Comments on: iPhone application business model http://www.jwsecure.com/dan/2009/07/02/iphone-application-business-model/ Security, information technology, business Tue, 16 Mar 2010 01:26:51 +0000 http://wordpress.org/?v=2.6.5 By: David LeBlanc http://www.jwsecure.com/dan/2009/07/02/iphone-application-business-model/#comment-1202 David LeBlanc Mon, 06 Jul 2009 22:52:17 +0000 http://www.jwsecure.com/dan/?p=502#comment-1202 I think you're missing some costs - any decent app ought to have a tester, preferably one per dev, worse case 1 tester per 2 devs. A really top-selling app ought to make really good money, but a top-notch app also has UI designers, coders, testers, etc to support as well. Another factor is that you assume the download rate will be constant - some will, some won't. I'd be willing to bet a good app will go through several phases - early adoption, quick ramp up, stablization, and decline. In order to keep someone from coming along and stealing your market, you need to keep moving - better to compete with yourself across versions than to have someone take your space. Keeping moving means more dev and test costs. Don't get me wrong - might be a good way to make $$, but it is more complex than you (admittedly) model it. I think you’re missing some costs - any decent app ought to have a tester, preferably one per dev, worse case 1 tester per 2 devs. A really top-selling app ought to make really good money, but a top-notch app also has UI designers, coders, testers, etc to support as well.

Another factor is that you assume the download rate will be constant - some will, some won’t. I’d be willing to bet a good app will go through several phases - early adoption, quick ramp up, stablization, and decline. In order to keep someone from coming along and stealing your market, you need to keep moving - better to compete with yourself across versions than to have someone take your space. Keeping moving means more dev and test costs.

Don’t get me wrong - might be a good way to make $$, but it is more complex than you (admittedly) model it.

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