Apple Anti-Trust (was Apples actual response to the Flash issue)

Richard Gaskin ambassador at
Tue May 4 12:14:05 EDT 2010

David Bovill wrote:

> Richard and others have made this point - but I think the figures are
> misleading. From memory there are two figures that stick in my head - and it
> would be great to have them discussed, trashed or verified on this list :)
> First that 97% of mobile app revenues are on the iPhone - this one I find
> hard to believe, though I can also understand how this could be possible.
> I'll dig out the bookmark I have for that one if it proves to be
> controversial :) Second that 80% or there abouts of mobile phone web
> browsing of sites are from iPhone users - that one was from Mr Jobs KeyNote
> - but there could be some independent source somewhere - again I can
> understand why that may be the case - it is one thing having a phone that
> can send MMS or browse the web in theory, and another to get users actually
> to use the stuff, or better still actually pay for it (in terms of app or
> media purchases) - iPhone OS is leagues ahead of everyone at the moment on
> these fronts.
> The figures that indicate the real battle are the projected ones and the
> ones that refer to the (very) recent growth of Android - these are promising
> but not yet solid.

Yet.  So much hinges on those three letters.

I don't think the market share stats I quoted from Computerworld/WSJ are 
any more or less misleading that others (for those that missed it 
they're here:

Stats are both rewarding and challenging because the different 
methodologies used provide different views into the data.  And like any 
study of macroeconomics, there will always be disagreement about what 
they mean. :)

Given the variety of projected outcomes from these various 
methodologies, from "iPhone will rule the world!" to Gartner's 
suggestion that iPhone OS will be overtaken by Android in under 24 
months (see 
I think it's prudent to take them all into consideration.

It's true that the Apple audience in general, and particularly the 
subset of that audience that are early adopters of new technologies, 
tend to spend more on related third-party products like apps.  Being a 
sort of "boutique" vendor with high margins and focusing on quality over 
affordability, Apple has a solid niche that has earned it tens of 
billions in retained earnings, even with its 10% desktop share and 24% 
mobile share.

Consistent with this, while Apple has a 10% share on the desktop most of 
our products make 25% of their revenue from Mac sales, two and half 
times greater per capita than we get from the Win market.

But that is per capita.  As more capita come on board, the totals change 
dramatically.  Not everyone drives a Volvo, but everyone needs tires.

So for us app developers, another useful metric is app revenue.  But 
even here we see some variance when it comes to determining what these 
numbers mean.

Consider this attention-grabbing headline:

Estimate: Top 1000 iPad apps making $372k a day

That sounds like a gold mine!

Well, kinda.

If you examine the underlying math, it paints a picture we could 
politely call "mixed".

The crux of the numbers comes down to this portion of the article:

    By their reasoning, the top paid app in the store sells
    about 5k copies per day, with the number two app selling
    about 3k, the number three app about 2.5k, and so on.
    Vimov estimates that everyone in the top 100 list, when
    you add them all together, is making about US$304,058
    on any given day. The shelf drops off from there -- in
    the top 1000, developers are making about $372,000, and
    past that, they're obviously making less.

If I read that right, here's the breakdown:

The top 100 are collectively making $304k/day and the top 1000 are 
making $372k/day, which means that those who are in the top 1000 but 
below the top 100 (the lower 900) are collectively making only $68k. 
Split that among 900 apps and that's $75.50 per app per day.

And then there are the other 180,000 apps. With the top 100 collectively 
making $304k and the next 900 making $68k, at that dropoff rate we can 
expect the second best-selling 1000 apps in the AppStore to make about 
$17k split among them all, and the third best-selling 1000 to make about 4k.

Then it goes down from there for the other 150,000 apps, ranging from $4 
per day per app down to zero.

Meanwhile, the current minimum wage in California is $8/hr. In an 
eight-hour day a worker with very few skills can make $64. :)

So while an Apple advocate could say "iPhone OS deployment will make you 
rich!", a naysayer could say, "You can make more money flipping 
burgers".  :)  Same math, different perspectives.

While the iPhone OS is attractive to me and my clients, as is Android 
and the rest of the mobile market, I have to acknowledge that my desktop 
apps -- where I'm able to use a high-level tool like Rev to deploy at 
much lower cost than I would incur using Objective-C -- make a lot more 
money every day than every iPhone app below the top 100.

And compared to the average, my desktop apps are pulling in several 
orders of magnitude more money that most iPhone apps, certainly more 
than the bottom 150,000 App Store offerings who make next to nothing.

Which brings us to this point:

> Like a few others on this list I am now pretty convinced that the PC market
> is about to be dramatically overtaken by the new mobile market in terms of
> sales and new software developments. Apple and others will be quite happy to
> leave the desktop market to the web and to open source strategies - they
> simply will not be interested in closing this market - let Google have it.

As a shareholder, I hope not.

For all the attention mobile devices are getting as The Next Big Thing, 
this survey suggests a role that's more complimentary to the desktop 
than a replacement for it:

     Survey finds 16GB iPad 3G most popular, not viewed as PC replacement
     Similar to Um's survey of iPad buyers for the Wi-Fi-only launch
     on April 3, most -- 94 percent -- said the iPad will not replace
     their computers. Most said they will use the device for Web
     browsing, media content viewing and other personal entertainment.
     Only a handful said the primary use of the device would be for


I see phones and tablets as only a beginning of an increased diversity 
of the computing ecosystem, in which we can also expect heads-up 
displays to play a role within a year or two.

In the organic ecosystem, we didn't see reptiles disappear when mammals 
came on the scene, but instead saw a greater proliferation and variety 
of them both.

I see the same for computing:  When I was a kid the word "computerized" 
was used fairly commonly, but now even our cars have a PPC processor in 
them and everything is computerized, so the word has lost its usefulness 
as a distinction.

So now phones have computers in them too.  Next will be refrigerators 
(some already do), and a host of other gadgets that haven't been 
invented yet.

These will come in all shapes and sizes, each addressing a different set 
of tasks.

And amidst all this variety, I see a role for a general-purpose 
do-it-all device for at least another few years, much as we have now 
with our laptops, desktops, and netbooks.

I think Apple does too, and very much look forward to OS XI.

  Richard Gaskin
  Fourth World
  Rev training and consulting:
  Webzine for Rev developers:
  revJournal blog:

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