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January 05, 2015


Crun Kykd

I bet you can get a black and white TV for $10 today. Except no one makes them anymore. Same with a $10 iPhone-class device in 2020.


It is ridiculous to think that the only way to get paid as an app publisher is by selling it in the app store.

Agree, but some here are blind to business opportunities, some were discussing the Apple watch and the many doors it will open but you have to step in first, the discussion went on focussing in "I don't wear a watch therefore it is ridiculous to consider it", not even a doubt, all negative factors why not to do it emerged fast, it's like some people come here just to show how clever they are at NOT finding any reason to do something just 'cos they hate brand A or B

Also the Apple store in just one channel, there is google too, if we follow Tomi's logic soon it must be 4 times the size of Apple's store. People fail to realize that the app store is just another channel to make business, some companies I work with develop and implement apps for their clients at nice amounts of money, and then there is the service and maintenance on top. Many of those ideas become products in one way or another. The app store for many is an extension to their business.

For others is an opportunity that didn't exist a few years ago and now its worth billions in pay out and what do you hear ? Ahh those small billions, bah! if we were to use their logic and understanding of how it should work to be profitable for millions of developers we should think also that there should be 100 googles, 100 facebook, 100 OS.


@Baron95 & Gonzalo:

You tend to ignore what others say, if you can keep a fruitless discussion going. The discussion had solely been about revenue directly created from an app store. That was the $10 billion that was being discussed.

Nobody ever denied that services that use an app as an interface can be a viable business. On the other hand most of these businesses do not depend on apps, they also have other channels of revenue. In fact, for most developers this is the ONLY way to make a living.

Just stop hailing the $10 billion paid out by Apple and the $5 million paid out by Google as something worthwile. That money won't do any good, except for Apple and Google and a handful of larger game development studios.



"You tend to ignore what others say,"

This same seems to go for you too. You ignore all the comments about how it's even worse for the big players to take most of the profits if the apps are compared to the books, music or movies. You also like to focus on that $10 Billion and only rarely mention how it's just a small part of the money generated from the apps for the developers.

Another thing you almost completely ignore is the growth rate of the apps industry. It grew 50% last year and still you ignore that. What will happen if it keeps growing at that rate for few years?

Tomi T Ahonen

On the App Store news

RottenApple had it correctly here in the responses. Like we see in the big App Store blog - I prefer you argue the app store economics issues there - but yes, as we can CLEARLY see from the App Store economic blog I wrote, the facts are OBVIOUS that only a few make profits. This is not like 'hits businesses' like Books, music, movies etc - where about 1 in 10 is a hit product. in apps its nearly as bad as 1 in 100 (I think the math was 1 in 85 or so?). This is not an industry, its a lottery. A few hits make MASSIVE money and nobody else survives. Nearly 98% of app developers do not make a profit. It is not a SUSTAINABLE business (for now) and not until 3/4 of the app developers recognize it was hopeless and they quit. And the various silly brands who thought that creating an iPhone app was 'a mobile strategy' they all learn that SMS, MMS and mobile web is the way to reach consumers - they too will increasingly quit their investments in apps, which will cull the 'employment pool' of the mercenary app developers who make apps for brands. It is a hopeless industry EXCEPT for gaming. And because the gaming allows super-hit titles like Candy Crush, Angry Birds, Clash of Clans etc who will make millions, there remains the myth that apps can make you rich. It can't. And the truth is coming out, started to come out in 2014 and will be very loudly said in 2015. Apps are hype, we are past peak apps. Its no economy except for gaming.

So whatever you argued about games in any responses, if that argument suggested that 'apps will provide growth' in any way, that is an invalid position. Period. Apps are a dead industry (except for games). That Apple paid $10B is irrelevant, that was almost all paid to gaming companies and what was left after gaming revenues won't sustain the business of an outside toilet. All arguments about app store 'success' in THIS THREAD are now moot and forbidden. Take the to the app store blog. This is SILLY to claim there is a sustainable business in apps when the FACTS clearly show there isn't and now most experts in apps say so. Lets not be stupid in the comments!

