Company - - Jan 06,2017
Apple's App Store had a marvelous 2016 as it generated record revenues, up by 40 percent than the previous year, as revealed by the company.
Apple announced that the digital marketplace generated over $20 billion in collective revenues for all of its developers in 2016. The company said that App Store has paid out more than $60 billion to developers since its opening in 2008. A third of that was generated in 2016 alone.
App Store's bestsellers were dominated by games, including the latest hits like Pokémon Go and Nintendo's Super Mario Run. The holiday season proved beneficial to the App Store's record-breaking success. According to Apple, consumers made over $3 billion in purchases from the App Store in December.
According to some experts, the incredible rise was largely driven by in-app purchases, such as paying to upgrade a character. The accelerating inclination towards a relatively new business model where people download a game app for their iPhone or iPad for free, but then have to pay to buy additional features such as opening secret levels or new powers.
In 2016, Apple even changed its revenue sharing agreements with developers of subscription apps such as Netflix and HBO Now. In the first year of a customer's subscription, the existing agreement gives the developer 70% of revenue and Apple gets 30%.
Apple's App Store currently hosts more than 2.2 million free and paid apps that can operate on the iPhone, iPad, and the company's other devices. Apple says its marketplace is growing rapidly, and the number of apps its offering was up 20% year over year in 2016.
The App Store already appears to be playing a major part in contributing to a growing services business in 2017. As per the company, on New Year's Day, App Store recorded its busiest day ever with nearly $240 million in app purchases.