group and the three iphones people had were the talk of the trip. Everybody wants one!
Best thing about the App Store: ANYONE WHO LEARNS TO PROGRAM FOR THE iPHONE LEARNS TO PROGRAM FOR THE MAC. And they discover that it's WAY easier than programming for Windows……
A statistcal peak is not the same thing as a flatline or a bottoming-out. The only thing the app store needs to do to continue to thrive is to keep people intereste. Facts and figures are nice; interest and buying are even better.
One thing is for sure. Once again Apple has done it and once again everybody else is following their lead, but slightly behind.
Apple announces mp3 players and the iTunes store. Everybody said what a joke. A year later everybody is coming out with an mp3 player ans an iTunes store clone.
An Apple touchscreen phone with a touchscreen keyboard. That will never sell. Now Blackberry announces the "worlds first" Blackberry touchscreen phone whatever that means.
Apple announces the app store and months later Blackberry and Microsoft have announced that they are going to open up their own app stores online. What a great idea.
Companies sure do save a lot on R&D by just copying whatever Apple does. Too bad that usually means they are a late to the party and the early bird gets the worm.
There's almost too many apps now. Who has time to look thru 15,000 apps?
It's all good though. Too bad regular macs don't have that many choices for apps.
Apple will eat android for lunch
Whenever I see a friend’s G1, i look for their great apps that i might be missing and you know what, they’re aren’t any, android is now fkd as everything is going to the Apple iPhone SDK and Apple iPhone traffic is up exponentially, week after week.
thanks for showing the way apple, your money making machine is about to change web 3.0 forever.
*Sorry for double-post, forgot to enter city/state info before hitting SEND.
Apple will eat android for lunch
Whenever I see a friend’s G1, i look for their great apps that i might be missing and you know what, they’re aren’t any, android is now fkd as everything is going to the Apple iPhone SDK and Apple iPhone traffic is up exponentially, week after week.
thanks for showing the way apple, your money making machine is about to change web 3.0 forever.
Elmer readily admits that his job is to bash Apple whenever he can. He is not an impartial journalist. It shouldn't be unexpected that he'll put a negative spin on everything Apple does. I've always joked that when he was a small lad, he was molested by a guy named Steve, who probably had a job, using an apple in an unintended manner.
ex ped: I admit no such thing.
Android will eat apple for lunch
Whenever I see a friend's iphone, i look for their great apps that i might be missing and you know what, they're aren't any, apple is now fkd as everything is going free or 99c so the developers don't bother and there's too much noise
thanks for showing the way apple but your money making machine has run out of juice
Wait, are they kidding? "1" Medical App?
A quick visit to the App store from my iPhone, which I'm using as we speak, shows no fewer than 151 Apps under the Medical category. These, too, are all some of the BEST Apps available, some of them nigh indispensable for people in the field already!
And the headline to this article IS what flashes across the RSS feeds, Google Finance Headlines, and other readers…not the pretty charts the depict the EXACT OPPOSITE of the headline's implication! Why pose such an absurd question in the first place? Name ONE bit of rationale for doing so when every indicator, ad by Apple, casual conversation with iPhone App users, developer conferences, video game conferences, and et. all, ALL point to the App store just getting started in its nascent stage? Even the pretty graph is trending exponentially UPwards…
ridiculous and indefensible journalism, IMO
ex ped: I'll forward your comment about the number of medical apps to 148Apps, which is where that stat came from.
ex ped (2): From 148Apps: Wow — I completely missed that. I wasn't grabbing the medical category for some reason. New category recently? Or maybe just one I hadn't noticed.
Grabbing it now — count will be updated within the hour.
Also note that most apps are in multiple categories — so even though
they are in the medical category, many will be in other categories as
well – Reference, Education, etc.
Dear commentator-charlatan-journalists,
There are a few of us who understand that there is no such thing as US journalism anymore, but only flashy infotainment. We also understand that the 'media' is paid by certain Zeitgeists to spin tales of woe and dread to the masses so that all control dumps into the hands of a few financial messiahs. And with each little stock tumble, you get another little pat on the head by your matrix lords, eh? The end joke will be on you when they leave you hanging with your tail between your legs. There are some of us who know this is a solid company and we'll hang on to the stock long through your end joke.
Tom, A.K.A. CAPS LOCK from Stafford, CT:
If you wrote your comment for a high school class, ANY high school class, you'd fail for the constant shouting, terrible grammar and inability to spell.
Those traits seem to be an accurate summary (not "summery") of your writing. Dolt.
