Why indie developers can't win on the App Store
blog.tapdaq.com
blog.tapdaq.com
Let's look at the numbers from a different direction: Apple reports that the App Store has 1.25 million apps earning $5bn in revenue last year. But 25 companies take half of the App Store revenue, leaving only $2.5bn for everyone else. That means that if you knocked out all 25 of the biggest earners on the App Store, the other 1.25 million apps would see their average annual revenue double to. . . about $4,000 annually. Hot damn! Call home, tell the spouse to put the Hamburger Helper back in the pantry, the kids are eating at Chucky Cheese tonight!
Everyone wants to be a game developer. . . but just like every other job that everyone wants to have, it ends up being a cutthroat business. The big players - the Apples, the movie studios, the recording studios - certainly don't do anything to make it better. But even without them it'd still be wretched place to try to make a living, simply because of sheer volume of competition. There's something to be said for having a day job to survive on while you're trying to make it.
As developers we should count our blessings in that department: unlike for so many other high demand careers, chasing our dreams requires developing skills that are also highly demanded for less glamorous work. We're fortunate to be able to practically default into fantastically lucrative day jobs that still offer reasonably enjoyable work.
By which I mean boring corporate jobs. Working long hours for low pay to go chase somebody else's dream at XYZ startup is probably the wrong choice here. Get the boring 40hr/wk corporate job. You'll make enough money to finance the stuff you really want to do, and better yet you'll have enough free time to actually do the stuff you really want to do.
1) They rely on the AppStore to do their marketing for them because you could get away with that in the early days (or if you make the front-page consistently). With 1million apps, that's not going to work. Turns out, you have to do the traditional thing and go and pound the pavement, and market your games yourself.
2) The price-points are crap. Selling software for $1 is crap-business, and not every game is compatible with the freemium or subscription model. You really need the price-point in the $20-40 range to be sustainable. You sell 1million games, and you get $700k?! Moving that many units is a massive success and yet all it does it maybe cover your development costs and rent.
3) There's a lot of shovel-ware out there, and it's just too hard to punch through all that noise.
Consider the $50 game vs $0.99 game. To make the same money from a dollar game you need to sell 50x as many copies basically. As an indie dev with minimal budget, making money in a market where significant revenue means significant volume, it is going to take a lot of advertising to make a dent.
What the bigger companies have done is made games that are F2P with a much higher value via micro transactions. Their revenue per install might be something like $10 whereas the indie dev who doesn't want to charge as much revenue per install might be closer to $5. That means the people with the higher RPI can advertise more or spend more per install and still be profitable.
It's not unfair to indies so much as it is that indies aren't charging enough to make the numbers work. Also, if indies don't have the cash flow to float that $5 per user over 12 months that it takes to get it, they aren't going to be able to afford the $2.50 CPI.
The same economics play out in many, many businesses. Business is always a game of balancing production, operating, and sales costs against revenue. Whoever is best at that wins.
Maybe indies just aren't very good at business.
I have said this other places, but I will repeat it here. Kudos to them for finding (or creating) a successful niche with high demand. I find it sad though that sooo much money is going to marketing games that don't push technology further, or really fundamentally help things get better.
You could argue that if you add up all the marginal increases in utility/happiness that are gained from playing any of the saga games that it might be a net gain, but I think that is a stretch. I find it tragic that this is how the market allocates resources (time and capital).
You mistakenly conflate cost to produce with value to consumers. Obviously the content has value to consumers.
You're attempting to twist the language so words don't mean what most people think they mean and I'm not buying it.
They should be worthless.
The funny thing with Candy Crush is that it's a free app. The only thing that costs money is if you want to "cheat" to get extra turns and goodies to help you get past levels. Totally defeats the purpose of playing a puzzle game, as far as I'm concerned, but they make tons of money off those who are fine with dishing out cash to see that next level sooner.
King.com Explicitly prohibits this (and a number of other things) when they advertise with ad companies. But there are always rogue elements (Probably the said websites in this case) that does these kind of things to drive install rate (and make money from King.com).
But if by "win" you mean "earn a comfortable living and possibly modest riches" then I doubt this thesis has any legs at all.
Build a good product, it will sell. Build an innovative product that scratches the itch of millions and you get onto the top 5 list.
What I see far too often is developers passing off a derivative or poorly executed idea, and complaining that the marketplace is the problem. It's not.
I'm not saying something is WRONG with the market, I'm making an observation about the state of the market.
I think by "win" they mean, "you broke even + $1".
She released stuff with XL Recordings (a label that had multi-million selling artists even back in the nineties) and then signed with Columbia.
Independent used to be somebody in a small label, like 4AD. Nowadays, it's somebody releasing his songs himself or such.
Adele hasn't qualified as such for over 5 years...
Just because they're incredibly successful, doesn't make them not an independent label. Changing the definition of "indie" to exclude XL makes the claim that 'indies aren't successful' a simple tautology.
Perhaps, but has the benefit that it keeps the definition of "indie" as "not a big marketing and sales behemoth" intact.
And that's more to the essense of being "independent" than "doesn't belong to a major record label".
If we're to accept incredibly succesful, large selling artists, big marketing as "independent", then what does distinguish major and indie record labels? Simply that it's not a conglomerate?
Graphics don't matter as long as you have a coherent style. Pre-written "story" is not critical to games, and enabling player creativity is something that will be eagerly received. One person really can make a great game all by themselves in a reasonable amount of time.
Amusingly, the only lesson learned by most developers is that people really want block-based worlds. Nah. If you look at Minecraft and Dwarf Fortress as just the beginning of what enabling player creativity in a simulated world can look like, that way lies the future.
The indie road to success is the path not taken by AAA games. There's so much potential for what games can be that hasn't been explored by mainstream publishers, and Minecraft is a superb example of that.
IMO it's quite possible to do well on the app store. Sometimes someone builds a great app, and it does marginally well, but Google or Apple notices it. They recognize that it's an interesting product and will likely at least call you about a job. Which in my book, would be somewhat of a success.
I've tried emailing a few blogs to get reviews, and now I'm trying to use Twitter (@h4labs). I'm building iOS language learning software. The apps could still use work but I think I'm approaching "useful."
The one interesting observation that I have is that since I wasn't making many sales at $1.99, I raised my price on Monday to $2.99. As of this morning, I already have as many sales this week as last week. In other words, for the people who want my app, the extra dollar doesn't mean much.
By the way, constructive, even brutal, feedback is always welcome.
Back to work... gotta get one more release before the holidays.
Also, I'm sure I'm not the first one to say it but you've gotta move to iOS7. Do the easy thing and try using all native color scheme. As a design exercise [2] it will help you focus on content.
Good luck!
[1] http://hackdesign.org/ [2] https://medium.com/design-ux/7348987453e3
However, you need to define "win". Just like in any other business if you want to make millions you need to put in big cash (just look at real estate). If you win by having a revenue that allows you a comfortable life, it's still doable.
I've been an independent developer for 4+ years and have been living on it since. I make mostly passive revenue with my apps and play tennis 2-3 times a week during the day. I certainly will not complain.