Ronnie05's Blog

Apple: Software Services as Differentiator


Customer loyalty is a thing of the past, or so it is believed. Not with Apple though! RIM, Nokia, Microsoft and Pre are busy in their preparations to launch their own options of App. Stores, and it might seem that this will take the wind out of Apple’s Apps Store sails. Au contraire, quite the reverse seems to be the case as Apple seems to be accelerating both in terms of number of applications on their stores and the downloads. On March 5th, 2009 Apple registered its 25000th application in its iPhone store. Before this, sometime in mid January, Apple had passed the 500 million mark in downloaded applications! For full report click here!

apps-storeThe 25000 apps and 500 million downloads on 23 million devices act as a part of a software strategy, which creates a distinct stickiness for the iPhone and enhances customer loyalty over the long term. It is believed that the Apps personalize the iPhone to levels that competitors cannot match and consumers cannot do without. This creates a huge stickiness between the consumer and the product. A device tailored by him according to his requirements in the one thing that he needs the most and at present Apple does seem to have both the device and software wherewithall to give suffice his need.

While Apps range from free to $999, it is but obvious that the ones in the lower price brackets < $2.99 consitute 80% of the apps and probably will also feature as much in the downloads!

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  1. […] Gartner’s predictions for 2010 are 4.5 billion apps sold, for a total of $6.8 billion in revenue. If Apple can merely maintain its current rate of about a quarter billion app sales per month, it stands to be responsible for 3 billion apps sales—67 percent—good for $4.5 billion in revenue. Apple’s cut would be $1.35 billion, with developers taking the remainder. However, as Apple gains more users from sales of new iPhone models and possibly from an expected tablet, Apple could get an even larger share of the mobile app market. This then is a key profitability driver for Apple, the fulfillment of a prophecy made with regard to profitabilities and Apps stores. […]

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