Facebook said it paid out $1.4 billion to developers through payments on its platform in 2011. Apple paid out half that much to iPhone, iPod and iPad developers last quarter.
Apple said it paid $700 million to iOS developers in the holiday quarter during its earnings call last week. While we can’t be exactly sure of how much it paid in all of 2011, the company did say last week that it had paid out $4 billion over the lifetime of the app store, up from the $2 billion cumulative figure it shared less than a year earlier during March’s iPad 2 launch. While the dates of these milestones are probably slightly off, it suggests that Apple paid more than $2 billion to developers last year.
The other thing to consider is that Facebook only made Credits mandatory for canvas games in July, so Facebook’s numbers for the first half of the year don’t reflect the full earnings power of the platform. Since Facebook earned $188 million in payments revenue last quarter, that implies that it paid around $438 million out to developers in the holiday quarter based on its 30 percent revenue share. That’s about 62 percent of what Apple paid developers in the fourth quarter.
What this all means is that Apple’s iOS platform outperforms Facebook on a per-user basis for developers. Consider that Facebook has 845 million monthly active users while Apple has sold 315 million iOS devices (which doesn’t account for users who have more than one iOS device or who upgraded to newer iPhone or iPads). Since the “barrier to entry” to iOS is buying an actual device while joining Facebook is free, we’d naturally expect Apple’s platform to attract a more lucrative demographic.
We know that we’re comparing apples to oranges here (literally). But for developers deciding which platforms to build upon, these trade-offs are very real. Developing an app for Facebook might mean spending fewer resources on smartphone apps. So comparing potential payouts helps developers understand where to wisely invest their time and talent.