iPhone Apps ... and you know it don't come easy.

The iPhone Application store has created a Meritocracy for mobile apps and the rewards can be great. The problem is that the market has many many titles. Over 7000 applications at last count. There are over 20 Blackjack Games alone (make that 21, we just released one).

Kenny Rogers Announces Casino Games on Apple App Store

Do the math. There have been over 200m downloads of iPhone apps. If we assume that one out of ten have been paid and half of those are games than we have 5m paid game downloads. There are over 1400 paid game apps in the store. This would imply that the average game sells a bit over 3500 copies. However, in a typical market HALF of the sales (or more) would be sold by the top ten titles. According to some sources, 80% of the sales would be sold by the top twenty titles. So an 'average' title might only see 1500 sales or so.

I have argued that the key to success here is to have extraordinary efficiency combined with excellent quality. That isn't easy, as reflected in the recent news from GLU on their iPhone efforts:

http://www.casualgaming.biz/news/27895/Glu-gloomy-despite-Q3-gains

However, despite the gains seen in Q3 the firm has issued a gloomy outlook for the upcoming Q4 - and president and CEO Greg Ballard has blamed the company's failure in capitalising on the iPhone phenomenon as the cause. To date Glu has released just one title for the platform.

"In truth, we were less disappointed about Q3 than we were about our outlook for Q4," Ballard told Pocket Gamer. "We missed our numbers, but only by about $150,000. But the slowdown that we see in Q4 is what's causing more uncertainty. Q3 was not as calamitous as the numbers might have suggested.

"We know that games are typically purchased in the first 90 days of owning a handset, so if people are buying fewer handsets, then fewer games will be sold. And in the US, when people did buy new handsets, a lot of them bought the iPhone.

I have blogged on how the cost structure of a venture backed game company can be a problem. It seems it is also a problem for established companies as well.

Predicting hits is a tricky business. Best to have a model where you can profit from even minor hits in this saturated market.

The iPhone Application store has created a Meritocracy for mobile apps and the rewards can be great. The problem is that the market has many many titles. Over 7000 applications at last count. There are over 20 Blackjack Games alone (make that 21, we just released one).

Kenny Rogers Announces Casino Games on Apple App Store

Do the math. There have been over 200m downloads of iPhone apps. If we assume that one out of ten have been paid and half of those are games than we have 5m paid game downloads. There are over 1400 paid game apps in the store. This would imply that the average game sells a bit over 3500 copies. However, in a typical market HALF of the sales (or more) would be sold by the top ten titles. According to some sources, 80% of the sales would be sold by the top twenty titles. So an 'average' title might only see 1500 sales or so.

I have argued that the key to success here is to have extraordinary efficiency combined with excellent quality. That isn't easy, as reflected in the recent news from GLU on their iPhone efforts:

http://www.casualgaming.biz/news/27895/Glu-gloomy-despite-Q3-gains

However, despite the gains seen in Q3 the firm has issued a gloomy outlook for the upcoming Q4 - and president and CEO Greg Ballard has blamed the company's failure in capitalising on the iPhone phenomenon as the cause. To date Glu has released just one title for the platform.

"In truth, we were less disappointed about Q3 than we were about our outlook for Q4," Ballard told Pocket Gamer. "We missed our numbers, but only by about $150,000. But the slowdown that we see in Q4 is what's causing more uncertainty. Q3 was not as calamitous as the numbers might have suggested.

"We know that games are typically purchased in the first 90 days of owning a handset, so if people are buying fewer handsets, then fewer games will be sold. And in the US, when people did buy new handsets, a lot of them bought the iPhone.

I have blogged on how the cost structure of a venture backed game company can be a problem. It seems it is also a problem for established companies as well.

Predicting hits is a tricky business. Best to have a model where you can profit from even minor hits in this saturated market.