Apple’s Enormous yet Seemingly Hidden Revenue Stream

Let me tell you as plainly as I can without making a big deal of it — it’s the App Store. Apple has reported $10 billion in sales for the year 2013. And we thought it was all about selling iPhones and iPads. The anticipation and interest companies and people have shown in wearables (Pebble, Oculus Rift, and Google Glass, etc.) produced enough dust to hide the capacity and potential of the smartphone e-commerce (apps & accessories).

Tim Cook acknowledged and seized the moment politely during a F1Q 2014 discussion:

“In general, we’re seeing that people love being able to buy content, whether it’s music or movies or books, from their iPhone, using Touch ID. It’s incredibly simple and easy and elegant, and it’s clear that there’s a lot of opportunity there.”

Imagine if this quote was about any new gadget (let’s say iWatch), people would be jumping off their seats due to excitement, yet it went unnoticed.

E-Commerce via iTunes, iBooks and the App Store

It may seem dull, but it is a very lucrative retail industry. Apple is earning billions through iBooks, iTunes, and the App Store. Apple is way ahead of Google and Microsoft in this regard, while keeping the fact in mind that most people these days own Android phones.

Touch ID is not what you think it is

At first you may see Touch ID as another gimmick by Apple for iOS. However, if you look closely at its functions, you will be surprised. I would recommend you to connect the dots by reading our post about iBeacon, then analyze Touch ID in terms of future shopping trends. Touch ID may not only prevent theft and misuse of your iPhone, utilizing it for business & identification will turn your iPhone into a perfect mobile payment device.

A national shopping infrastructure

If we keep the staggering figures of the App Store sales and Tim Cook’s statement in mind, then we can clearly see how Apple is trying to build a national shopping infrastructure. Combine iBeacon, Touch ID and stores equipped with Bluetooth transmitters and we get the modern day shopping infrastructure. You will receive notifications about products with exact shelf location while you roam the store. You can make payments through your phone while identifying yourself through Touch ID. You can essentially complete the whole shopping process without taking out your wallet.

However, there is a small catch to it. People may begin to get annoyed at the push notifications. Perhaps you may need an app like Passbook to allow certain stores to send offers to your iPhone.

Wrap Up

The App Store is an enormous yet hidden and not so talked about revenue stream for Apple. Apple has realized the potential of the retail industry and the intersection that exists with mobile technology. The future also looks very bright for Apple if it all goes well with technologies like iBeacon and Touch ID. Personally, like many others, I have always enjoyed the easy and seamless shopping experience at the App Store and I would love to see it grow into other aspects of my life.