In an unprecedented year, Apple’s App Store was more popular than ever, topping more than $64 billion in gross sales in 2020, according to CNBC. In 2019, App Store gross sales were estimated at $50 billion and, in 2018, Apple's App Store had gross sales of $48.5 billion. Though Apple did not confirm CNBC’s estimate, the company broke down the success of its products and services in a January 6, 2021 news release.
“Now more than ever before, customers around the world have found inspiration and value in the breadth and quality of Apple’s services, which have impacted their lives in big and small ways every day,” said Eddy Cue, Apple’s senior vice president of internet software and services. “We’re incredibly optimistic about where we’re headed, and we believe that the opportunities for developers and the creative community are endless, as are the positive and meaningful benefits to our customers.”
Here are some 2020 highlights.
Apple's App Store highlights
Last year, when so many of us were isolated or quarantined by the coronavirus pandemic, people used apps to stay connected, conduct business, relax and unwind.
- The most downloaded apps of the year included Zoom (video app), Disney+ (streaming service), Among Us (game), Roblox (game) and Genshin Impact (game).
- Customers did much of their holiday shopping in the App Store, spending $1.8 billion on digital products and services between Christmas Eve and New Year’s Eve, primarily on games.
- On New Year’s Day 2021, shoppers spent more than $540 million in the App Store, setting a record for single-day sales.
- To date, developers have earned more than $200 billion since the App Store’s launch in 2008.
- Starting in 2021, small and indie developers can participate in the App Store Small Business program, reducing the revenue share developers pay to Apple for selling their digital products in the App Store. The revenue share is not-so-affectionately known in the industry as the Apple tax. Businesses earning up to $1 million per year will pay a 15% commission to Apple, half of the 30% commission they paid previously.
Apple Music highlights
Apple Music, Apple’s streaming music subscription service, enjoyed a record year too. With more than 70 million songs and 25,000 exclusive radio episodes, Apple released a product update last year with new features including personal radio stations, auto play and new search features. In August, the company renamed Beats 1 to Apple Music 1 and launched Apple Music radio stations, including Apple Music Hits from the 1980s, 1990s and 2000s and Apple Music Country. Apple Music is available on iPhones, iPads, Apple TV, Mac, Apple Watch, iPod touch, smart TVs, smart speakers, Android and Windows devices, and online at Music.Apple.com. Non-subscribers can try Apple Music for free for three months. After that, the streaming music subscription service can be purchased for $9.99 a month.
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Apple TV highlights
The Apple TV app is available on more than 1 billion screens in over 100 countries and regions. Apple TV+, Apple’s streaming subscription TV service, launched in November 2019. The service has since premiered some Apple Originals like Ted Lasso, The Morning Show, Wolfwalkers, Little America and other shows. It is not clear, however, how many paying subscribers Apple TV+ has attracted. Apple has offered free subscriptions to consumers who purchase certain Apple products, and they’ve offered generous free trials to attract viewers. The streaming service does not seem to be a flop, but aside from awards, it is hard to measure the success of the service.
For 2021, the tech giant has more Apple Originals lined up include news seasons of Dickinson, Servant, The Morning Show, See and For All Mankind, new series Losing Alice, and a documentary about Billie Eilish.
Apple’s 2020 announcement did not say much about Apple News or its subscription-based counterpart, Apple News+. The news service has a lot of magazines, thanks to Apple’s acquisition of Texture a few years ago, but it is lacking in hard news sources. In fact, in 2020, The New York Times withdrew from Apple News because it didn’t feel like the relationship was helping it reach paying subscriptions. One new addition that could help is Apple News Today, a daily audio briefing that can help Apple attract news consumers who prefer to hear rather than see or read their news.
Other Apple services
In December 2020, Apple Fitness+ launched. Working in conjunction with Apple Watch, subscribers can get studio-style workouts at home, compete with other users, and measure their workout stats. Given the continued state of the pandemic, at-home workouts are likely to remain popular into 2021, a good opportunity for Apple Fitness+ to gain popularity.
Apple Arcade garnered a brief mention. Apple said it has more than 140 games, called its subscription service “award winning,” but did not say much else. Apple Arcade is now competing with similar cloud-based mobile gaming services including Google Stadia and Amazon Luna.
Apple noted that Apple Books has more than 90 million monthly active users who access the service to read ebooks and listen to audiobooks. Apple also mentioned Apple podcasts but didn’t provide any statistics.
Bottom line: Apple's App Store and other services enjoyed a banner year in 2020, as people sought out digital products and services to try to achieve some normalcy in their lives. Interestingly, Apple did not mention its new Apple One subscription bundles that allows Apple consumers to bundle their Apple subscription services together to save money. This was either an oversight on their part, or Apple One has not yet achieved the success the company was hoping for. From a product and service standpoint, we expect Apple will devote additional investments into the subscription services that will do well to bring in recurring revenue (e.g., Apple Fitness+), pull away from services that don’t (Apple Arcade), and do its best to avoid antitrust issues which are likely to be a focal point of 2021.