Mark Gritter (markgritter) wrote,
Mark Gritter

App market numbers don't add up

The STrib ran this (national) piece on the mobile app industry: Mobile app industry takes flight. One of the claims is that mobile apps have been responsible for about 500,000 jobs. This seemed high to me. The article also claimed mobile app developers were earning $90-130K next year. Even $100K average would mean $50B in payroll, which seems too high.

I don't know a source for good public numbers on the app market, as most reports are very forward-looking. $25B for 2012 seems reasonable. However, Apple, who is a clear market leader, pulled in about $1.9 billion for all iTunes sales in the 3rd quarter, which is compatible with a $25B market. (Their take is 30% and they have about 70% of the app market, but apps aren't all of iTunes.)

There are various possibilities. It could be that most app developers (particularly independents) are satisfied with a far smaller income. Or, it could be that app developers are losing money as a whole (perhaps funded by VC money in anticipation of future growth.) Or, the 500K jobs number is fundamentally bogus, either inaccurate or double-counting.

For comparison, Zynga has ~3000 employees at about ~$300m quarterly revenue. $400K revenue/employee is in line with other tech companies. But if the industry is as successful as Zynga, on average, then that would be less than 100K jobs.
Tags: apple, economics
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