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Author: Horace Dediu

iPhone OS games 5% of all games and 19% of mobile games

Apple’s App Store has grabbed 5 percent of the roughly $10 billion a year U.S. gaming industry, with revenue for games increasing from $115 million in 2008 to $500 million from 2008 and 2009, according to a new report from Flurry Analytics, which helps mobile application developers make money.

link: IPhone games hit $500M, taking share – San Francisco Business Times:


300k Apps Approved by August

Apple leads the App Store race with 170,000 apps

Palm announced 2k apps on their store and Google recently crossed over 30k. Blackberry has 5k. Ovi maintains about 7k apps.

According to Appshopper there are 199,885 apps approved and 172,662 available on the App Store. (200k will certainly be crossed today March 21st). Due to churn and policy enforcement Apple has removed 27,223 apps from its store over the years.

In the case of Android, policing may not amount to much catalog erosion so the 30k figure is more comparable to the “approved” Apple figure.

With 27th the deadline for inclusion by the April 3rd launch date, the rush to submit new apps for the iPad is on. No doubt, there will be a significant surge in new apps in March. This might lead to a new record of over 25k apps added in one month.

My initial estimate in February for the 200k milestone was by May 1st. I was clearly off by nearly 40 days. If the add rate is maintained at 20k/mo 300k will come around in August although I’m not as confident in this forecast. The rate of app addition seems to be accelerating.


Palm Minnow is Swimming with Sharks

Palm CEO “I’ve never used an iPhone” Rubinstein quoted in the earnings conference call:

“We had an arrangement with Sprint that when we launched with Sprint that they would invest in marketing and carry the product and for that they would get an exclusive for a period of time. That really determined when we could do our launch at Verizon. I agree with your premise that if we could have launched at Verizon earlier, prior to Droid, that we would have gotten the attention that the Droid got and since I believe that we have a better product, I think we would have even done better.”

So we are led to believe Droid launched into a window in Verizon’s launch schedule. A window which was shut to Palm due to their exclusive with Sprint. It’s a matter of timing.

Then again, Droid got $100 million in advertising and marketing budget from Verizon and Motorola. It’s unlikely that Palm could leverage that kind of muscle, and their product ended up being positioned on a female demographic.

Palm was either late or under-funded or mis-positioned or all of the above.

Essentially, Palm’s problem is not the quality of the product (which is arguable) but their ability to market and distribute in a highly competitive market. In other words, it’s not that they’re not smart enough, but that they’re not strong enough.

Sadly, it’s not enough to be smart or good. They’re in the wrong market if they think having a clever product is a winning strategy. Mobile Computing is the toughest technology market today. Because the stakes are so huge, it’s a market that is targeted by enormous resources.  This is no place for start-ups.

Palm is simply too weak to make it.


Palm sell-through down 15% year-on-year

Smart phones sold to retail customers totaled 408,000 units, down 15% from a year earlier and 29% sequentially

By some estimates, Apple pre-sold more iPads online in one week than Palm sold smartphones through Sprint and Verizon stores in 3 months.  What’s more remarkable is that year-on-year decline implies Palm sold more Windows Mobile devices than WebOS which was not on the market a year ago.

link: Palm Narrows Loss but Retail Sales Decline – WSJ.com

  • The company said there are over 2,000 apps in the Palm App Catalog.
  • ASP was $367, down from $375.
  • Almost all volume was from WebOS products (Windows Mobile devices are gone)
  • For Q4, the company expects revenue to be less than $150 million.
  • Q4 gross margin likely in the mid-teens.
  • Guidance for $150 million in revenue, down 57% sequentially.

After hours market cap for Palm is about $833 million down 13%.  Expected revenue and ASP imply about 410k units will be sold into the channel in the following quarter.


Sources tell WSJ iPad to outsell iPhone within 3 months of sales start

Apple Inc. is still negotiating lowered-priced content deals from media companies for its iPad ahead of the device’s April 3 launch, The Wall Street Journal reported Thursday on its Web site, citing unidentified sources close to the matter. Apple has already sold hundreds of thousands of the devices on pre-order, according to the Journal. The sources also told the newspaper that the iPad may outsell the iPhone within the first three months after launch.

My emphasis.

link: Apple still negotiating iPad media deals: WSJ – MarketWatch

That does not seem to be quite a huge feat.  The iPhone sold 1 million within 74 days and approximately 1.4 million in the first quarter.

With “a few hundred thousand” pre-sold it seems rather likely to me that an additional million for three months is not a stretch.

Microsoft Taketh Away

Summarizing the new Windows Phone 7 Series:

  1. No Multi-tasking — However, there are going to be notifications.
  2. No App Sideloading
  3. No App store other than the Microsoft App Store
  4. No Cut/Copy/Paste
  5. No Expandable Storage
  6. No Exposed File System
  7. No Shell Customization / Skinning
  8. No native applications (managed code only)

Funny how when iPhone came out and Ballmer laughed his head off, these were the “power” features that most pointed to in WinMo that made the iPhone a “toy”.

Maybe if people want an iPhone copy, they will get an iPhone.

UPDATE:  (via Gruber)

Catching up is hard. And based on what I’m hearing about iPhone OS 4.0, it seems likely that Windows Phone 7 is going to fall further behind before it even gets a chance to ship.