Tomi Ahonen :-)


Where is the source proving that about 1 in 10 is a hit product in Books, music, movies etc? This was never explained in the original apps post.


That's one of the criticism of the original apps post. Other was that even if those numbers are valid, how does it differ from making a web page?
Even smaller percentage of web pages turn into a hit.
Similarly few top pages (Facebook, Google, etc.) gather most of the use and most of the profits.
Similarly some web pages make big bucks behind the scene, web page is just a viewer for the actual service data.
And what comes to making money via ads... Some people make living maintaining a popular webpage and get the money from ads. But big ones (Google, Facebook) make the most.

Tomi says app craze is over and everyone should understand that there is no money to be made in apps. If it is so, there is no money to be made in web pages.

That's where the discussion was left, I think. Go check. ;)



"Other was that even if those numbers are valid, how does it differ from making a web page?"

A simple matter of work hours and cost involved. Making apps is a very time consuming process. Web pages can virtually be tested while they are designed and gradually added upon. For apps that's not so simple. In addition you got the browser's framework to take care of a lot of work that an app needs to do itself.

It's also far easier to update a live website. If you want to update an app you need countless hours of QA before you can resubmit.

The entire process of creating a web site is different. At the beginning you can easily skip a lot of the fancy stuff and concentrate on just making it work. Once it works, you can do the fine tuning.
But if you try to make an app like that it's very likely that it will fail due to low ratings in the app store. You normally don't get ratings when you click the link to a web site.

And last but not least: If you want an app, you still need the web site for all those who happen to not have a supported smartphone or just want to use it from a different type of internet accessing device.

The bottom line simply is that most apps are redundant vanity projects that have no reason to exist, except for falling into the 'we need an app'-hype trap.


@John F.
Both the web and the App industry are service interfaces. A web site is a "place" where a company helps a client achieve some goal. The same for a mobile app. This service is the actual product. It is the qualities of the service that determines the success. The web site or app is just a UI of the service.

Obviously, designing and building good UIs can earn you good money. But that is not the real product users "buy".

Games are among the few exceptions where the App actually is the product.


@Winter (Jan 7)
> In short, unless those bickering about "Moore's law will end" come up with some solid evidence that that is going to happen before 2020, they are just sore losers.

The brick wall facing Moore's law is that atoms aren't getting any smaller. That places a hard limit on the size of chip features. Another challenge is the lithography, ever-shorter wavelengths of light are needed & fabrication technology is ever more expensive.

It is clear that the hard barrier will not be reached by 2020, what is not so clear is how much the increasing R&D costs will have hurt price-scaling by then and whether or not progress will have slowed. But I do think the sheer volume of mobile phone chips will mean that this is the area that is best placed to absorb the R&D costs needed for future die shrinks.

However notzed has made the most convincing argument as to why a $10 smartphone may never happen - the patent-licensing costs. I'm surprised there hasn't been more follow-up discussion of that point.



"However notzed has made the most convincing argument as to why a $10 smartphone may never happen - the patent-licensing costs."

Mostly agreed. The question is, how many new patents will have to be licensed in 2020 and how many essential patents have expired since then - and of course whether the insane patent laws as they exist now get some of their teeth pulled.


actually moore's law says nothing regarding price

abdul muis

EE just announce the £49 phone.

The Rook runs the latest Android 5.1 Lollipop operating system, and features a 5 megapixel camera, a 4” high resolution FWVGA display screen and 8GB internal memory, all powered by a fast and energy-efficient 64 bit MediaTek® 1GHz Quad-Core processor enabling faster web browsing, smoother game play, quicker multitasking and further improved battery life. The Rook also comes with a 1,500mAh battery, which is good for over five hours of talk time and over 400 hours stand-by-time on a single charge.

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There was limitation in Moore law

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