This post from flurry [1] suggests that a big chunk of revenue is going to a small proportion of very successful developers (there was a HN post about which companies they were but I can't find it now).

That said it also suggests that revenue is increasingly moving down the long tail which may be a sign small app companies may become more viable.

[1] http://blog.flurry.com/bid/88014/The-Great-Distribution-of-W...

> My question is what does it take to build a real business in the app store?

Conventional wisdom is that the money is in development work and not selling apps by yourself on the store.

If that's true, what's the longterm viability of the market as a whole? Intuitively for dev services to succeed here it must be true that [shrink-wrap app model profitability] >> [service model profitability].

That only works if you think of apps as traditional software with the App Store as a traditional store. Apps are closer to websites: a few are very profitable on their own, most are just a neccessary part of a larger business.

It's basically the top .1% of apps on iOS - the top 1000 overall or so - that make around $1000/day.

There are close to 1,000,000 apps - 9,999,000 support one person or less.

$1000/day isn't a company. It's a one or two man shop. It doesn't sound like the economics are there to build the next EA, id Software, etc.

You are thinking from your New York or Silicon Valley bubble? Don't worry, I live there too.

Actually, if you are bringing in $1000/day in the Ukraine, you might have quite a little startup indeed.

$30k/month pre-tax?

Forget the bubble -- what makes a company a "real" company is offering things like health insurance and PTO, which are not cheap. That's one or two folks max.

There are no taxes if you spend it all.

And as a person who runs what you think of as a "real" company, I still don't like the sentiment that people who are trying aren't real companies.

> There are no taxes if you spend it all.

Tell that to EDD & the FTB ;)

A 1 or 2 person company can be a "real" company. I would love to co-found a 2 person company that did $30k/month, and I'd be proud of it.

But let's not pretend that trying is enough. Being a "real" company is hard. It takes a lot of planning and effort to be square with EDD/FTB/IRS/insurance, cut paychecks on time, pay your partners/vendors, keep PTO records & pay set aside the right way, and so forth. Doing those things is something to be proud of, and something a lot of startups that call themselves companies and give eachother CxO titles don't do.

I think companies who actually take the time, effort, and expense to run those things right -- and have the scale that makes doing those things make sense -- deserve to be called real companies. Just one man's opinion.

Based on how it was said, I assumed corporate taxes. So sure, you need to pay your 800 bucks to the state of California (if you even operate here), and a couple points for payroll tax.

But it's just the sentiment I don't like. If young entrepreneurs give themselves trumped up titles and dream of grandiose things, that doesn't disgust me at all. Perhaps a wry smile, along with some encouragement.