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Apple’s ProApps- not a money loosing scenario
Another interesting article by Alex Gollner, looking at how ProApps doesn’t JUST make money off hardware sales–
https://alex4d.com/notes/item/pro-apps-2005-2014
If course, these numbers pale in comparison to larger profit centres like iPads and iPhones, or even Macs- but at nearly 2 BILLION DOLLARS a year in revenue (up from approximately $250 million in 2005), it certainly seems less likely that Apple would walk away from this business as many have suggested.
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55 Replies
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That’s pretty impressive for sure – before Avid was de-listed they were showing total annual revenue of a little over $600million and that includes everything they make from audio hardware etc. So FCPX at $299 and Logic at $199 have a way larger user base than ANY other NLE including Adobe!
It was at a Vegas premiere that I resolved to become an avid FCPX user.
Lance Bachelder
Writer, Editor, Director
Downtown Long Beach, California
https://www.imdb.com/name/nm1680680/?ref_=fn_al_nm_1 -
Let’s not forget MOTION $49, COMPRESSOR $49, and the (still for sale) APERTURE $79. Aperture was a big seller if you look at the “Top Grossing” or “Top Paid” listings. Motion and Compressor, due to volume and price, probably make up significantly smaller proportion of the total revenue.
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So I was a little ahead of schedule, but this is very nearly EXACTLY what I predicted. I observed that Apple had made at least $2 billion from the software sales of FCS Legend, and that was assuming only one software upgrade for only one third of units sold. The number was surely higher.
That was over the course of 12 years. I predicted that they would soon be making more than that every single year.
Again noting that my timing was wrong, I have maintained from the beginning that Apple’s interest in Pro Apps had NOTHING to do with selling high-end Macs, and everything to do with their interest in being in this market.
But I’m right so rarely that I thought it was worth mentioning. LOL
Keep in mind that Apple pushed FireWire as a solution for laptop editing, and long positioned FCP as a self-contained system that could do everything it needed to on a minimal hardware platform. It was in contrast to everyone else that needed heavy iron.
This too goes back to Steve’s vision of a consumer-oriented video application to run on the colorful new bubble-shaped iMacs. It was only after Adobe declined to sell Premiere to Apple (!!!) that they went looking for an alternative. They happened to find it being developed by the former developer of Premiere, now at Macromedia, and running on Windows. The fact that it could easily scale up to something truly professional was a happy accident.
It’s part of why I’ve also never bought the idea that Final Cut X was EVER intended for consumers, AT ALL. iMovie a nifty product that does that just fine. The distinctions are meaningful, even if, in the long run, the two have informed each other along the way.
It’s ultimately a confirmation that Steve was right, that a low-cost video creation platform could be a money-maker for Apple, WITHOUT heavy iron, which was never the point. Computer sales, yes. Top of the line computer sales, absolutely not. Monitor sales, absolutely not. It’s no accident that…wait for it…the IMAC is such a sweet spot. That was the plan from the beginning.
BTW, this is an overly brief summary of an extremely well-documented set of stories from volume 2 of John Buck’s Timeline: A History of Editing, a marvelous overview from 1925 to roughly 2011, just before the release of X. (Now THERE’s the start of a third volume for ya.) You’ll enjoy the heck out of it.
And as a reminder, although my timing was off, I was in fact right three years ago: that Apple would be making more from an APP version of the ProApps in a year than they’d made in the entire history of FC Legend.
I’ll let you know the next time I’m right, but it may be a while.
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Original thread:
https://forums.creativecow.net/readpost/335/65839
Conclusion:
[Franz Bieberkopf] “…the total for “iTunes, Software, and Services” comes from Apple – and the rest is just his guesses at how that breaks down.”
The numbers that he’s dreamed up are way off.
FCPX is selling about 300,000 per year – that’s 90million per year on FCPX sales. It’s more or less consistently their “highest grossing” software, which means that Logic and Aperture gross less than that per year.
The math from there gets nowhere near 2 Billion.
Franz.
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This is a more recent report- and not the same info, though how Dediu breaks apart the iTunes number is presumably the same as from February. So your trepidation about the numbers might still stand.
Let’s not forget to incorporate growth into your yearly calcuation- if we only take the growth on the chart as true, then ProApps sales have basically doubled from the launch of X in 2011 to the first 3 months of 2014. On this chart from 250 mil in 2011 to just shy of 500 mil in the highest selling quarter this year.
While your avg of 300,000 per year is probably in the ballpark (if you assume Apple’s “over 1 million” from April to be something like 1.2-1.4 after this quarter), then we’d have to think they sold WAY more in the last year than they did in the first year. So FCP X unit sales for 2014 might be closer to 600,000, depending on what the sales curve looks like. Which would make 2014 FCP X revenue closer to $180 million.
I agree there’s still a disparity between that and 2 billion/yr.
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[Marcus Moore] “… we’d have to think they sold WAY more in the last year than they did in the first year. So FCP X unit sales for 2014 might be closer to 600,000, depending on what the sales curve looks like.”
Marcus,
I suppose there are lots who might believe the same.
Franz.
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Until we get another number from Apple- when they cross 2 million maybe, we’ll have a better idea of the sales curve. Until then its unclear.
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[Marcus Moore] “Until then its unclear.”
But heaven forbid that should stop people from tossing numbers around.
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It’s called a discussion forum for some reason… Hmmmm.
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[Marcus Moore] “It’s called a discussion forum for some reason… Hmmmm.”
That gets a “like”
Steve Connor
Mellowing slowly
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