Are iPad applications the promised land for developers?

Jason AnkenyDespite sales closing in on the 4 million mark, Apple's (NASDAQ:AAPL) iPad still pales in comparison to the company's iPhone--Apple shipped 8.4 million iPhones during the second quarter alone, selling more than 3 million iPhone 4 units in the smartphone's first month at retail. But mounting evidence suggests iPad applications could prove even more lucrative for developers than iPhone efforts. New data issued by mobile advertising exchange Mobclix indicates that iPad apps earn developers substantially greater advertising revenues than corresponding iPhone apps--not only does iPad software boast an eCPM (effective cost per thousand impressions) rate five times higher than on the iPhone, but the tablet's rich media capabilities also boost consumer interaction, with click-through rates on video ads 11 times higher than on the iPhone. In addition, gaming sessions on the iPad typically run three times longer than the same title on the iPhone--about ten extra minutes, Mobclix notes.

The iPad's immersive user environment no doubt explains the results of another new report, this one from mobile analytics firm Distimo, which states that the number of applications enabling in-app purchases is five times higher in the App Store for iPad than in its iPhone counterpart: 10 percent versus 2 percent, respectively. Twenty five percent of social networking applications for the iPad include in-app purchase options, compared to just 4 percent of similar apps for the iPhone; the disparity extends across virtually all app categories, including games (17 percent of iPad apps compared to 4 percent of iPhone titles), finance (16 percent to 1 percent) and navigation solutions (16 percent to 3 percent). There's a caveat, however: "The higher percentage of applications with in-app purchases in the Apple App Store for iPad may be caused by the fact that this store became available after in-app purchases were introduced, while in-app purchases were not available when the Apple App Store for iPhone was introduced," Distimo notes. "More importantly, another reason to consider is that the iPad may currently be used more as a media consumption device than the iPhone with magazines such as Sports Illustrated and Wired selling their content as in-app purchases."

Even though the iPad is shaping up as a more profitable and flexible platform for developers, Mobclix reports that as of late June, fewer than 16,000 applications in the App Store are exclusive to the tablet--the vast majority of iPhone apps are compatible with the iPad as well, of course. Among iPad-specific apps, about 20 percent are games, more than any other category. But only one game, OOO Gameprom's Pinball HD, places in Distimo's Top 10 iPad application bestseller countdown for June, which runs the gamut from news apps (Alphonso Labs' Pulse News Reader) to business solutions (Quickoffice's Connect Mobile Suite) to photography tools (Pocket Pixels' Color Splash). Five out of the top ten premium iPad apps fall into the productivity category, and three of them--Pages, Numbers and Keynote--are apps published by Apple itself, all priced at $9.99 each. Which just goes to show that the iPad is a potential gold mine for all involved, most of all for the guys who built the platform in the first place. -Jason