Apple’s App Store already close to becoming a billion-dollar business?

“As Apple’s 9-month young App Store redefines the smartphone industry and spawns copycats, actual app sales are approaching a frequency that could see the digital shop become a billion-dollar business before year’s end,” Sam Oliver reports for AppleInsider.

“In a report on quarterly smartphone market trends released Tuesday, Needham & Co. analyst Charlie Wolf noted that the number of applications on the App Store recently surpassed 25,000, with actual downloads exceeding 500 million,” Oliver reports. “‘[T]he iPhone App Store has redefined the smartphone industry,’ he said. ‘In a game of ‘follow the leader,’ most operating system platforms, including Android, Windows Mobile, Palm and Symbian, announced they were opening similar online stores.'”

Oliver reports, “Attempting to quantify actual dollars generated from app sales (which Apple doesn’t report specifically), the analyst backed his way out of a reported $303 million increase in the company’s ‘music-related sales’ for December quarter, which includes sales from the App Store/iTunes Store. Assuming iTunes sales were flat year-over-year but iPod accessory sales grew in line with the players themselves, he subtracted $100 million to arrive at an App Store sales estimate of $203 million for the three-month period ending December.”

Oliver reports, “If accurate, the assessment would have the App Store generating approximately $800 million on a yearly basis, already surpassing a ‘neutral’ case scenario for the 2009 calendar year outlined by fellow analyst Gene Munster of Piper Jaffray last June. With the number of applications downloaded each quarter only increasing, it’s conceivable the store could reach the $1 billion milestone and possibly Munster’s $1.2 billion ‘Aggressive’ case scenario by year’s end.”

Full article here.

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