The iPhone isn’t the only way for mobile app makers to make serious money. Windows Phone may lag behind the Android and iPhone app stores, with 60,000 apps rather than 400,000 and half a million respectively, but a handful of developers say they make more revenue from Windows Phone apps than on other platforms. The number of PlayBook users is modest compared to the 75 million BlackBerry users, but RIM tells us that the top earners in BlackBerry App World are PlayBook games. In general, iOS and Android is still where the money is – but the money-makers aren’t always what you expect.
Apple app development: billions for developers
The first appillionaires, as the book about unexpectedly successful smartphone apps dubbed some developers, made their cash on iOS. Last summer Apple said users spend as much as $250 million in the App Store each month, buying over 10 billion apps so far and that’s made $2.5 billion for developers (after Apple’s 30% cut of revenues). Analyst Gene Munster of Piper Jaffray estimated that would rise to $3.46 billion paid out to developers by the end of 2011.
There’s a lot of competition for the cash though; that’s shared between some 79,000 registered software publishers who are creating a lot of high-quality apps and you need to be good to stand out. If you do, the rewards are high. If you’re a top-tier developer for the iPhone, especially if you have a popular game that supports in-app purchases for virtual goods or extra levels, you can make anything from $1 million to $3 million a month.
The iPad has replicated the app sales success of the iPhone; the developers behind World of Goo found that their iPad version sold faster than on the Wii or on the Steam games platform. But Android also offers opportunities for developers to cash in.
Android app development: in app
Russian developers Game Insight regularly shows up on list of top-grossing games on the Android Market, although that doesn’t include apps that make money from adverts. Google doesn’t give out much detail about what Android developers make but Game Insight has claimed revenues like $640,000, and in one case, $1 million a month for a particularly popular Android game. For comparison, Game Insight says it made $300,000 from its My Country iPad game in the first two and a half weeks it was on sale.
Other games companies who have apps on both platforms say Android revenues have generally been lower –anything from a fifth to a tenth of the profits of iOS games – but that they’re increasing significantly. By the end of 2011, game maker Glu Mobile was seeing 30% of its revenues come from apps on Android (with the other 70% coming from iOS). A small number of companies say they make more money per user on Android, especially for in-game purchases.
That’s why Munster’s estimate that Google has only paid developers $240 million so far isn’t the whole picture, because a higher percentage of apps for Android are free than on iOS. Estimates vary but just 1.3% of Android apps are paid for by Munster’s reckoning, compared to 13.5% in the App Store. Given how many of the top-grossing appson both platforms are now free and making their developers money from in-app purchases and ads, revenue share from application stores (which is uniformly a 70:30 split with developers) could soon be eclipsed as a way of making money on phones. App tracking experts Distimo estimates that in-app earnings already account for 48% of App Store revenue and 65% of Android market revenue.
Games may be a special case for Android, though. Distimo’s figures show (above) that if you look at the 200 highest-grossing apps on each platform across all categories in 2011, both the iPad and iPhone App Stores beat the Android Market and the iPhone App Store generates four times the revenue of Android marketplace. That means that despite the huge growth in Android devices, most Android apps are still not making the same kind of money for developers
BlackBerry app development: Small but profitable
The good news for BlackBerry developers is that while they have a smaller market of users to sell games to, average selling prices of BlackBerry apps are much higher than the 99 cents that’s become common elsewhere. Last October then-CEO Mike Lazaridis claimed that “developers make more money on BlackBerry and they do it faster”. Back in 2010, BlackBerry developers were making between 20 and 40% more money than iOS coders from a paid app, according to one estimate.
And while Android has the lion’s share of ads served on mobile, it doesn’t make developers the most money from ads. The argument over whether Android apps built with the Apperhand SDK are malware or just aggressive advertising underlines the fact that free apps with adverts in are lucrative. And this is one area where Windows Phone really stands out. In Smaato’s survey of mobile advertising worldwide (below) in the third quarter of 2011 (, a higher proportion of Windows Phone users click on the ads they see than on any other platform (ahead of Symbian, BlackBerry, iOS and Android users, in that order).
That backs up what we’ve heard informally from several developers; hobbyist developer Alex Perez found that in the first five days that his game was available it generated four times more ad impressions on Windows Phone than on Android – and he made ten times the money on Windows Phone. Over the first month, that changed to ten times as many ad impressions on Windows Phone and thirty times the revenue. And while the profits are still modest, over the course of 2011, he saw ad impressions and revenues double every month
Even though there’s a wider range of ads and more advertisers on iPhone and Android (and even on BlackBerry) – according to mobile ad network Millennial Media, Android gets more than half of all mobile ad impressions and iOS has around a quarter – ad-supported apps are likely to make more money per user on Windows Phone. As the market shifts from paid apps to free apps with ads and in-app purchases (something Windows Phone doesn’t yet support), that could keep the platform attractive to developers who don’t want to be lost in the crowds the way they can be on other platforms.