Medialets

As millions of new smartphone users access thousands of new apps on their iPhone, Google and Blackberry devices, we have re-architected our Medialytics Data Server Infrastructure to meet the explosive demand for data. Now, Medialytics can provide publishers and developers with an even clearer and more valuable picture of user analytics.

Our goal in re-architecting the existing Medialytics data infrastructure was three-fold and symbiotic:

• Design for aggressive scalability
• Offer precise user-metrics
• Serve timely, near-real-time data

The stability of the new Medialytics technology stack, in conjunction with improved sub-systems, now allows us to collect an unprecedented amount of user data and offer it in aggregated, multi-tiered analytical reports. For example, future reports may display which apps were run on a unique Nexus One device in Kansas during the NCAA Basketball Tournament.

In addition, a new underlying event-processing system now allows for autonomous server activity which helps drive data delivery and processing when performance and response times are at their most critical.

So what does all this mean to the speed in which your data is collected and shared? Where user-metrics were available within the same day, they can now be available multiple times within an hour.

Visit Medialytics.com to sign up for your own Medialytics account.

We’ve been busy adding new features to our App Store metrics.  Here’s a summary of what we’ve added:

• RSS feeds of new apps, top free apps, top paid apps, and updated apps
• Enhanced graphics on the main metrics page, making it easier to spot trends in total ratings and average ratings
• Chart counting iPhone applications at each price point
• Display of more company data about the developer of each app on the individual app view
• Screenshots now included for each app
• Developer pages, showing what apps each developer has built, and a URL to the developer’s website

Let us know what you think in the comments and tell us what else you would like to see.

There’s a lot more to come so stay tuned!

Wow, this chart looks almost identical to 12 days ago! Sure, there’s an increase in total volume, and the Entertainment category has shrunk considerably due to the creation of a Books category, but in the main, the breakdown of apps by category on a total store percentage basis hasn’t changed much. 

So, let’s get the basic stats out of the way first.  As of Sunday night at 11PM, there are 977 apps available at the store. Of those, 254, or just over one quarter, are free.  The two categories with more than one half of their apps in the free bucket are Social Networking (93.9% free) and News (73.3% free).  The $0.99 category is the second most popular, accounting for 226 apps, or 23.1%.  The fact that almost half of the apps at the store can be had for less than a buck certainly could help account for the staggering download statistics that Apple is quoting!  The 99 cent-ers are dominated by a wealth of books by AppEngines, LLC, which accounts for 111 of the 226, or about 50%.  Entertainment, Games and Utilities make up the lion’s share of the remaining portion of this $0.99 group.

The $1.99, $4.99 and $9.99 price points are each holding about 10% of the market.  Games dominates all three of these, making up 48.5%, 42.9% and 27.5%, respectively. The other big category for the $9.99 apps is Travel, with the iLingo & Lonely Planet foreign language phrase books being the big offerings there.  However, given that most of the Lonely Planet printed guides are available at their website for the reduced price of $6.29, we may be seeing their prices coming down in the near future.  The joy is that since Apple has left pricing completely at the discretion of the developers, they can each determine what level of downloads justify what price point.    

The average price across all apps is $4.96 and the average price of a paid app is $6.70.  However, we have recently seen some higher priced apps enter the market, such as the two MyAccountsToGo apps coming in at $449.99 a pop, released on the 15th, and iChart EMR at $139.99, released last week.  However, as one would expect, these six apps in the over $50 range are all have very specialized target users.  If we ignore these six apps, the average price for a paid app drops back to $4.96.    

The largest single category by far is still Games, with 256 apps and an average user rating of 3.90, compared with a store-wide average user rating of 3.60, and a store-wide average user rating of 3.46 when Games are ignored in this calculation.  This single category, of the 19 categories currently available, is accounting for just over 25% of the total store offering!  This particular segment is breaking from some other overall trends to boot.  Only 11.7% of the Games are free; way below the total app store average.  The average price in this category is $3.75, which is also well below the overall average for the store.  The average price for a paid game is $4.18, again below the store average as a whole.  To further this point, if we exclude Games from our store average app price calculations entirely, we find out that the average price for all apps climbs 47 cents to $5.43, the average price for a paid app is up $1.89 to $7.85 and the average price for a paid app excluding the six big dollar apps is up $0.36 to $5.32.  Obviously, Games is skewing the overall picture on pricing in the store.  They are more plentiful than anything else, and on the whole, cheaper, and better received based on the ratings.

