How Large Is the Apple App Store Ecosystem?
ANALYSIS GROUP
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1
When Apple opened the App Store in July 2008, it was the first of its kind. With the App
Store, Apple provides developers with distribution, search, and validation services, as well
as a set of tools to build and monetize apps. Originally offering approximately 500 apps for
the iPhone and iPod touch, the App Store has grown to distribute millions of apps for the
full suite of Apple devices (iPhone, iPad, Apple TV, Mac laptops and desktops, and Apple
Watch) in 175 countries. Cumulative downloads are in the hundreds of billions.
1
Earlier this year, Apple reported that earnings it has paid to app developers who sell digital
goods and services through the App Store or within their apps totaled more than $155
billion worldwide since 2008, with a quarter of those earnings paid in 2019. Such direct
monetization through the App Store occurs through paid apps and digital content or
services obtained using Apple’s in-app payment system.
While such direct monetization of apps is substantial, it significantly underestimates
the size of the Apple App Store ecosystem. This is because developers can choose to
monetize their apps in different ways, including several that do not involve transacting
directly through the App Store. These other monetization strategies include selling digital
goods and services outside of the App Store that can be used within apps on Apple
devices (such as streaming apps), selling physical goods and services (such as grocery
delivery apps), and offering ad-supported content (such as social networking apps).
Study Goal
The goal of this study is to capture total billings and sales generated through app
developers’ various monetization strategies.
2
In other words, our purpose is to estimate
total billings and sales facilitated by the Apple App Store ecosystem.
3
Our study accounts
for billings generated through direct monetization via the App Store and sales generated
through monetization outside the App Store.
4
Our analysis focuses on third-party iPhone and iPad apps
5
in 2019, the most recent full
year at the time this report was prepared. The coronavirus pandemic has dramatically
impacted the mobile economy and the app ecosystem. More consumers are turning to
apps to make purchases and to stay informed, connected, and entertained. While our
primary results focus on 2019, we briefly discuss the pandemic’s potential effects on the
app ecosystem at the end of this report.
1 App Annie, The Data Behind 10 Years of the iOS App Store, 2018.
2 We use the term “billings” to refer specifically to payments generated by paid downloads and in-app purchases
(including subscriptions) that use the Apple in-app payment system, and the term “sales” to refer to money
spent by customers purchasing goods and services in general.
3 We use the term “facilitated” to include the various ways in which apps contribute toward generating billings
and sales. We describe these different mechanisms for generating billings and sales below.
4 The following apps and associated billings and sales are excluded from this analysis: apps developed by Apple,
such as Apple Music, and mobile browser apps such as Google Chrome or Safari.
5 Apple TV apps are also included in our estimates of usage and engagement for video streaming.
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