Steve Jobs was never much interest in making money through software. Apple was always a hardware business and one of the few in their industry able to build a decent margin into the business.
You may not remember, but when the first iPhone came out there was no app store. The original vision was for companies to make mobile versions of their websites and products and you would launch them in the phone’s browser.
But fans wanted to access the hardware and install software on the phone, so Apple made it happen and took a cut. No one, not even Apple, realized that an entire new world would emerge with apps.
Apple didn’t invent the app, but they didn’t invent the MP3 player, touchscreen, or tablet either. Since Apple’s app store came online every smartphone and tablet operating system has embraced the model. Desktop operating systems and even online platforms like Facebook now have apps too. And they’ve made a lot of people rich.
Another thing they’ve done is create jobs, lots of them. Since the financial crisis thousands of developers have flocked to a new industry created around the building of apps. Everything from Farmville, to weather, to turn-by-turn GPS, and to taking photos has turned into an app. There are even apps of apps, meta-apps if you will. The the Facebook app on the iPhone one can launch the Scrabble app and play the same Scrabble match you were playing in the Scrabble app within Facebook through a browser. It’s almost impossible to follow.
A new report says the “App Economy” has created 500,000 jobs and last year raked in $20 billion in revenue. A very impressive number that’s likely kept a lot of IT workers out of the unemployment line. It’s an industry that doesn’t get any attention in Washington, and no tax policy or stimulus was going to help it or get in its way. This economy grew out of innovation.
It’s a perfect example of supply and demand. But it can’t be replicated in other parts of the economy. New industries pop up all the time and they’re very difficult to predict. Everyone knew that someday the future would be in mobile devices, but not many were focused on the software operating those devices. The only thing the US can do is continue to encourage innovation and no neither the right nor left really even understands what that means.
Whether that 500k jobs number is accurate or not is almost irrelevant. Apps have helped make a few billionaires, a lot of millionaires, and created tons of jobs and new companies in the last few years. That’s pretty impressive considering the late Steve Jobs was opposed to apps at first.
Via Mike Mandel via Alphaville
Image: Cristiano Betta
 By The Weakonomist |
The Weakonomist is the founder of Weakonomics. Clicking the picture of the puppy will tell you more about him. If you like what you're reading consider subscribing to the blog, following him on Twitter, and checking out the related posts below. Please consider a donation if you really enjoy Weakonomics. Also keep in mind that nothing I say can be construed as financial advice. |
