Top 20 percent of App Store game makers split 97 percent of total revenue

by Phil Hornshaw

It turns out the iTunes App Store might be a little more like the Android Market than previously believed, at least in terms of the fact that many game developers struggle with exposure, while a small group rakes in a lot of revenue.

That’s according to a new unscientific survey from Canadian indie iOS game developer Owen Goss, who said he got responses from 252 game developers working in the App Store, according to a story from IndustryGamers. What he found was something to be expected: the best-known game makers receive a disproportionate amount of the total revenue of the App Store. What’s striking, however, is just how much. Goss’ survey found that the top 20 percent of game developers working in Apple’s market receive 97 percent of the total revenue that goes to games.

That’s a huge chunk, leaving 80 percent of developers to split a mere 3 percent of the remaining revenue. Goss, who is the founder of Streaming Color Studios, also determined from his survey that the top 1 percent of iOS developers get a third of that 80-percent chunk all to themselves. From the survey, Goss found that the top 25 percent of iOS game developers have pulled down more than $30,000 in lifetime revenue – but the bottom 20 percent have made less than $200. Another quarter said it had made somewhere between $1,000 and $10,000.

It should be noted that all these figures are the lifetime revenue of developers, meaning that the survey wasn’t going on a single app or a set period of time. Instead, it focused on what developers were making over the long haul in the App Store. Obviously, better established developers who have been in the app store longer are disproportionately among the top earners; at the same time, though, the survey raises some focus for further study.

As Goss notes in his blog posts about the survey, take this one with a grain of salt. The survey was conducted informally for the most part, and while Goss took steps to do a good job of creating his data set, this isn’t a scientific study. The sample size is at issue, as is the distribution of the survey. This one is more of an indicator of where the trends might lie than actual proof of the way money is distributed for game developers in the App Store.

But something that’s interesting is that Goss’ study paints a picture of Apple’s market as being a lot like Google’s Android market. The Android Marketplace is notorious for low exposure and difficulty with app discovery, and some developers have complained about making Android games and never seeing much in the way of money for their trouble.

Goss’ survey suggests that the same thing might be going on in the iTunes App Store, perhaps for no other reason than the fact that it has shown that developers can be successful. Like the California Gold Rush, the positives of the App Store have lured in a whole lot of developers hoping to strike it rich, and that can make the whole ecosystem overcrowded.

The next question – beyond verifying Goss’ findings with a full-on study – would be in determining what affect this distribution of wealth might affect game development in the App Store. The mobile sphere continues to grow (and likely will again when the iPhone 5 is announced on Oct. 4), so it’ll be interesting to see if more devs flock to the App Store despite the risk of finding Fool’s Gold instead of the real thing.