Chad Catacchio is a contributor writing on a variety of topics in tech. He has held management positions at a number of tech companies in th Chad Catacchio is a contributor writing on a variety of topics in tech. He has held management positions at a number of tech companies in the US and China. Check out his personal blog to connect with him or follow him on Twitter (if you dare).
According to calculations done by analyst group Piper Jaffrey and reported by Fortune, Apple’s App Store has only accounted for 1% of Apple’s gross profit since it launched, or only $189 million (of course, we could really only say only when talking about the second largest corporation in the US by market cap).
By using the 5 billion apps downloaded to go along with the US$1 billion that has gone to developers, Piper Jaffrey calculated that the App Store has brought in $1.4 billion, and after Apple’s 30% cut (with 70% going to developers) they’ve brought in $429 million in revenue since the App Store launched, or 12% of what iTunes has brought in in that same time period.
One thing that the report didn’t seem to address (at least from the Fortune article) is how much Apple has made from its homegrown apps so far, especially from iPad apps such as Keynote and Pages. Although its hard to argue that app are really there so that Apple can sell more devices, Apple is also increasingly moving into more ways to get higher margins, not only with their own apps but also now with advertising with iAds. Of course, Apple isn’t only a hardware manufacturer, so flushing out their homegrown margins in their iOS platform was bound to happen from the day they launched the iPhone.
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