PODCAST: Tomi Ahonen Warns App Store Model Doesn’t Pay; Is The Blockbuster App Model Bankrupt?

Topic: Media, Mobile Apps | Author: Peggy Anne Salz | Date: July 12, 2010

Android apps PODCAST: Tomi Ahonen Warns App Store Model Doesnt Pay; Is The Blockbuster App Model Bankrupt?In brief: We’re back with another look at the mobile trends and numbers that matter most – with mobile pundit and all-around-great guy Tomi Ahonen. The main attraction is his must-read post that connects the dots in recent download stats to tell us just how much money developers are making (not). We also explore the rise (and rise!) of Android and how handset makers aligned with Android can achieve competitive advantage.

“iPhone Economics: It is bad news. And then it gets worse.” The title of this blog post from Tomi Ahonen says it all. In it Tomi does the math, matching figures from Apple with stats from other analyst houses to conclude that most app developers can count on breaking even sometime in 2021.


What is the methodology and – more importantly – what is the message to investors?

I caught up with Tomi during MedienForum NRW (PDF), a milestone cross-media conference that took place on June 30th in nearby Cologne. Tomi gave the keynote at the Mobile Media Summit, a mobile-focused event expertly organized by Mark (Mr. Mobile) Wächter, bringing together some great mobile minds and strategists including Mark Curtis (Flirtomatic CEO), Gerd Leonhard (media futurist), Ajit Jaokar (author), Michael von Roeder (Iconmobile COO) and John Gerosa (Vertical Leader, Technical Markets, Google).


Ahonen PODCAST: Tomi Ahonen Warns App Store Model Doesnt Pay; Is The Blockbuster App Model Bankrupt?Tomi also documents the rise of Android and the success of its ecosystem approach that could see over 100 handsets on the market by the end of the year. What did Google do right and where did Apple (potentially) lose the plot? As Tomi sees it: Apple will pay dearly for being a control-freak. “Apple is alone, one manufacturer with one new phone a year. RIM Blackberry is alone, one manufacturer with eight phones. How can they compete against 30 manufacturers and 70 phones today?”


The app model is flawed now – but things will get better. Meantime, investors are well advised to see the app market dynamics in a new light. It’s not Hollywood, where blockbuster hits make up for all the misses. “Hits business is what people thought the Apple App Store was like. Now we know the reality is much, much, much, much worse. It is not a ‘hits business,’ it is a lottery business. You really have to be supremely lucky to have that one application that is a success – then you might make millions. But, remember, there are 170,000 other people who did not make the millions. The odds are nowhere near as good as in Hollywood.”


It comes from the U.K. and underlines just how very personal our personal mobility has become (!)


[Listen to the podcast here and pass it on! 14:57]

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3 thoughts on “PODCAST: Tomi Ahonen Warns App Store Model Doesn’t Pay; Is The Blockbuster App Model Bankrupt?

  1. Hi

    I’m very interested in tuning in to anything mobile and especially anything Tomi puts out but it would be so much more accessible if the podcast could be downloaded and listened to on, say, an iPhone ;)

    (If by some longshot you don’t know, this is a checkbox generally on the podcast plugin settings)

    Or be able to subscribe via iTunes and listen to it in the same way.

    After all we are talking about mobile!

    Many thanks


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