Windows Phone App Store Grows, iOS, Android Gain Continue to Lead

NEW YORK (TheStreet) -- Microsoft’s (MSFT) Windows Phone App store has surpassed the 300,000 titles mark, but, the Redmond, Washington-based company is not alone in seeing growing success when it comes to selling mobile apps. Apple’s (AAPL) iOS and Google’s (GOOG) Android store are booming as well.


Although relatively small in overall size when compared to the competition, Microsoft's online store growth has been rapid. Just two years ago, the Windows Phone store had 100,000 apps, growing to 150,000 by the end of 2012. It took another year to get to 200,000 apps, but by June of this year, Microsoft said that number jumped to 300,000, with the number of developers working on Windows Phone apps increasing by 50%.

Microsoft stock was gaining 0.42% to $43.38 in midday trading in New York.

Gartner analyst Brian Blau said that although having 300,000 apps is admirable it's still small, overall, compared to the iOS and Android offerings. In a phone interview, Blau said that aside from a handful of very popular titles most apps don't make their developers rich or famous from Apple or Google sales making it even tougher for Microsoft to attract talent. "Why would developers go to Windows Phone?"

Andy Smith, President of Toronto-based independent game app publisher XMG Studios agreed. He thinks Microsoft still has a long way to go to attract developers. “I want Windows Phone to succeed," Smith said in a phone interview. "It means I can sell more apps. But, Microsoft needs to be focused on providing more exclusives than the competition. The current problem is you can’t get people onto the platform because there are so few people on the platform.”

Last week, Apple thanked the iOS developer community for a record setting July in terms of App Store revenue. Apple says the store is doing so well that, to date, it has now paid out more than $20 billion to developers around the world. Developers get slightly less than one-third of the price charged for each app. To date, there have been more than 75 billion apps downloaded from the App Store.

In June, Apple confirmed it had amassed more than 1.2 million apps in its store, but Android’s Google Play store isn’t far behind. According to the latest statements from Google, the Play store offered more than 1 million titles, and was responsible for more than 50 billion downloads and a 240+% year-over-year increase in per-user revenue.

According to research firm App Annie, games accounted for nearly 90% of the Google store app revenue in Q1/2014 although they account for only 40% of total app downloads. Google’s store also has to compete with other Android app stores such as the ones runs by Amazon (AMZN) and Samsung as well as competition from various worldwide and regional offerings.

While Microsoft’s Windows Phone store is currently showing great growth there are still popular app titles that have yet to offer versions designed for that operating system. While there are new apps available from Instagram and Vine there are still some glaring omissions. Microsoft still has to offer its own versions of popular titles such as YouTube and Snapchat due to a lack of support for the Windows Phone platform.

Richard Williams, analyst with Summit Research says “sheer numbers are meaningless” when it comes to measuring the ultimate success of a particular app store. In a phone interview Williams said, “it’s more important that a store has the apps users want and are willing to pay for. That’s the challenge for Microsoft.”

Microsoft is hoping that its plan to merge its Windows Phone OS app store with its Windows 8 PC OS store will help to increase its numbers even more. The idea is to move toward one brand of Windows apps for all platforms - PC’s, tablets and smartphones - with the ultimate goal of offering developers a unified platform for writing code.  That move will also allow Microsoft to combine both online stores into one central gathering place.

Gary Krakow is TheStreet's Senior Technology Correspondent.

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