A recent report by Vision Mobile laid out the expected revenues for an app developer by mobile OS. While the device itself is important to the whole smartphone user experience, it is the presence and efficacy of the apps available for it that will ultimately determine whether the platform will live or die. Microsoft (NASDAQ:MSFT) has taken a lot of heat for its windows Phone strategy, not the least of which comes in the form of the damage its done to partner Nokia (NYSE:NOK). The latest announcement that all previously made Windows Phones including the current flagship phone the Nokia Lumia 8/900 will not be upgradable to the latest version of Windows Phone (version 7.8 will be rolled out soon to add some of the features of Win Phone 8 not tied to hardware) has heaped a ton of scorn on the folks from Redmond.
So, what else is new, people don’t like what Microsoft does.
But what they do like is how they can make money off the products Microsoft produces, i.e. their platforms. And, surprisingly, Windows Phone is generating a ton more revenue per customer than Apple’s (NASDAQ:AAPL) iOS or Google’s (NASDAQ:GOOG). Windows Phone generates on average $1235 per app per month. iOS $3693 and Android $2735. But how many Android devices are out there? How many iPhones. That Windows Phone with its 3-4% market share is generating that kind of revenue means that a developer can expect to hit a larger portion of that audience. The same report also shows that it takes $17,750 to develop a Win Phone app. So, it takes 14 months to recoup the initial investment. For Android? 8.5 months. For iOS the number is 7.5 months.
Windows Phone has a long way to go to be competitive but the numbers are not insurmountable. High user engagement is a definite starting point.
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