Tuesday, January 20, 2015 [Tweets] [Favorites]

The Shape of the App Store

Charles Perry (tweet):

I expected a “hockey stick” curve that’s characteristic of power law models, but I didn’t expect one like this. The hockey stick breaks upwards at around position 870 on the U.S. Top Grossing list. With about 1.2 million apps in the App Store at the time the data was collected, that arguably puts 99.93% of apps in the “long tail” of the App Store. The “head” of the App Store, those 870 top grossing apps that make up 0.07% of the App Store population, collect over 40% of the App Store revenue that’s paid out.

Luckily, there’s a lot of money to be made in that long tail. At the top of the long tail, in position 871 on the U.S. Top Grossing list, an app still makes over $700 in revenue per day. That’s almost $260,000 per year. Even number 1,908 on the U.S. Top Grossing list makes over $100,000 per year.

His chart is based on the sales data from Marco Arment.

Filip Radelić:

Seems like a very optimistic approximation. I’ve seen apps around top 870 grossing with much, much less than $700/day.

Charles Perry (tweet):

I’ve gotten some feedback from readers asking how valid my extrapolated data is. Some have pointed out that I’m working with a limited data set from only one app that might not hold for all apps.

[…]

While the the exact revenue figures that I cited in The Shape of the App Store may be off little, it seems likely that they are at least in the right ballpark. They may even be somewhat conservative estimates if Manual’s revenue figures are to be believed.

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