On Monday, Apple Inc. (NASDAQ:AAPL) released study results that show that its App Store facilitated sales of around $458 billion from various categories. The categories include ride-hailing, retail on physical good, and advertising in which the company doesn’t take any commission.
Apple generated $519 billion from App Store billing and sales
The Apple-backed study denotes the first time the iPhone maker has tried to quantify activity for its App Store, which does not offer any commission. The company has been relying on commissions from the Apple Store to drive sales as iPhone sales decline in recent times.
According to a study conducted by Analysis Group, the App store had a huge impact generating around $519 billion in sales and billings last year. The consulting firm indicated that out of the amount, around $413 billion came from physical goods and services. This included ride-sharing, travel, and buying food and clothes.
Equally, around $45 billion was from in-app ads like social networking apps. The rest of the overall App Store activity of around 15% accounting for around $63 billion was from digital sales of goods and services. These include in-app purchases, games, and app downloads, as well as video and music subscriptions.
Apple accused of creating an unfair playing field with its model
Usually, the company takes between 15% and 30% as commission for digital sales through its App Store. This practice has attracted growing antitrust criticism across the US and Europe with competitors like Spotify Technology (NYSE:SPOT), indicating that this model hurts their business. Spotify always asks its users to sign for subscription on their site, which adds more steps compared to paying within the App Store. The company is being accused that it is exerting a lot of power over developers.
Tim Cook, the CEO of Apple, in a statement accompanying the study, indicated that the App Store is offering theme enduring opportunities in this unsettling and challenging times. It offers opportunities in education, job creation, entrepreneurship, and health, helping people quickly adapt to a changing environment.