Making and monetizing apps. Is it profitable?

It is believed that making money on mobile apps is very simple. It is enough to make a game that goes to the top to make huge profits from the millions of downloads. However, the reality is that to make such an application is becoming increasingly difficult, same as monetizing it.

The high demands of users for mobile applications and a huge competition doing their job. For example, Google Play and iTunes now have more than one million applications in each of these stores. How to stand out among such a variety, and even more, to offer something really new and exciting – it is becoming increasingly difficult. Many of the paid apps have a free alternative, which in fact turns out to be not much worse.

According to estimates, 90% of the paid apps are being downloaded 500 times per day. On an average day the developers of these apps receive more than $1250. And this amount in the future will only decline. Due to immense competition and increased user requirements, companies will have to spend much more on development, tests and support of their application. Under current trends, by 2018, only one out of 10 thousand applications will bring its creators commercial success. So developers who want to make money on paid apps, will face serious difficulties.

As for the free applications, by 2017 their share will increase from 91% to 94.5% and the total number of downloads from 102.1 to 268.7 billion. The number of downloads of paid applications in 2017 will also increase from 9.2 to 14.8 billion, however, their share in the total number of downloaded applications will decrease.

Given the huge number of applications available, significantly increasing the role of various recommendation services such as social networks, bloggers and media who are making software reviews. It will be extremely difficult to choose from more than a million applications, so users will seek the advices.

I have found an interesting statistic of how much developers earning on their apps.

As we can see the 49% of developers have not earned anything on their apps. 11% earned almost nothing ($1-$999). Another 11% earned between $1000 and $9999. Those whose apps have brought profit of more than $50 thousand were only %18.

Most of the mobile developers create games applications.

The most popular model of monetization (50%) – paid, in app purchase (iAP) is used by 49%, 40% work with advertising and 33% gets money by developing apps for third party.

Most of the developers saying that the main problem is low findability of applications. According to them, markets today are overwhelmed with content (including poor quality). The second major problem is the high level of piracy. So it’s up to you to decide if the mobile application development is profitable nowadays or not, however now you know that the competition is very high as well as risks.