Apple's apps economy 'as big as Hollywood'

Some app developers earn more than Hollywood stars, according to Asymco analyst Horace Dediu

Apple's app developers earned as much collectively as Hollywood did from US box offices in 2014.

Apple recently revealed that apps generated over $10 billion (£6.6bn) in revenue for developers in 2014, while Hollywood also took $10 billion in box office revenues, according to Box Office Mojo.

While Hollywood’s revenue stream is made up of more than just US box office takings, Horace Dediu, founder of analyst firm Asymco, pointed out that the app economy is also made up of more that Apple’s App Store billings.

"The Apps economy includes Android and ads and service businesses and custom development. Including all revenues, apps are still likely to be bigger than Hollywood," he said.

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^{Graph: Asymco}

The app industry is also healthier than Hollywood, sustaining many more jobs (627,000 iOS jobs in the US versus 374,000 in Hollywood). It is easier to enter, has a wider reach, and offers a higher median income (many actors earn less than $1,000 a year).

Mr Dediu noted that apps are now a bigger digital content business than music, TV programmes, movie rentals and purchases put together. Apple passes 70 per cent of app revenues directly to developers – a much larger proportion artists in other formats get.

"The curious thing is that even though the medium of apps is swamping other forms of entertainment in all measurable ways, comprehension of the phenomenon is lagging," he said. "Information asymmetry is a wonderful thing."