The real kicker is that Games are dominating the leader board, with 53 of the top 100 paid apps coming from this category – that’s 23.5% of the available paid Games apps out there.  The average rating for these 53 is 3.84, compared with the overall paid Game rating average of 3.75.  Ignoring Games, the average rating for the remaining 47 apps drops to 3.21.  In terms of pricing, the average price for Games in the top 100 is $5.52 versus $4.61 for the other 47 apps.  If we narrow that list down to the top 25 paid apps, Games make up 16 of those, with an average rating of 3.88.  Granted, Music and Navigation have a greater percentage of their paid apps in the top 100, but combined they only represent 12 apps.  And no other category in the top 25 paid list has average user ratings anywhere near as high!  In fact, if we ignore games from the top 25 paid apps, the average rating for the remaining 9 apps drops all the way down to 2.79.  The average price for these 16 apps is $6.30 versus $1.99 for other 9.  The average rating for all paid apps store-wide is 3.37, for the top 100 paid apps, it is 3.63, and for the top 25 paid apps, its 3.67.  So, it looks like Games are doing pretty well compared to the other categories in both the paid download rankings and paid apps ratings.

On the free side, there are 24 in the top 100, which is 80.0% of the total free Games available.  They hold spots number one, two and three here.  By comparison, the second highest on the free leader board in terms of percentages is Entertainment, with 18, or 62.1% of its 29 free apps, ranking in the top 100.  The average rating for the 21 free apps is 4.18.  For top 100 free Entertainment apps, the average rating is 4.12.  Looking at the top free 25 only, Games have 7 of these, with an impressive average rating of 4.47.  For Entertainment’s 6 in the top 25, the average rating is 4.37.  The overall average user rating for free Games is 4.15, for all free apps store-wide is 3.76, for the top 100 free apps, it is 3.85 and for the top 25 free apps, its 4.06.  So, it looks like Games is doing better than average here but its a little tighter than on the paid side.

So, the free apps, be they fewer, are contributing to the overall higher ratings of this category.  One could ask, how much does pricing seem to really matter?  Let’s take a look at the pricing breakdown in detail and see if we can learn anything:

Within Games, there have been 22 price changes from July 15 to July 25 and 35 new apps hitting the store.  Twelve days ago we had 31 Games apps at a price of $9.99.  Today there are only 25.  Where did they go and does it seem to have paid off?  

Looking at the details, I see there are 7 games that have dropped their price from $9.99, in all cases going to $4.99, which accounts for the majority of the increases we see there.  None of these apps are in the top 100 paid apps list and it doesn’t appear to have greatly affected their ratings, dropping from 3.48 to 3.35, over a total of 73 and 122 ratings.  So maybe these games need to either rethink their pricing strategy further, or possibly they need to retool their apps a bit.  

There is one new app at $9.99 that was released on 7/18, and its getting an average rating of 4.50 from 68 reviewers so far.  The weighted average rating for the 25 $9.99 apps is only 3.65, so this one seems to be doing okay.  Of these 25 apps, 13 of them hit the top 100 download board.  Only 5 other apps priced at $9.99 hit the top 100 (3 Productivity & 2 Music).  

For the other 10 apps that have dropped their prices, 5 dropped a dollar and five others dropped anywhere from 2 to 4 bucks.  For the one dollar drop, we see an increase in average rating from 3.56 to 3.66.  For the greater than one dollar drop, the ratings actually drop from 3.89 to 3.74.

