Apple Apps Are Bigger Business Than Music and Hollywood

There were some people who sniggered when Apple introduced the idea of apps and the Apps Store following the unveiling of the iPhone. Those people aren’t laughing now.

The Apple App Store now generates more money than the entire music industry on an annual basis. It also generates more than Hollywood. And if you add in all the money that’s coming from Android apps…

From MusicAlly:

Apple’s App Store generated $1.7bn in transactions during July this year – a stat that got a bit lost when Apple’s services boss Eddy Cue announced it, due to being paired with his announcement of 11m trial members for Apple Music.

That $1.7bn means a yearly run-rate of around $20.4bn, which as analyst blog Asymco notes, is up from around $13.7bn a year ago. “Nice growth,” reckons Asymco’s Horace Dediu. Indeed.

His graph cross-referencing Apple’s App Store billings against other forms of entertainment makes for sobering reading: they overtook iTunes music sales in 2011. But it’s the comparison with Hollywood that Dediu is more interested in.

“It’s not likely to happen this year but next year Apple’s apps will almost certainly overtake global box office in revenues,” he writes. “This contrast with movies gives some perspective on the creation of a new market. Apps did not exist as a medium in 2007. But, together with Android apps, apps are likely to have already overtaken revenues from an industry that is a century old.”

As an analyst within Nokia between 2001 and 2009, Dediu surely knows there *was* an apps market before the App Store launched in 2008 – it was just almost-entirely focused on games sold by mobile operator portals, and was much smaller (and more dysfunctional in many ways) than the post-2008 explosion.

Keep reading.

Alan Cross

is an internationally known broadcaster, interviewer, writer, consultant, blogger and speaker. In his 30+ years in the music business, Alan has interviewed the biggest names in rock, from David Bowie and U2 to Pearl Jam and the Foo Fighters. He’s also known as a musicologist and documentarian through programs like The Ongoing History of New Music.

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