Analyst puts dollar amount on apps value to Apple

Analyst puts dollar amount on apps value to Apple
Toni Sacconaghi is an analyst with brokerage house Sanford C. Bernstein and his research shows that Apple rakes in $150 million dollars a year from the 30% commission the company gets from App Store revenue. The analyst feels that the figure will grow rapidly, but right now it pales compared to the $2.8 billion in hardware sales that the iPhone has generated in the 6 months up to March. And the beauty of the set up is that third party developers are the ones putting up the costs to create the applications.

Sacconaghi feels that the App Store serves Apple best as a way for the iPhone to stand out among the crowd of current smartphones available. Right now, he points out, an iPhone user has more than 50,000 apps to choose from versus 2,000 for BlackBerry owners using RIM's App World. Another advantage comes from the efficient way the guys from Cupertino spend money on R&D. Last year, the company spent 3.4% of its revenue on research and development compared to the 6.2% used by RIM and the 12% to 15% spent by Microsoft, Google, Motorola and Palm.

source: WSJ

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