Apple announced that January 1, 2017 was the iOS App Store's "busiest day ever" with $240 million total in customer purchases
Can anybody else remember when we all resisted making digital purchases? Software shipped on disks. Music was on CDs. We visited the video store and there was a bookshop on every high street.
It’s not so long ago
When Apple shipped the iMac in 1998 e-commerce accounted for less than one percent of retail revenue.
Today it’s around 15 percent or more (estimates vary), accounting for trillions of dollars in trade. Apple recognized the trend toward digital everything early -- why else did the iMac include its own built-in modem?
The Internet is only part of the story. Everybody today is digital, millennials expect Digital Everything – and the next generation will be even more wired (or unwired, to stretch the point for the mobile age).
This is the context in which to place Apple’s big news this morning, which is that it sold an astonishing $240 million in digital content to customers in just one day on January 1, 2017.
Apple also tells us developers earned over $20 billion in 2016, up over 40 percent from 2015. Developers have earned “over $60 billion” since the App Store launched in 2008, the company said.
Decode this information slightly and you’ll see that Apple’s focus on its services segment is paying off – over one-third of the cash developers have generated through App Store sales was raised in the last year.
When Apple shipped the iMac in 1998 e-commerce accounted for less than one percent of retail revenue.
Today it’s around 15 percent or more (estimates vary), accounting for trillions of dollars in trade. Apple recognized the trend toward digital everything early -- why else did the iMac include its own built-in modem?
The Internet is only part of the story. Everybody today is digital, millennials expect Digital Everything – and the next generation will be even more wired (or unwired, to stretch the point for the mobile age).
This is the context in which to place Apple’s big news this morning, which is that it sold an astonishing $240 million in digital content to customers in just one day on January 1, 2017.
Apple also tells us developers earned over $20 billion in 2016, up over 40 percent from 2015. Developers have earned “over $60 billion” since the App Store launched in 2008, the company said.
Decode this information slightly and you’ll see that Apple’s focus on its services segment is paying off – over one-third of the cash developers have generated through App Store sales was raised in the last year.
Virtual currency
There’s nothing virtual about this revenue. Apple also confirmed over $3 billion in App Store sales in December, adding that Nintendo’s Super Mario Run saw over 40 million downloads in its first four days on sale.
iPhone and iPad sales are probably pretty strong, at least, that’s what is suggested by Apple’s statement that Nintendo's moustached plumber's app, “was the most downloaded app globally on Christmas Day and New Year’s Day.”
Apple’s press release (you can read it here) announcing this data has a few more nuggets buried inside the blurb:
January 1, 2017 was the single biggest day ever on the App Store.
The App Store now offers 2.2 million apps, up 20 percent year on year.
App Store is available in 155 countries
App Store sales grew fastest in China, where they climbed 90% y-o-y.
The Apps for Earth and Games for (RED) App Store promotional fundraisers raised over $17 million in total for the two organizations.
There are already 21,000 iMessage apps.
Apple’s move to enable subscriptions across multiple app categories has also driven App Store business, up 70% from 2015 to reach $2.7 billion in 2016.
There are now over 20,000 apps offering subscription content.
There’s nothing virtual about this revenue. Apple also confirmed over $3 billion in App Store sales in December, adding that Nintendo’s Super Mario Run saw over 40 million downloads in its first four days on sale.
iPhone and iPad sales are probably pretty strong, at least, that’s what is suggested by Apple’s statement that Nintendo's moustached plumber's app, “was the most downloaded app globally on Christmas Day and New Year’s Day.”
Apple’s press release (you can read it here) announcing this data has a few more nuggets buried inside the blurb:
January 1, 2017 was the single biggest day ever on the App Store.
The App Store now offers 2.2 million apps, up 20 percent year on year.
App Store is available in 155 countries
App Store sales grew fastest in China, where they climbed 90% y-o-y.
The Apps for Earth and Games for (RED) App Store promotional fundraisers raised over $17 million in total for the two organizations.
There are already 21,000 iMessage apps.
Apple’s move to enable subscriptions across multiple app categories has also driven App Store business, up 70% from 2015 to reach $2.7 billion in 2016.
There are now over 20,000 apps offering subscription content.
So what?
Does it really matter how much money Apple and its developers are making out of selling digital content? Of course it does.
Not only does it illustrate the platform advantage the company offers in terms of enabling developers to create sustainable digital businesses, but it also reflects a huge sea change in the way we relate to such content. Apple Music is part of this.
At least in terms of cultural digital media we have it seems irrevocably moved to replace most physical media experiences with their digital equivalents.
The risks to this are genuine – censorship in a digital age means contentious content (like the New York Times) can simply disappear, while surveillance technologies make it possible to track what media people read.
This digitization appears to be driving continued media and retailer consolidation, reducing competition and potentially limiting diversity of output and choice.
It's not just risk but also opportunity: from access to everything from anywhere, to convenience, to interesting new ways to share and publish content digitally, and AI-driven personalization and content navigation systems.
The evolution of big data and AI may also in time render interesting opportunities for new forms of personalized digital content.
Movies with alternate story lines for different people are not impossible – you already see this happen in games and apps, so as content becomes more digitized you can predict more action there.
You can also explore new forms of digital content, such as Brian Eno’s recently released album/app hybrid, ‘Reflections’, an endless ambient work.
Does it really matter how much money Apple and its developers are making out of selling digital content? Of course it does.
Not only does it illustrate the platform advantage the company offers in terms of enabling developers to create sustainable digital businesses, but it also reflects a huge sea change in the way we relate to such content. Apple Music is part of this.
At least in terms of cultural digital media we have it seems irrevocably moved to replace most physical media experiences with their digital equivalents.
The risks to this are genuine – censorship in a digital age means contentious content (like the New York Times) can simply disappear, while surveillance technologies make it possible to track what media people read.
This digitization appears to be driving continued media and retailer consolidation, reducing competition and potentially limiting diversity of output and choice.
It's not just risk but also opportunity: from access to everything from anywhere, to convenience, to interesting new ways to share and publish content digitally, and AI-driven personalization and content navigation systems.
The evolution of big data and AI may also in time render interesting opportunities for new forms of personalized digital content.
Movies with alternate story lines for different people are not impossible – you already see this happen in games and apps, so as content becomes more digitized you can predict more action there.
You can also explore new forms of digital content, such as Brian Eno’s recently released album/app hybrid, ‘Reflections’, an endless ambient work.
Where next?
As technology becomes pervasive within intrinsically digitized daily realities, it’s inevitable that App Store sales will continue to increase.
However, the transition within digital experience means that as computing becomes more pervasive the barriers between digital-services-as-a-product and digital-experiences-that-underpin-lifestyle will dissolve.
That’s where next generation of AR experiences will begin to transform our physical experience of reality. Within this context you can expect App Store income to continue to grow, so long as Apple continues to successfully curate a platform the supports this transformation.
As technology becomes pervasive within intrinsically digitized daily realities, it’s inevitable that App Store sales will continue to increase.
However, the transition within digital experience means that as computing becomes more pervasive the barriers between digital-services-as-a-product and digital-experiences-that-underpin-lifestyle will dissolve.
That’s where next generation of AR experiences will begin to transform our physical experience of reality. Within this context you can expect App Store income to continue to grow, so long as Apple continues to successfully curate a platform the supports this transformation.
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