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Industry analyst Gene Munster of Piper Jaffray may have caused some real shockwaves in the Apple tree recently. A survey carried out by Jaffray of some 20 iPhone developers revealed that around 71% of the apps planned for release to the app store were going to be available for free. He also found that among those with a cost, the average cost was $2.29. An earlier keynote had suggested a cost per app nearer $10.
This apparent drop will be bad news to Apple, who stood to gain 30% per sale in return for providing bandwidth and hosting capacity, and for the infrastructure of the app store itself. 30% of nothing is still nothing.
But Apple’s consternation will be short lived if they have anything but the most short sighted of outlooks. It is simple to predict that free apps for the iPhone will add value to the iPhone for future and current users, so while the app store will perhaps not make as much profit as predicted, the value it adds to Apple’s current line of products will more than compensate.
In many sense, then, the under estimating by Apple of the app store will mean benefits for everyone.
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[…] not believe that this difference in expected and achieved prices will affect the benefit of the app store to Apple. And we agree. What may be a slight loss here will translate to a gain for the iPhone when […]