$1.2 Billion For iPhone Apps in 2009?
Thursday, 12 June 2008
WashingtonPosts Erick Schonfeld takes cuts at Piper Jaffray analyst Gene Munster and his predictions that the iPhone App Store could be worth $1.2 billion by the end of next year.

"Let's take Munster's neutral case. He estimates 77.7 million active users will get two apps each (155.4 million total). But if 70 percent of those are free, that would bring in only $466.2 million in revenues instead of $777 million. And if the price drops from $10 to $3, that further reduces the revenues to $140 million. For his aggressive scenario (where he is essentially assuming that 121 million apps are sold at $10 each), the total take would drop from $1.2 billion to $364 million.

But wait. We still have not addressed his second major questionable assumption. The total number of Apple iPhons that will be out there by the end of nextyear. His 55 million "conservative" estimate is anything but. So far, Apple has sold 6 million iPhones since it launched nearly a year ago, and is on track to sell 10 million total by the end of 2008. Munster thinks it will be able to sell 45 million in 2009, or more than seven times what it sold during its first year. Yes, the price cut ( if you can call it that) to $199 will spur more sales. But not 7X more sales."

Read the full story on WashingtonPost.com.
 
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