A small number of developers, almost entirely game companies, continue to generate the majority of revenue at the leading app stores - Apple’s App Store (iPhone only) and Google Play, according to an analysis by Canalys.
Canalys estimates that just 25 developers accounted for 50 percent of app revenue in the United States in the Google Play and Apple iTunes stores during the first 20 days of November 2012. Between them, they made $60 million from paid-for downloads and in-app purchases over this period.
That is a classic Pareto distribution, sometimes called a "Long Tail" or the "80/20" rule. The idea is that, in any market, or any natural world distribution, a small number of instances account for a highly disproportionate share of the total cases.
In business, that might be also called the law or rule of three. It's the same idea: a small number of actors, instances, companies or objects have a disproportionate share of total instances.
Also, Of the top 25 grossing developers, all bar one (popular music service Pandora with its Pandora Radio app) are game developers.
Tuesday, December 4, 2012
There's a Long Tail (Pareto Distribution) for App Store Developers
Gary Kim has been a digital infra analyst and journalist for more than 30 years, covering the business impact of technology, pre- and post-internet. He sees a similar evolution coming with AI. General-purpose technologies do not come along very often, but when they do, they change life, economies and industries.
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