Do the Math on Your Mobile Apps

Andrew Savikas
October 1, 2009 | Permalink | Listen

One of my favorite sources of interesting reading material these days is Hacker News (follow them at @newsycombinator), and this week they pointed me to a piece from Derek Sivers that applies to many of the emerging digital and mobile markets for media:

He kept saying, "If only one percent of the people reading this magazine buy my CD... that'll be 10,000 copies! And that's only one percent!"

...

Over the next few weeks he received four orders. Total CDs sold: 4

....

I think of this every time I hear business plans that say, "With over 30 million iPhones sold, our app is sure to..."

On the one hand, putting a one-click bookstore in 30 million pockets means someone is bound to buy your app. On the other hand, if it costs you $25K to develop the app (a typical and realistic investment for a greenfield app), you're probably not going to have enough income to build any more apps for awhile.