iOS 18 could generate $400 million in app revenue

Apple’s practice of leveraging ideas from the third-party developer community to become new features and apps for iOS and Mac comes with a hefty price tag, a new report suggests. With iOS 18 released later this fall, Apple’s changes could impact apps that today have revenue estimated at about $393 million and were downloaded nearly 58 million times over the past year, according to an analysis by the app intelligence firm. Application forms.

Every June, at Apple’s Worldwide Developers Conference, Apple teases upcoming releases of its software and operating systems, which often include features previously only available through third-party apps. The practice is now so common that it’s been given a name: “sherlocking” — a reference to a 1990s Mac search app that borrowed features from a third-party app known as Watson. Now when Apple releases a new feature that was previously the domain of a third-party app, it is said to have “locked” the app.

In previous years, sherlocking apps made little sense. After all, does the iPhone’s flashlight really need to be a third-party display, or is it better to have a built-in function? Additionally, Apple was able to release features that made its software better adapt to consumers’ wants and needs by considering what was popular among the third-party developer community.

Naturally, this practice also raises questions about whether Apple is leveraging proprietary data to make its decisions about what to build next, and whether the apps it competes with are getting a level playing field. For example, before Apple launched its own parental control system, it shut down several third-party apps that had built businesses in this space by saying that their solutions were now out of compliance with their rules and policies. Apps have not been granted access to an API for developers to manage Apple’s built-in parental controls for years, prompting an antitrust investigation.

In recent years, Apple has innovated third-party by launching features like Continuity Camera, medication tracking, sleep tracking, and mood tracking, as well as apps like Freeform and Journal. This year, it turned its attention to password managers, call recording and voice switching apps, those dedicated to creating custom emojis, AI-powered writing tools and mathematical assistants, track apps and more.

In an analysis of third-party apps that generated more than 1,000 downloads per year, Appfigures discovered several types that find themselves in Apple’s crosshairs in 2024.

In terms of total revenue worldwide, these categories generated significant income over the past 12 months, with the Trail Apps category generating the most at $307 million annually, led by market leader and Apple’s ‘App of the Year’ AllTrails For 2023. Grammarly helper apps, like Grammarly and others, earned $35.7 million, while math helpers and password managers earned $23.4 million and $20.3 million, respectively. Custom emoji creation apps also made $7 million.

Of these apps, track apps accounted for the vast majority of “potentially sherlocked” revenue, or 78%, Appfigures noted, as well as 40% of sherlocked app downloads. In May 2024, it accounted for an estimated $28.8 million in total consumer spending and 2.5 million downloads, to give you an idea of ​​the scale.

Many of these app categories have been growing rapidly, with math problem solvers seeing revenue growth of 43% year over year, followed by grammar helpers (+40%), password managers (+38%), and track apps (+28%) ). However, emoji making apps saw a -17% decline year over year.

By downloads, grammar helpers saw 9.4 million installs over the past 12 months, followed by emoji creators (10.6 million), math solving apps (9.5 million), and password managers (457K installs).

While these apps certainly have dedicated user bases that may not immediately choose to switch to a first-party offering, Apple’s ability to offer similar functionality built-in could be detrimental to their potential growth. Average users may be satisfied with Apple’s “good enough” solutions and will not look for alternatives.

However, apps that continue to develop new features and add improvements beyond what Apple includes while also taking advantage of other new ways to reach users, like Apple’s improved Siri, may have a better chance than others.