Apple And Google Are The Middlemen

Apple and Google are the middlemen (taking up to 30% of revenue); they dominate with about 90% of 102 b. apps that were downloaded in 2013. Extra income sources

i) the transactions income from apps when you enter your credit card information directly

ii) in-app purchases, ie extension of pay-before-you-download model; it made downloading the app free (plus encouraged more people to do it) and gave the app developer the opportunity to sell other services or products with the app. For example, "Clash of Clans" game makes 100% of its revenue via app payments, ie US $890 m. In 2013, similarly, e-commerce via mobile apps account for an estimated US $ 43.2 b. in mobile sales; up from US $ 21 b. (2012).

"...This means that mobile represented around 13% of the US$ 260 billion total e-retail sales in 2013. Amazon doubled its mobile sales in 2013 to $ 8 billion, with eBay doing $ 8.8 billion..."

George Berkowski, 2014

iii) advertising via app magazine

· The app stores were very popular with developers as they could

- build up massive audiences

- make it easier for users to make purchases with credit card details, ie a single click

- the app store owner manages everything to do with the accounts, payments and any hassles, such as fraud & chargebacks

· Facebook's app and Apple's Safari dominate mobile web browsing

 

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