If you don’t read this post till the end your App will probably get less than 1,000 downloads. if you do read it and get also a little help from the cosmos, there is a chance that you will be among the very few short head winners of the App store and stay there for eternity (mmm… a couple of weeks more likely).
A few days ago we were invited to a big family dinner. During the evening I noticed that 4 guests were playing the same game on their smartphones. It turns out they were not the only ones. There were at least 10 million others who were playing the same game at that time. For me it was the time to start exploring the short head of mobile Apps.
So they say there is a long tail of Apps, and they are right.
There are already more than one million Apps for iPhone and android on the App store and on Google play and it is getting bigger and bigger. There are also more than 300,000 different developers who have uploaded Apps to these platforms and people spend a lot of money buying Apps (I phone users alone spend 10 billion dollars a year in the App store).
So there is a long tail but does it work? (If you have been following my blog you probably know the answer which is based on the 2nd and 4th rules of the short head).
The short head of downloads
In order to try to understand how the long tail works or doesn’t work in the App market I looked at the stats on Appbrain, which explores only android apps downloads, and did some additional calculation based on several assumptions.
According to Appbrain this is how android App downloads is distributed:
- 430,000 apps were downloaded less than 100 times.
- 304,000 apps were downloaded less than 1000 times.
- 255,000 apps were downloaded less than 10K times.
- 156,000 apps were downloaded less than 100K times.
- 38,000 apps were downloaded less than 500K times.
- 7,000 apps were downloaded less than 1M times.
- 8,500 apps were downloaded more than 1M times.
It means that most apps (734,000) don’t reach more than 1,000 downloads. That a bummer.
But wait a minute. Don’t be so negative. This chart also shows that there are more than 200,000 different apps that got more than 10,000 download. Not bad. It seems that not only the head is big but also the body. But is it really?
Let’s look deeper into the head – We are talking about 8,500 apps that got more than 1M downloads, among them you can find a few that got more than 500M like Facebook, Whatsup, Youtube, Gmail and Google maps, and some that got more than 100M like viber, instagram, candy crash, skype, subway surfers, facebook messenger, tiny flashlight, fruit ninja, twitter and chrome.
If we try to calculate how many cumulative downloads those 8,500 short head apps have altogether we can assume the number is around 25 million (an average of 3M per app).
In that case the demand chart looks something like this:
- 0.1% of the apps generate almost 50% of the downloads.
- 4.5% of the apps generate 80% of the downloads.
- 17.5% of the apps generate 97% of the downloads.
- The remaining long tail apps (82.5% of the apps) share the 3% leftovers.
I was still not convinced that my assumptions were right so I added information I got from digitalinspiration.com, a list of the top Android Apps that have reached more than 50,000,000 downloads on the official Google Play store. It is not current stats but it still offers a better understanding of how the short head splits.
Their list shows this distribution:
- 5 apps have more than 500M,
- 24 have more than 100M,
- 36 have more than 50M
- and 250 have more than 10M.
When adding that info into the chart we see that the curve becomes even more short headed:
Now it seems like 4.5% of the apps get 86% of the downloads.
The remaining 95.5% of the apps get only 14%.
That’s a short head, not like in the movies but still impressive.
We see the same short head behaviour in terms of active users. At the earlier days of the app store, in May 2009 to be more specific, Admob (the ad exchange for mobile which was later on bought by Google) published their monthly statistical report of the apps in its ad network.
Their findings were that most apps had less than 1,000 monthly active users. 27% had between 1K to 10K active users each month, 14% had more than 10K and less than 100K, 4.5% had more than 100K active users, and 0.5% had more than 1M.
That is quite of a short head in terms of active users or as mashable said in their headline back then “Apple App Store: Overpopulated with Apps Nobody Uses”.
Your app will get you rich! just like gold mining would
So there is a short head in terms of downloads and usage, but the short head economy is interested also in terms of revenues.
The apps business is based on 2 major revenue sources – money from users (paid apps and freemium apps) and money from advertisers (free apps with ads).
A Gigaom pro report from 2012 based on a survey of 352 app developers confirmed that there is short head in apps ad revenues when it found that almost 40% of Apps earned less than 100$ per month from ads, another 30% earned more than 100$ but less than 500$ per month.
2% earned more than 20,000$ but they earned so much more than 20,000$ that despite the small size of their group (only 2%) and the fact that the majority of the apps earned less than 500$ per month, the average of the monthly revenues for apps stood on 1,588$.
When it comes to paid apps it is even worse – almost 60% of the paid apps earned less than 500$ per month, 20% of the apps generated thousands of dollars per month and less than 4% earned more than 20K$.
The future was wide open (Tom Petty) – will it?
“Think again before quitting your day job”, said Matt Coombe, co-founder of the Toronto-based app development company Get Set Games in an interview a few weeks ago.
“In the early days it was basically if you could make a decent app and get it out on the App Store you had a very good chance for success. You wouldn’t necessarily become a millionaire overnight but you could make a decent salary for yourself…I think those days are over because there’s so much quality out there.”
“It’s very difficult to stay high on the charts in the App Store and it’s very hard to know why or how,” Coombe says.
So the present looks worse than the past but the future looks even worse.
“The vast number of mobile apps may imply that mobile is a new revenue stream that will bring riches to many,” said Ken Dulaney, VP and analyst at Gartner. “However, our analysis shows that most mobile applications are not generating profits and that many mobile apps are not designed to generate revenue, but rather are used to build brand recognition and product awareness or are just for fun. Application designers who do not recognize this may find profits elusive.”
Why doesn’t the long tail work for Apps? read more in part 2