iTunes Developer Payout Estimated At $2 Billion

Anyone who’s questioned Apple’s generosity in the past might want to take a look at some new calculations.  Granted, the company’s market cap is in the neighborhood of $320 billion, so it hasn’t gone broke giving cash away, but one analyst thinks Apple’s paid more than $2 billion to app developers.

Horace Dediu based that conclusion on two assumptions: “Average selling price per app $0.29 (as reported in June 2010 here)” and “App gross margin 30%.”

Then he observed, “When comparing sales acceleration, the App store is ramping faster having paid out $2 billion in 31 months vs. 34 months for the first $2 billion paid out for music.”

So Dediu predicted, “My guess is that a follow-the-money analysis would show that apps as a medium will absorb talent and capital away from existing mediums and the industries they support.”

That’s a pretty bold statement, but when $2 billion is at stake, all sorts of strange things can happen.  App developers should perhaps be pleased to be in such a hot industry, while at the same time try harder to stay competitive.

Categorized as Apple Tagged

By Doug Caverly

Doug is a staff writer for WebProNews. Visit WebProNews for the latest eBusiness news.

Leave a comment