iPhone app developers earning plenty of money from in-app purchases: Velositor

Daniel Bader

March 17, 2012 11:51 am


Mobile app research firm Velositor has released some very interesting facts about iPhone in-app purchases. A practice that is becoming increasingly common in games, as well as productivity and social networking apps, app developers are making upwards of $63,000 in their first month from in-app purchases.

The study breaks down the amounts between game- and non-game apps, as well as between Canadian and American users, but the numbers speak for themselves.

Sourced from data between 2011 and early 2012, the average American iPhone developer earned $63,885.34 from in-app purchases including games, and $23,482.15 if you remove games from the equation. Canadian developers earned nearly 5x less, with $11.5k and 4.2k respectively.

The numbers seem absurdly large, and considering these are averages, this means that developers with the most popular apps are likely earning millions of dollars from in-app purchases. The freemium model, which allows users to download and begin playing a game without paying, allows users to typically buy in-game currency, extra filters or premium features for a small price. This gives developers more traction in designing and releasing addictive games that can be funded with by those who want to enhance the gaming experience, without sacrificing the quality for those who don’t want to spend anything.

Titles like Tiny Tower, Temple Run and, to a lesser extent, Path have taken this approach. Some users accuse developers of being greedy by creating games and apps that are not fully functional, or by designing games that cannot be beaten without spending money after downloading. Others are citing in-app purchases as the saviour of the excessively-low prices in the mobile app market, bringing revenue to dev teams who have languished in poverty for too long.

You can get a good sense of things by reading Velocitor’s overview.

  • Chuku

    Better than having in-app ads.

    • DanT

      Average developer does not make 60 k in the first month, take the median, when one company makes millions and 100 developers make $20, does the average dev really make 30 or 40 k? Nope.

  • Sean

    I prefer premium to ads or paying upfront. Though I have a problem with pay to win. As long as you can okay a game and enjoy it without suffering because you don’t buy something you are ok. And if its a game where they are like “here use in game credits or money” and you can earn credits in game

  • ljp

    I’m always skeptical of research sites that release these press packages but charge to view their proclamations in detail. I’m not going to pay $20 just to find out the ways in which their methodology is questionable.

  • jon_d0e

    i rather have apps that cover half the screen and get it free then to pay! loser apple users.

  • jon_d0e1

    I rather have ads cover half then to pay.

  • Chris

    Are median figures available? Averages don’t tell us if the revenue is 1% 1M$ vs 99% $100 (for example. How does this compare to makers of android apps. And RIM? Wasn’t there a piece that said RIM ads made $100,000 (albeit for the lifetime earnings, not over 1 year).

    • AppleBeest

      Oh please RIM playbook does not count… and Blackbery APP world is a joke..

      Those loosers in waterpoo cannot even get Netflix to make an App and you DARE TO COMPARE TO APPLE?

      WHO THE FAQ DO YOU THINK YOU ARE?

  • cheenachatze

    There is a mistake in the article: the Velositor figures show how much a developer is expected to earn in the US/Canada market. They don’t say that the developer is American or Canadian. The surprising thing in the comparison between US and Canada, is that even though the US population is 10 times bigger, the revenue is only 5 times bigger. So on average, Canadians spent twice the amount on in-app purchases than Americans.

  • AppleBeest

    AHAHAAH!!!

    APple iPhone is the best… WP7 sucks and RIM Blackberry sucks even worse… only real competitor is high end Android phones…

    RIM needs to get rid of those FAILBOOKS for $99

    fuk Waterloo.. I’l like to cack on blackberry…

    • iHurt

      I’d like to smack your english teacher. He or she failed you.

  • lucky

    shark tank

  • Matt

    As an app developer, trust me when I say, this allows you to break even, maybe. I’ve had some popular apps, some paid, some in-app pay, either way, I broke just about even, paying myself a very poor 10 bucks an hour, not including biills or equipment costs. It took three months for the first app to break even, two and a half for the other.

  • Cell Hell

    I avoid in app purchases and games that require them. I hate being nickeled and dimed every 5 minutes.

    It pisses me off to pay for a game then have to pay again and again and again. It’s game rape.