Posted on Jan 2, 2012 in Weblog | 0 comments

Chris Stevens’s book Appillionaires chronicles the explosive growth of Apple’s App Store and dives into the background behind popular, successful apps like Angry Birds and Doodle Jump. The book doesn’t cover the Android app landscape at all, nor does it cover any of the other application stores (e.g. Microsoft’s Windows Marketplace or the Mac App Store). And since it focuses on popular apps, it only primarily covers indie game developers who have struck it rich, not on applications like productivity office suites or medical apps. However, it’s a great glimpse into this cutthroat industry.

Some facts I’ve learned:

  • A huge part of Apple’s success is that it’s not tied to the behemoth cell phone industry, which churned out crappy phones like the Motorola Rokr and forced customers to buy from their equally-crappy software stores. The success is also because of low entry requirements of just $99/year for developers, allowing independent developers to be “put on equal footing with large corporations.”
  • The “real expense is the investment of your time” or on salaries. He notes that “the average iPhone app costs between $15,000 and $50,000 to produce — not including marketing. … To pcreate a productivity app, or a game, is significantly more expensive.”
  • “The most cynical estimate is that the median app makes $682 per year.”
  • “The majority of consumers buy apps based on the promotional banners Apple runs on iTunes, or by scanning the top-ten list. If an app is not visible in either of these places, it’s very hard for the developer to generate any sales.”
  • “‘Lower your price, lower your ratings… Lower ratings, lower social proof. Lower social proof, lower sales,’” one developer wrote. Apparently, more customers complain about the worthlessness of your app if you price it at 99 cents; bad reviews actually disappear at the $1.99 and higher price point.
  • “Over $250 million is spent at the Apple App Store” every month.

…and very interestingly, the author thinks that the future of apps hinges on the behavioral sciences:

One study suggests that “we do in fact respond very positively to crude graphical events — regardless of whether these graphical events signal a positive or negative software behavior. … it turns out that we still get quite a psychological thrill from flasihng lights, an exciting noise, and bright colors. A 2005 study by M.I.N.D.Lab/CKIR…monitored the facial EMGresponses of people playing the videogame Monkey Bowling 2 and discovered that humans experience a sensation of joy when confronted with a visually exciting event in game… facialEMG monitoring could be used to assess the appeal of future games” to measure sensation-seeking.

This book, overall, provides some insight into the games industry, but unfortunately is more a series of case reports and doesn’t provide prescriptive details or recommendations for those who want to create successful, high-grossing applications. Analysis based on financial data is scant, although the book paints a great picture for those interested in the business strategy of things. It’s a fairly quick 3-hour read while in the bookstore.