Four games have actually raised their prices in the past 10 days, in all cases by $1.00.  Three were increased from $1.99 to $2.99 with apparently little effect in their ratings.  Of these, only the app now at $7.99 has enough reviews to see if this change has had an impact.  The ratings here have gone up from 4.1 to 4.2.

Okay, now that your head and mine are swimming with numbers (which in the absence of actual download numbers only mean so much), lets see if we can come up with some take-aways.  The relative mix of apps by category hasn’t changed much and we can probably expect to see this continue in this fashion.  The percentage of free vs. paid is staying relatively stable across the store, although the average price seems to be increasing slightly.   The overall ratings for free apps seems to be higher than paid apps, whether we look at the store as a whole, the top 100 or just the top 25.  People love their Games!  The user ratings are higher here and people are willing to pay for good Games and seem to be sampling far and wide.  Further, a drop in a Game’s price doesn’t equate into an increase in user satisfaction, so it appears that at least for Games, our user community is looking for quality at whatever price (13 of those 54 on the top 100 paid download’s board are priced at $9.99, and 5 are at $7.99, while only 12 are at $1.99 & $0.99 price points combined).

Now that apps are only being reported in a single category, we can give you a new view of what’s going on with the store.  As of 8pm, the total app count was up to 802.  Store wide, 22.7% of all apps are free, 23.8% are selling for $0.99, and 9.7% are selling for $1.99, while only 5.6% of the apps are priced over the $9.99 mark, as clearly indicated in the chart below:

Okay, maybe that isn’t clearly indicated in the chart, but a few points do jump out, and most of it turns out to be what we all expected.  First, the majority of the apps in the store right now are in the Games and Entertainment categories.  Combined, they account for 393 apps or 49% of the total current store offering. Second, the biggest single item on the chart is Entertainment apps at the 99 cent price point.  A whopping 122 apps fall into this bucket, representing 15.2% of the total apps.  The competition in this area is going to be fierce.  The second, third, fourth, fifth and sixth longest colored bars in this chart are all in the Games category, representing the $1.99, $4.99, $9.99, $2.99 and $0.99 price points, respectively.  

Other things that jump out at us on the chart…  Travel apps seem to be most concentrated around the $9.99 mark, over half the Utilities apps are under a buck and just under half of the Productivity apps are free.  Social Networking apps are almost all free.  That little yellow at the end of their line is the $9.99 versions of Twitterific Premium and Exposure Premium.  Both of those apps are available for free in scaled down version.

Personally, I like to look at my data in tables.  Ahh… raw numbers.  Makes my heart feel warm and fuzzy.  

As we see a trend away from free in the app store, it will be interesting to see how the price points trend within the individual categories.

As of Friday, July 12, around 5pm, we were seeing 649 distinct apps in the store.  However, 457 of those applications were listed in two different categories in the store, for example Sextuple Word Challenge was listed in Games and Education.  And one, Xhake Shake, was actually showing up in three categories (Entertainment, Games & Sports).  I noticed earlier today that this is no longer the case.  Each of the 794 available as of 3pm EST today are now listed in a single category only.  While this change will certainly make our reporting life much easier here at Medialets, I wonder what impact this will have on revenue for the paid apps.  Is this going to make is easier or harder for app store users to find the “right” app?  

Earlier today I put it out there for anyone motivated enough to calculate it using some of the volume data that Apple published earlier today.

It’s been on my mind all day (which people have told me says something…I guess) so I went ahead and did it.  But there is a “health warning” regarding the consumption of this information.  Its not revenue – its really a price * volume proxy – lots of assumptions, but again, done in the spirit of transparency.

We start with our earlier premise that in the absence of download volume, we would use the number of reviews written for an app as a proxy for relative volume comparisons.  As of 7/13, written reviews for paid-for apps outnumbered those for free apps by about 25% (that’s about a 55/45 ratio). So:

If there were 10 Million downloads, then using the ratio above, we’re left with about  4,450,000 for paid-for apps.

