Apple App Store Makes Massive Profits
Written by Alex Denham   
Thursday, 28 January 2021

Apple App Store had gross sales of around $64 billion last year, according to a report from CNBC. The report estimates that the amount is up from an estimated $50 billion in 2019 and $48.5 billion in 2018.

The estimated figures would represent a growth in revenue of around 28 percent in 2020, as opposed to growth of 3.1 percent in 2019. The suggested reason is people staying at home and spending money on apps and games during the Covid crisis.

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Apple doesn't report sales figures, and CNBC estimated the amounts by looking at the amounts Apple said it paid to developers. This is a figure that Apple has released as a data point every January since 2008.

Critics of Apple have been vocal about the money Apple makes from its App Store, arguing it has too much power over the platform, and this puts developers at a disadvantage. Apple usually charges 30 percent for digital sales through Apple App Store, though it has recently changed its terms so that companies that make less than $1 million in App Store are charged only 15 percent. At the point the reduction was announced, The New York Times estimated that 98% of the apps in the Store would be moved to the lower rate but that this would only reduce Apple's income by 2.5%. As IProgramer reported at the time, "some gesture - you have to admire the cunning".

A congressional subcommittee ruling in 2020 said that Apple has monopoly power over iPhone app distribution, and that results in excessive profits for Apple in this sector. Apple is also being sued by Epic Games over the 30 percent fee it has to pay on sales of iPhone games. Epic Games has brought an antitrust case saying the fees are unfair and Apple is acting as a monopoly. Apple is fighting these claims in court.

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More Information

CNBC Report

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Epic Games Takes On Apple - Unintended Consequences

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Apple Is Playing With Us - App Store Tax Cut To 15%

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Last Updated ( Thursday, 28 January 2021 )