"Seeking fortune and fame, entrepreneurs rushed to create programs for Apple's App Store. That's not always what they found." http://www.newsweek.com/id/216788 Not a lot of surprises, but this is the first mainstream article I've seen that's injected a dose of reality into its AppStore coverage. The article cites a number of folk that admit invested large sums of money up front into making an iphone app, only to end up in debt. This includes apps that were featured and reasonable popular. The expense and risks for someone that wants to hire a team of artists & programmers are huge.
Good article. Ever since Adobe announced Flash CS5 with iPhone support, the flash developers around me have all picked up a Mac mini and an iPhone. I also hear them use words like "iShoot" and "retire" bounce around the conversation in hushed excited tones.
I know newsweek is generally supposed to be impartial but the article seems to purposely lean toward painting the App store today as if the lake's dried up. Their first example is an entrepreneur who borrowed tens of thousands of dollars to create a mileage counter app and only made 99% of his money back. From my observations, the App store is still a great marketplace and the audience is growing by the day. All that's changed is now there's actual competition in the store, and a cheap app won't get noticed like it did have when there were only 400 Apps available, and those devs who do create great apps can't just toss the App out there and see if it swims, they need to market it. Finally, there's no chance of becoming a millionaire selling your software or games at 99¢ each. I believe there's still a lot of evidence that a business can be successful on the App store, you just can't rely on luck anymore. These are just my views – I am interested to see what others think about this too.
It's a sobering article, and a good counterpoint to the many articles that have been written focused on success stories. I wouldn't say that the lake's "dried up" but rather that the money being made is being increasingly concentrated. Just based on the total number of apps in the app store and the number of apps that are essentially invisible thanks to not being on the top lists, for every game that makes a tidy profit, I'm quite sure there are at least 20 that barely or never make back their development costs. The top lists create a visibility feedback loop that promotes the apps that are already doing well. The featured app concept further serve to single out apps and give them a massive push, beyond what any reasonably budgeted marketing effort outside the app store could do. The same effects occur with music, tv, etc. And it'll only grow stronger as companies like Gameloft further strengthen their brands. Users have little incentive to bother searching for niche apps when there are so many good apps that are browseable with just a few clicks. I have yet to see any evidence that marketing outside the App Store is an effective strategy for indie developers. I think luck is and remains a huge factor. There are many things completely or largely outside the developer's control: timing of releases from competitors, Apple's decisions over what they feel like featuring, and getting featured here at TA. If anything, luck today is a much a bigger factor than it was at launch. At launch, there were relatively few apps, so apps could be considered and judged on their own merits. Today, new apps have only a small burst of visibility at release - if they don't catch fire then, they'll rapidly drift into obscurity.
I found the article very negatively slanted. Now, I'm not saying that there's still millions to be made. but you can read these outcomes very differently Demeter hasn't put out anything after Trism, but did quite well early. Ethan Nicholas is definitely at success story ($800,000) Nathan Hunley is +/-. He is making a living off of it, though not making a ton arn
Interesting. But why is the measure of success being a millionaire? If I could replace my salary with app income, I'd be thrilled. With that said, who says living off your app money is the measure of success? I really wonder where these high app costs are coming from. I'm assuming they're taking into account some sort of estimated hourly pay per programmer. I personally don't track my hours as money spent. They're my "off" hours from my day job anyway. I could be playing Xbox or watching TV but instead I code. As far as costs versus income goes, my income far outpaces the costs and I'm making money, even with what humble sales I have. Folks who have helped me have been compensated fairly for their hours of work via royalties. I wouldn't say that's a lack of success... just reality. I don't think the article is any sort of shocker. The first software for any new hardware is going to have inflated sales...
Independent iPhone Dev here. I work with an ex-Electronic Arts Character Artist (extremely talented), and a non-profit Game Modder. These two guys are both my brothers, so I don't have to pay them a salary. It was ~$600 for a mac mini and $99 for dev licensing, two of us already owned iphones. Judging by the quality of our apps (which are still being polished) and our planned marketing techniques, I will be thoroughly surprised if we don't make double or triple our investment in the first month after they launch. During these projects we have been working full-time jobs, with part-part-time iphone development. Granted, our situation is unique, but I think this will be the common success story in the future of the App Store. Also, a note: I've watched many indie devs talk about their experience, a good number of them have sold well over 500 in one day, and thats a game with mediocre art, mechanics, etc.
I'm pretty sure that's not what the article said. What it says is that most devs, even those who have quality apps in the top 100, are NOT going to make their investment back. Pointing to one hit wonders on last year who got lucky is not a true reflection of a currently black hole business model. It's slanted more so than your average business model is against indies in the entertainment business. It's not a matter of a few devs crying that their apps only made tens of thousands of dollars instead of millions, it's that if you are an indie dev that makes games for this platform, even if you have a one hit wonder game, you are most likely going to fail to get good profits, with a good chance of going in a deep hole.
