Is the App Store actually profitable for developers?

But is it really a happy marketplace? If we have a look on Game Center, it would seem that all but the very highest profile games do, in fact, struggle to make any real money.

Consider a couple of games that Digitally Downloaded has reviewed in the past few weeks. Grove Keeper HD, just released, has just 18 people listed on its leaderboard. Boom Boom Gems, 46. Reiner Knizia’s ClusterMaster, 4,947, but that’s for the free game. For the game modes you unlock by paying for the game, 102 names is the most populated leaderboard.

Even the higher profile Bird Zapper! seems to have struggled to gain traction. Despite being really good fun and having the marketing might of Namco Bandai behind it, has only managed 30,472 leaderboard names. Galaxy on Fire 2 – one of the highest rated RPGs on the App Store, 48,566.

This game is awesome, but best seller?

Now consider that most of the games listed above are very cheap. At $0.99, Bird Zapper has made $30,198 according to Game Center. ClusterMaster, potentially as little as $100.98.

Galaxy on Fire is a little more expensive, at $6.99, but still only made the company around $339,476 – hardly enough to sustain a professional corporation long. Poor young Grove Keeper, despite a price of $2.99, has brought in $71.82 – that barely covers the Apple licensing fees for a year.

Now, Game Center is not definitive – according to it, for instance, there are 1,364,759 people who have downloaded Flight Control. The actual sales figures are around 4,000,000. But even assuming that 1/3^rd of people who download these games play them on Game Center, Bird Zapper still comes in at less than $100,000 by assuming a triple sale/ Game Center user ratio.

It’s also worth noting that developers are now wisely adding in additional revenue streams for these games. Bird Zapper and ClusterMaster both feature in-game bonuses that can be paid for with a little extra money. But it’s not going to boost these games anywhere near the million mark.

This game deserves far more love

And indeed it’s possible to port these games to additional platforms – such as the Android market, for additional sales and revenues. I am not for an instant claiming that these rough and raw calculations are an indication of how much revenue these games bring in in reality.

But look at even Flight Control. It’s been around for a few years now, and assuming $4 million roughly translates into $5, $6 or even $7 million in revenue (given the higher prices for iPad, DSiWare or PSN versions of the game)… Firemint is a company with around 100 people now. Given the average wage in Australia is $64,641/ year, that’s $6.5 million per year to pay everyone, and that’s before tax, the cost of the office and other business expenses.

This is all quite vague (for instance, it’s unlikely that the average wage at Firemint is equal to the average Australian wage), but it highlights a point – even the most popular games on the Apple App store are quite possibly only just scraping through as profitable.

Spare a thought for the poor indie developer or start up company that lacks the marketing budget, then, or the capacity to release a steady stream of new games. It’s unfortunate, because it means so many good ideas are potentially unrewarded.