News, App Store developers not getting rich (2009, profit, millionaire)

[revelated]

Though it has to do with a wireless device, the real backing of the article has to do really with business savvy, not the device and not wireless technology, so I posted here.

The whole article is a good read:

iPhone App Store Developers Aren't Getting Rich | Newsweek Smart Business | Newsweek.com

But I wanted to bring to light this one snippet:

Originally Posted by Newsweek.com

But even App Store equivalents of the King of Pop and the Material Girl are struggling. In 2009, Ethan Nicholas left a job with Sun Microsystems after making $800,000 in just five months with his simple artillery game called iShoot. Today, the App Store icon from North Carolina is himself staring down the barrel of a gun, struggling to produce another hit game after iShoot was buried by competitors and copycats. "It's terrifying," says Nicholas, who says he is "not a millionaire" and describes iShoot's success as "pure luck." Despite spending eight months and more than six figures developing a second shooting game to be released this month, he says that he is still "very worried about being a one-hit wonder."

I don't get this. I mean I understand his thinking...but it's not forward thinking, which is why I'm confused. he had a a presumably decent paying job with one of the largest companies in this hemisphere, in a year when we are in a recession and jobs are not easy to come by, because he happened to make some money on an app. $800k isn't much after taxes and expenses in any case (assuming this is gross profit), and even if it were, it's still not an indicator of future success with the existing or additional applications. Meaning, if I develop an application that's a hit, my first might not be nearly as good as my second (Look at Windows Millennium vs. Windows 2000), or vice versa (Windows XP vs. Windows Vista). Therefore, I would not be quitting my job until I see three things happening.

1: A steady, if not upward trending, stream of income from my initial application.

2: A clear demand for a second application. Meaning feedback from those who purchased the first application OR so many copycats as to negate the future profits of the first.

3: A downward trend of development cost and backend expenses. In other words, if I netted $800k after it was all said and done, paid off every expense and only have development costs at a fraction of my net income, then and only then would I look at dropping the job, but only after 1 and 2 have been met.


A lot of these AppStore guys seemed to just jump in there, make some cash, and then get bigheaded, thinking they could leave their 9-to-5. Such thinking is the problem with entrepreneurship in this country...too many people think it's easy when it's not. A one-hit wonder isn't a guarantee. Don't leave your job until you can call aces on the 3 bullets above. If any one of them is missing, you're going to fail before you even start.

[HappyTexan]

I agree with you. I'm a programmer and the net is full of stories like this.

Normally it's very hard to go out on your own with software.
Shareware is ok but don't count on it.
Those iphone/ipod touch apps would bring in a nice side income and if that guy followed that path he'd probably be better off today.

Creating the "killer app" is not an everyday occurrance and he should have realized that.