I think some of the devs mentioned in the article aren't being realistic either. This is a business, and you can't expect to have a hit each time you release a new game. That's true of any business. The last thing the iShoot dev should be worrying about is whether his next game is a hit. What he should be concerned about is creating a sustainable business if this is the route he's going. The same goes for the other dev who used his entire life savings to follow the iTunes dream. No offense, but he sounds just as bad as the dot-coms during the 90s. If you don't have a plan, and think creating a game by itself will sell and make you a bazillionaire, then you're in for a reality check. I cringe everytime I hear the media out here use iTunes and gold rush in the same sentence. They don't have a clue, and they only help create this misperception of how "easy" it's supposed to be. Too many aspiring devs put all their eggs in one basket, and you can't blame Apple for that.
for what it's worth, the App Cubby guy seems to think it's been a success for him http://appcubby.com/blog/files/app_cubby_success.html
AppStore Devs are not all doomed but those who saw Fart apps making thousands of dollars last year and thought they could do better than that will be disappointed as it`s a lot more mature market now and below quality products wont cut it anymore. With so much competition now, the devs have to come up with new concepts, implement them efficiently and market them well enough to have any chance of success. Just like the way it is in every other market, except for the fact that coding for the iPhone and getting your apps up for sale is a hell lot more easier and cheaper compared to rest of them.
Fair enough. I was responding to the quoted devs who lamented that they weren't millionaires. My point was that becoming a millionaire within months in most any business is an unreasonable expectation or measuring stick for success. I also don't take the article as saying that you're mostly likely going to be in the hole if you develop. It's point was simply that iPhone apps are no longer an easy path to riches as it has been assumed. With that said, if you're going deep into the hole making games, you're doing something wrong. As someone else mentioned, if you have a sensible business plan you can make money.
I agree with that one. All the games I've actually seen have either been poorly done and not sold well, or vice versa. You can have a good app and not hit the jackpot, but for it to fail completely is another matter.
the people that quit their day job/don't have one and then convince themselves that making a single app(out of the millions already available) is going to be the answer are doing it to themselves. they might as well play the lottery. the indie developers that work a normal job and then code into the wee hours of the morning with passion are going to be the real success stories. they got to create something they wanted, and got it out to the people. if it sells at all, they get extra income on the side, and the comforting thought that people out there are enjoying something they made. if it doesn't do so hot, then they still have their job and the same reliable income they've already had, plus the fact that they created a program is now under their belt. it's a ridiculously wild market in the app store, so i'd suggest playing it safe.
I don't think it's a great idea to invest your life savings in the App Store but it can still be very profitable. As a long time developer I chased the dream of creating games full time while running another business. With the App store I was able to leave other work and other businesses behind, which is something that PC game development never allowed. I'm not getting rich in dollars but I second the idea that I live a rich life. Doing what you like doing with your time is really what life's about. Even if I were a millionaire I would still be doing primarily the same thing. Not that I don't want to succeed that way, I absolutely do but when I do I still expect to keep on plugging away at game development. The games will just have higher budgets
+1 for living a richer life. An old high school buddy and me recently put out our first app Invisible Links. We spent months and months learning and coding and designing in our free time. It has to be something you love. It has been a great experience. We still keep our day jobs of course, which I think is the important thing for indie devs to take away from all this. One week after release it made it to the new and noteworthy section of the app store games. That was yesterday that we found that out, and so we don't have a good idea of what that will do for sales numbers just yet. I'm sure things will pick up a bit. I don't however, really expect to get a decent paycheck for both of us if you take into account what it would be for an hourly rate (here's hoping it does but you have to be realistic as well). That's not the point though, the point is that two guys were able to learn and create a polished game in nine or so months. The payoff is seeing that some people like what you've created whether it be just your friends and family or a larger following. There was something about seeing it sitting featured next to games like FIFA10 by EA sports. Our icon sitting next to a huge name like that? priceless. edit: Just a word of caution to devs that get featured. We wanted to try and ride the visibility a little bit from this and so decided to push out a Halloween level update today. All day our screen shots have been in and out of working on the app store and our ratings have disappeared in some instances as if the update were already live (it is not). Not sure if this is common, I just thought I'd put out the warning cause we have been very frustrated.
From the article: I don't know about everyone else, but this sounds insanely wrong to me! I'm sure there are a couple people making apps out there with this sort of budget and expenses, but it's a big minority. My first game, Skeleton Key, took slightly more than a month to make. My expenses included: $750 on a MacBook off eBay, $220 on an iPod Touch 2g, $99 on an iPhone developer account. I put a whole lot of work into it, and my girlfriend helped too because she's a talented graphics artist. I did all the programming, all the sound, some of the graphics, and we used royalty-free creative commons attribute licensed music (really good quality stuff too) that was free, and so none of it cost any money. I'm not counting paying myself a salary in this, but my total expenses so far have been $1,069. And I'm using the same laptop, iPod Touch, and developer account for my next two games that I'm working on simultaneously now. We haven't gotten our first bit of money in from Apple yet, but when we do I'm expecting to get over $2,000. Which would pay for all the startup costs, and while it isn't exactly a living wage for San Francisco, it's not the worst, and this is all from one game. But it definitely seems like a viable business for me. I'm not expecting to become a millionaire, but I think I can make a real living off of it.
$15000 living costs? In 3 months? Or did he expect to live 1 year from the income of a single app? Does this include his girlfriend? $5000 for legal and administrative services? For a single app or for starting a new business with a bunch of payed developers, artists, etc.? I guess this includes contracts, etc. he will be able to use for all future projects. $29000 + $4000 for programmers/artists? How about having some own talent instead of paying for everything? I would like to know how many hours he actually spend on the app and not for building a software company. I guess most people would be happy to start a new business with only a few thousand dollars in the red. Is $10 per hour a bad hourly wage if you just started a new business based on selling software products other people created for you. How would be the numbers if he was a good coder that could save the money for programmers?