Next, we know that there were 2,623 reviews written for paid-for apps. Dividing this into the number of reviews that an app received gives us the “share” of reviews for an app – which translates to our proxy for share of volume.  Multiply this by 4,450,000, and again by the price to get an estimate of relative financial position vs. other apps (I don’t feel it’s qualified enough to be called revenue yet).

So, if Super Monkey Ball has 290 reviews, the following happens:

290 = 11.1% of paid-for reviews.  11.1% * 4,450,000 * $9.99 = $4.9M.

There, I did it.

But remember, this is not revenue!  It’s a way to gain more insight into how pricing and demand affect the relative financial performance of an app.  Here is a table of a few I’ve done for you.

We’d love to hear your feedback on this.

A boss once told me that launching a business is a lot like Indy car racing – with no sleep of course. Aside from a roar at the start, there are also a lot of crashes and mechanicals – (see where I’m going with this). The thing is, when there’s a big cloud of smoke ahead, you have to have the resolve to trust your team, your dashboard and your telemetry, grip tight, and drive through it.

Did I make any money?

That’s the question on everyone’s mind. How did my app perform? How has it done vs. others overall? In my category? How about with others of the same price or vs. free apps? What’s the big picture?
We’ve been gathering and crunching away at data all weekend long, and here are some of our observations and analysis.

Yes. It’s behaving like a market.

Prices are falling as more apps are added. We learn in Econ 101 that as more competitors enter a market, the more likely we are to see price compression for an unlimited resource. We’ve been reviewing the App Store more or less hourly since it became available on-line, and (barring some ‘mechanicals’ from Apple), the trend over time seems to indicate that this may already be happening (Chart 1). I say “may” only because these are app owners’ initial bids into the market – we have not seen much activity in terms of price changes yet, but are less than 100 hours into it.

Is a proliferation of free apps driving this pattern? Chart 2 indicates that it isn’t. In fact it is a very similar pattern.

Competition can be “ugly.”

If you’re not the lead dog, the scenery never changes. People are taking advantage of weak points in the App Store process to get noticed. You will see the same behaviors if you look in the Yellow Pages. Here are the top 10 app names in alphabetical order as of around 7pm last night:

• !! Solitaire City !!
• !FLOverload!
• “CubicMan Deluxe”
• “Whack The Groundhog”
• “Jam’
• “Jirbo Break’
• “Jirbo Jive’
• “Jive’
• “Marble Mash’
• “Paper Football’

Strong desire for transparency.

How much money did I make yesterday/to date, etc.? For a while, the App store was publishing number of downloads, so you could directly see the performance of your application. If you were scrappy enough, you could benchmark vs. other apps. Which we did. Until Apple shut the counter down after about 15 hours. I can’t blame them. Where I come from, publishing real-time revenue for a publicly traded company leads to unemployment. However, now that Im on the other side, like many others, I’m pushing for price transparency – I want to see where the market is going.

The next best thing, we think, is to measure download activity by proxy using number of reviews posted. It does not give us insight to revenue, but it may be able to give us relative perspective on volume as a benchmark. The thinking is that the more an app gets downloaded, the more likely people will post reviews. I’ll let you figure out the math to interpret this vs. the 10 Million downloads Apple reported this morning. In the meantime, here’s a snapshot of one of our leaderboard tables that we have started publishing and updating 4 times a day (and boy are our fingers tired!).

Free is “Better”

At least that’s what the stats coming out of the first 3 full days of operations are saying. Using our volume proxy of reviews submitted, Chart 4 shows that free apps generate anywhere from 24% – 29% more reviews than paid-for apps do.

The obvious follow-up question is “OK, but are they of similar quality as paid-for apps?” We tested this, and were actually surprised to see that the average rating (on a 5 point scale) was higher for free apps (Chart 5).

It’s Your Market, Too

To carry on the racing analogy, we haven’t even reached the first turn, and there already are some smoke patches to drive through. At Medialets, besides providing specific metrics for our application development partners, we are trying to help the market become more efficient in general. We’d love to get your thoughts on some of the data we are publishing. Let us know how we can make this better or other ways you might like to understand the changes in this market and we’ll get our pit crew right on it!