Developers $21 million richer after iPhone App Store's first month

It's now been a month since Apple opened the virtual doors of its App Store, and it looks like the place to be. Speaking to The Wall Street Journal, Apple CEO Steve Jobs revealed that consumers have already downloaded more than 60 million iPhone applications--while a majority of the applications were free, Jobs said that the App Store still sold an average of $1 million a day in premium downloads, generating about $30 million in sales so far. Assuming sales continue at their current pace, by mid-2009 Apple and its developer partners are poised to earn at least $360 million in new revenue from the digital storefront. "This thing's going to crest at half a billion, soon," Jobs told The Journal. "Who knows, maybe it will be a $1 billion marketplace at some point in time. I've never seen anything like this in my career for software." But Jobs said that in the same way Apple makes little by selling music and video content on its iTunes platform, the App Store isn't much of a cash cow once the company subtracts operating expenses from its 30 percent share of profits--instead, Apple will rely on the App Store to add luster to the iPhone and iPod touch. On the other hand, Jobs said iPhone application developers earned about $21 million during the first month, with the top 10 developers raking in roughly $9 million.

Still, the App Store continues to face its fair share of controversy. Digital privacy and security advocates are up in arms over an independent engineer's discovery that each iPhone contains code that could theoretically remove software from the device at Apple's discretion--Jobs confirmed the so-called "kill switch" mechanism during his interview with The Wall Street Journal, arguing it's necessary in case a malicious program is mistakenly added to the App Store. "Hopefully we never have to pull that lever, but we would be irresponsible not to have a lever like that to pull," he said. Fair enough, but what safeguards are in place to guarantee the security of the kill switch itself? Moreover, what criteria does Apple use to judge malicious applications? In the last week alone, two high-profile apps disappeared from the App Store: One, I Am Rich--an application that does nothing but display a glowing red jewel for a sum of $999.99--may defy all logic and good taste, but developer Armin Heinrich says he adhered to Apple's approval process. The other app to go MIA, NetShare, enables iPhone 3G users to link the device with their Mac--conventional wisdom suggests it's gone because operator partner AT&T does not allow for tethering software in its contract with Apple, but nothing has been confirmed. Which of course means other applications may run afoul of the same unwritten rules. Now that the App Store has redefined mobile software distribution, it's time for Apple to redefine the policies and restrictions that govern the site. -Jason

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