Hi PED – The question was asked on a different forum, regarding the definition of a download. Does each app version count as a download? Or, is it only counted as the first download of a unique app?
An example to illustrate: I have about 15 apps on my iPhone. That would be 15 downloads. I have probably downloaded 60-80 updates, however.
I hope that it's the more conservative definition. That seems likely, with about 35 million or so iPhones/iPod Touches in use. That would be about 14 apps per user.
The Apple App store is just getting started. I've had an iPhone for awhile now and I just started looking at iPhone apps recently. The first thing my grandkids want to do when they come in the door is play with my iPhone (Light Saber, Lemonade Stand, Jelly Car, etc.). Some are free, but I've definitely bought some too.
iPhone apps are going to get very interesting.
Unbelievable article…almost as bad as the headline itself. There are 500 ways to spin the App Store in an appropriate positive light… and there are, as far as raw data, numbers, and actual user testimonies, close to ZERO ways to spin the story in a negative light. About the only true negative story is Apple's historical inability to approve apps fast enough…but this, ultimately, is a POSITIVE story for Apple..as that kind of quality control is exactly what differentiates it from the Windows paradigm.
Apple have the single best mobile Fart apps on the planet. Blackberry have none, windows Mobile OS have even fewer, and those are all result in a BFOD (Blue F*rt of Death).
Seriously thought…thank you for trying to hammer this stock for no good reason, it is creating amazing buying opportunities for Warren Buffet and the rest of those investors that are looking at actual data…something you had access to, and yet decided to effectively ignore in your articles passive aggressive stance and f*rtastic headline…
You should have a bad day on someone else's dime and stop leveraging your position to further the FUD already surrounding this amazing stock..and more importantly, the company itself and its dedicated employees and shareholders.
I'm a fan of PED's articles, but i am in the corner of those who say the title is misleading. You are better than that Philip.
All the writer (so-called) had to do to make the headline match the article was to add one more word, suitably punctuated:
Apple’s App Store: Has it peaked? No!
ex ped: I like it. Done.
Fortune's Philip Elmer-DeWitt: Has he peaked?
Formula: Say ANYTHING in a title to get people to read my drivel.
"to break down Apple’s 15,000-plus iPhone apps into eight categories"
No, you're disgustingly wrong in this sentence – this isn't a breakdown of the 15,000-plus applications offered, it's a breakdown of the 500 million applications downloaded. Writing good, factual articles requires skills in reading and understanding, too.
ex ped: Yikes! You are disgustingly correct. Fixed now. Thanks.
To help out the other people who have made the shrewd observations about the title of the article.
Journalists have learned another web technique. It's called Trolling, the journo is a Troll and you may see people asking you to not feed the Trolls. This is such a case, let's not feed this troll.
Headliners are now being used that way, its a trend and it will get worse as the journo's try to stay hip.
@ John Malvo. No, I started with a few free ones, then a few cheap ones, now if it's 99c USD, it seems like something I might want and the reviews are good, or even if there are none, I'll just buy it and see, then review to advise others.
The thing that is not being journalised is what the AppStore is actually doing. Not how many it is selling, but how the process of build to buy and its cycle is changing. The AppStore has changed software development forever.
6 months and not one of these tech journo's has even caught on, clueless.
Here's a parallel for you. People used to slam the Mac because there weren't as many applications for it as there were for the PC. What people failed to note was that most PC apps were crappy or duplicates of each other. Still, it became a marketing bludgeon to keep the Mac down, so to speak. Now Apple has a platform that is in the PC's position, with lots of available applications as well as momentum. And suddenly people are pointing out this inherent flaw.
If you want to make this argument about the iPhone/iPod Touch/App Store you should also apply it to the Windows PC. I suspect people will still find that their PCs are useful tools in spite of the mess in the application space. Just as they'll continue to find the App Store useful.
ELMER IF YOU WROTE THIS FOR A HIGH SCHOOL JOURNALISM CLASS IT WOULD BE A C-. YOUR HEADLINE AND BODY HAVE NO CONNECTION. A HEADLINE IS SUPPOSED TO GRAB YOU AND PULL YOU INTO THE BODY OF THE WORK AND TIE THE SUMMERY BACK TO THE HEADLINE. YOU ACTUALLY GO BACKWARDS.
THE WORKING TITLE SHOULD FIT THE FOCUS OF THE COLUMN, MORE LIKE
"APP STORE GAINING MOMMENTUM FOR APPLE"
OR
"500 MILLION DOWNLOADS CAN'T BE WRONG"
OR
APP STORE BUILDING ON STRONG GROWTH"
YOU TITLE THIS AS THE PEAK OF GROWTH YET OFFER NO EVIDENCE TO SUPPORT IT.
