On the Ubiquitous iPhone

It appears that 65% of the current download total is made up of games. What's more, the majority of apps are free. Moriana estimates Apple's share of the revenue from the staggering two billion+ downloads as being between $20 - 45 million per billion downloads. Now, this actually isn't a huge number. The app store sustains massive volumes of sales in the hardware, which is where Apple really makes money. In fact, does an app store, based on least-common denominator or free applications really make sense for an operator which doesn't achieve nearly the same returns from mobile handset sales (which are generally subsidised)?

When one considers current global mobile service revenues of $800 billion, of which 85% comes from voice and SMS, the figures look small in comparison. So, again the question: why all the fuss about app stores? Shouldn't operators make their investments into services which leverage rich assets such as voice, messaging and capitalise on data growth? Isn't this where the real prize might be found? More on the iPhone and future telco application strategy soon.

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