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 When Apple unveiled the app store, it was like a door flung wide open for countless inventive developers. With the iPhone ruling as one of the trendiest brands on the planet, the demand for iPhones is sure to skyrocket in the years ahead. And in the world of tomorrow, where smartphones reign supreme, this was a realm ripe with lucrative potential for the dedicated developers.

The past couple of years have proved wildly prosperous, birthing an entire ecosystem that previously didn’t exist. With millions of iPhones flying off the shelves around the globe, they’ve become a bona fide platform to peddle utility iPhone applications. In a single sweep, the iPhone app store has granted many an aspiring coder a means to make a living.

But how does it all work, you might ask? Well, the iPhone mobile apps in Apple’s app store aren’t always “sold” in the traditional sense. Quite a few are available free of charge. Some developers capitalize on sheer numbers, enticing hordes of people to download their apps, then racking up revenue through advertisements. Others opt to focus on value, offering their app at a price. While this approach may reduce the number of downloads, it allows the company to profit from each sale. For every app that’s sold, Apple takes a 30% cut of the product’s value. So a $0.99 app nets the developer around 70 cents and earns Apple a cool 30 cents.

This has become an absolutely thriving business. Recent research reveals that nearly 2 billion apps have been downloaded, with paid apps accounting for 30% of that figure. Taking into account all this activity, Apple’s annual revenue from the App Store ranges anywhere from $220 million to $440 million. This, in turn, means that developers have raked in a yearly bounty somewhere between $560 million and a staggering $1 billion.

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Ihab Salloum