YOU CONTRIDICT YOUR OWN THEORY AND THEN SUMMERIZE IT. POOR WRITING, BAD ANALOGY,DUMB ECONOMIC MODELING. YOUR OWN CHARTS SHOW NO LET UP IN SALES NO EVIDENCE OF PEAKING, IF YOU ARE TRYING TO SHOCK PEOPLE YOU DID, BY PROVING YOU CAN'T WRITE A FINANCIAL COLUMN.
ex ped: One thing I have learned is how to turn off the caps lock key. And for the record, the headline does not say that App Store growth has peaked. It asks the question, which the article endeavors to answer.
Has it become Internet decorum to make sure the title of the article has nothing to do with the article itself?
CNN and Fortune are not alone it this, it appears to be a widespread behavior.
Why do all you reporters always have a NEGATIVE twist on your stories.
Has the Apple Store peaked? How about…Apple Store reaches 16,000 apps!
All I see from you guys on Apple is regative reports. Here is a company and ONE OF THE ONLY COMPANIES IN AMERICA that is not a bunch of B- – - T and is turning a profit and has 25 billion in cash and their earnings beat estimates every time! You guys should be falling over backwards over a company like this.
Meantime, GOOGLE, which is a joke of a company, is worth 4x more, revenues are down, they are firing people, their main source of income is going away and people will not pay those prices anymore, etc and you aren't reporting on that? Google is a facade…it's just like Yahoo 10 years ago. Go start reporting on them and research it. You'll be surprised how much Goog is nothing more then word of mouth and their isn't much substance to their company.
Goog is basically a bunch of tech kids not ready to come into the real world..it's about to hit them hard. No more free lunches, laundry, bonuses, etc. Google is a company set to fall hard.
Not Apple.
I started paying for applications that I want. Looking forward to others and will continue to purchase if necessary. I think the trend will continue as long as developers have new apps to offer. The author appears to be just another PC guy with nothing positive to write about anything associated with Apple.
Here is a different thought:
If the point of the iTunes store is to sell more iPods, then maybe the point of the App store is to sell more iPhones and Touches.
Why not compare App sales to iPhone/Touch sales, and tell us if the strategy is working?
Did I read past the jump? What for gems like.."Of course, none of these numbers will mean anything if the fad passes and users decide most of those apps aren’t worth the cost and trouble"
Its not a fad, its negative bias.
Wow, I guess they don't teach how to write headlines anymore. Or more likely, the author never went to school.
This story misses the point altogether. It's not how many apps are DOWNLOADED, it's how many that are SOLD! What should be considered is the revenue generated by the App Store, since the free apps are actually a cost to Apple (although it can be argued that they are a necessary loss leader to attract people to the store).
Personally, I started out using only free apps. Now, that I have gotten comfortable with the quality and the process, I am started to shell out real money for other apps. Is this a trend that is happening for everyone, or am I just an outlier? This is the story that will let people know how the App Store is really doing. Now, go ahead and write it, Phillip.
Hi PED: Is there any reliable source that has provided an average sales price for the 500 million apps that have been downloaded, and not just the average sales price of all available apps?
I would like to know the revenue of these 500 million. If the initial reports of a $2 average app price are correct, we are talking about a cool billion in 6 months.
ex ped: When the App Store hit 300 million downloads, Dan Frommer of Silicon Alley Insider estimated Apple's take was somewhere between $45 and $90 million. (See here.) He hasn't issued a new estimate, but if all else remained equal, Apple's revenue at 500 million downloads would be somewhere between $75 and $150 million.
I don't mind if only 1% of the apps are really useful. Useless apps don't detract from good ones such as Evernote. There will always be publications and sites to point us toward the good stuff. The number of useless of pc apps doesn't make Excel look any worse.
Hey! The next article could be "Is the App Store COSTING Apple Money?"
That will bring in the saps!
The App store is fantastic, and will only get better! The Gizmodo dopes are not serious . And the fact that there are a lot of games is GREAT, as it was a selling point for the iPod Touch. Also, all those years when people compared Macs to Windows it was common to hear how there were "so many more" software titles for Windows. Remember that?
Well, most of those titles were games!
It never ceases to amaze….your negative bias on AAPL is overwhelming. The App store HAS revolutionized the mobile phone business. Everyone is trying to ape them (and failing) but you must find any possible negative spin to put on it.
ex ped: Mark, did you read past the jump?
Has it peaked? I think not. We're now at 16,697 apps. It goes up 250+ per day some times.