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Apple: iTunes Store, iCloud services continue to rise

updated 08:14 pm EDT, Tue July 23, 2013

Cloud services an increasingly important factor in sales

While some segments of Apple's hardware line did less well -- or in at least one case considerably better -- than expected, the company's quieter but steady growth in cloud-based services ranging from iTunes Stores to iCloud-based services continues to become increasingly important in retaining and attracting buyers. Apple now has over 320 million iCloud accounts, up from 250 million six months ago, and push notifications have doubled during the same period to over eight trillion. Users of iOS also pushed the App Store to new highs in downloads and revenues.

Wireless features such as AirPlay, iMessages, Find My iPhone and iCloud syncing are already significant selling points that Apple implements better than competitors, and growth in the area of online app and media stores, iCloud and Messages reflects customer desire for more. Like the push notifications, the company's disruptive iMessage service has doubled in the last six months, from 450 billion messages in January to over 900 billion in June.

Game Center has grown as well, from 200 million accounts at the start of the year to 240 million now, and users have posted 125 billion photos through Photo Stream. There are over 900,000 apps for iOS by Apple's count, with 375,000 of them being designed for the iPad -- a key metric that has differentiated Apple's tablet from competitors. Also in January of this year, Apple saw the iOS App Store reach the 40 billion mark -- and hit the next milestone, 50 billion, a few weeks shy of the store's fifth anniversary. At its current pace, the store will hit the 60 billion apps downloaded total before Christmas this year, possibly well before then.

The popularity of the store has also resulted in some $11 billion paid out to developers, Apple revealed today as part of its conference call with analysts. The iTunes stores overall took in $4 billion in revenue for the fiscal third quarter alone, with $2.4 billion of that coming from the App Stores.

To put that in perspective, the iTunes stores are doing almost the same level of business as Apple's retail stores, which reported $4.4 billion in revenue (on flat growth). The company also noted that 800,000 TV episodes and 350,000 movies are being bought or rented each day, making it the second most successful such streaming media business behind Netflix.

Even as the slump in PC hardware wreaks havoc on the industry (and affects Apple as well as Windows-based vendors), the company's investment in a complete eco-system of services, software and media has given Apple the means to outperform other hardware vendors as well as increase the loyalty to its platform -- a factor that is only likely to increase as Apple releases at least one new iPhone and iPad model later this year, along with a major upgrade to its iOS platform. The company already reported that the iOS platform sees a 93 percent loyalty rate among buyers.

Even the Mac's share of the market is up by comparison with the rest of the PC industry, despite a downturn in units compared to the year-ago quarter. While smaller in effect than its iOS sibling, the Mac App Store and the general quality of Mac apps being offered by developers -- to say nothing of the platform's deep and ongoing integration with iOS -- is adding to the Mac's allure and "stickiness" in the same way.



By Electronista Staff
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