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The average iPhone user spends a ton of money on apps, and it keeps going up

Mimi Sabreena 4:02:00 AM Business Insider

Apple iPhone owners aren’t afraid to spend money on software and apps.

The average iPhone owner in the U.S. spent $40 on apps from Apple’s App Store last year, according to new analysis from Sensor Tower, an app analytics company.

This figure is up from 2015, in which iPhone owners spent $35 on average on apps, according to Sensor Tower.

Most of that money is games, according to the analysis. “More than 80 percent of U.S. App Store revenue in 2016 was generated by games,” Sensor Tower analyst Randy Nelson wrote in a blog post. “U.S. iPhone owners spent an average of $27 per device on games last year, up from $25 in 2015.”

But the biggest growth category was Entertainment, which includes content subscription delivery apps like HBO Now, Hulu, and Netflix. Apple last year changed the way it takes its 30% cut from App Store sales for subscription apps, cutting it to 15% after the first year.

Sensor Tower

Although iPhone users are spending more on iOS apps, they are tending to download fewer apps, according to Sensor Tower’s analysis, which found that the average number of apps downloaded declined to 33 last year from 35 in 2015.

Last year, Citigroup analysts estimated that the average iOS device generated $52 in annual total sales, which is significantly higher than Sensor Tower’s estimate. Citigroup also estimated that the average Android phone only generated $5.70 in annual sales from Google’s Google Play app store.

Apple has recently emphasized its “services” business — which is mostly the rent it takes from operating the App Store on its devices, but also iCloud and Apple Music — to investors as a way Apple is keeping its overall margins and sales high as iPhone growth slows.

Check out Sensor Tower’s complete report here.

Sensor Tower

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