The lastest study from Gartner (the consulting group) highlights the fact that by 2018 only 0.01% of Apps developed will be profitable. According to Ken Dulaney, vice president of the company, despite the fact the number of Apps grows exponentially, “most of them are not generating profits, they are not even designed to do so, they are meant to establish a brand image or just for pure entertainment”.
The truth is the App ecosystem is an immense scenario in which many developers coexist. “There are barely entry barriers to this market”, states Miguel Ángel Lozano, director of the “Expert in Mobile Devices Programming Course” from the University of Alicante. “Anyone can publish their own App paying a small annual fee, and with a computer and a smartphone, we already have a ‘developed kit’ ready to go”.
The result? Every day Apple’s App Store receives more than 500 new Apps on average. Most of them are free, which makes consumers raise their expectations when taking into account paying for one. According to IAB Spain in their latest Mobile Marketing report, despite doubling the average usage of Apps, only 35% of users actually paid for one of them.
“Its less than the price of coffee”, points out Carlos Méndez, associate of Ameu8, the company developing mobility solutions for Everis. Méndez is totally convinced the current model is not economically viable because at this point, “it is impossible to change consumer’s mind set about paying for Apps”. He sees Apps as the new “.com” and foresees a crisis when one big App giant falls to it’s knees.
How do you think this will go down? Drop me a line in the comments!