Where the Money Is

by Dave Schuler on March 5, 2013

I stumbled across the graph above and found it interesting. It ain’t the Apples, Motorolas, Samsungs, or app developers of the world that are making the big bucks from the mobile device gold rush. It’s the operators—the ATTs, Verizons, and so on.

I expect the complaints about the operators to start mounting to the point where political pressure is re-applied.

Update

The total sales of all of the hundreds of thousands of apps is estimated to be around $7 billion in 2013. I’ll leave it to the interested reader to place that on the graph above.

I was going to write a post on this subject a while ago, did the research, and never got around to writing the post. Most apps don’t even make back their cost of development.

{ 9 comments… read them below or add one }

PD Shaw March 5, 2013 at 3:44 pm

And about $3 billion of apps revenue is from Apple, which just had to disgorge an estimated $100 million for deceptive practice related to how easy it was to move from freeware to pay. Clearly a long-term problem with financing game apps. And parents do pick up stories about kids running up $1500 on a “free” game and become less trustful overall.

PD Shaw March 5, 2013 at 3:46 pm

BTW/ I am confused by that entry for “PC Sales.” Does that include traditional desktops, even if they are not hooked up to any wireless network, or is it only netbooks or laptops designed for mobile use?

Dave Schuler March 5, 2013 at 4:13 pm

Since total U. S. PC sales revenue was about $85 billion and worldwide about $300 billion in 2011, I’m assuming that’s all PCs—desktops, notebooks, etc. Not tablets or smartphones.

PD Shaw March 5, 2013 at 4:47 pm

Thanks, I suppose I could have done a little research, but I don’t have any “feel” for where the money goes. I knew PCs were not as hot, but they seem to work on a planned obsolescence model that requires replacement now and then.

Trumwill Mobile March 5, 2013 at 6:14 pm

What pressure do you see being applied?

Dave Schuler March 5, 2013 at 6:26 pm

Constituent complaints, Congressional hearings, regulator mau-mauing.

Dave Schuler March 5, 2013 at 6:30 pm

they seem to work on a planned obsolescence model that requires replacement now and then

My impression is that hasn’t been the case since XP. Right now XP and Windows 7 have roughly equal “market shares” (I’d call it “installed base”) with Windows 8 lagging far, far behind and various versions of Mac OS and Linux behind that.

There may come a point when device drivers stop being available for XP (or Windows 7) but that time is still in the future.

Trumwill Mobile March 5, 2013 at 6:48 pm

Sorry, I didn’t say what I meant. I meant, apply pressue to do wwhat?

PD Shaw March 5, 2013 at 8:00 pm

@Trumwill, I think this is where Dave is coming from:

http://theglitteringeye.com/?p=19254

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