Everybody heard about riches of iOS game developers, but what if you are not Rovio and not even the author of Cover Orange? Can a company be successful in the AppStore without a blasting hit? Let’s take a look at Alawar, one of the most successful gaming companies in Russia. While Alawar publish games for almost every platform, including consoles, I will analyze only its iOS business, which started roughly 2 years ago.
For this, I will use the publicly available data, make some assumptions and educated guesses.
- the price of a game has been unchanged for its lifetime;
- the free versions of the games don’t bring in any revenue;
- the paid games only bring sales revenue (i.e. no ads or in-app purchases);
- the total sales of a game are two times of the game’s sales in USA. This is important, because it’s relatively easy to estimate USA sales, but not for the rest of the worlds. However, this 2x factor usually works very well.
With these in mind, I ended up with the following guesstimate for the iPhone sales:
and iPad sales:
As it turns out, Alawar does have a solid hit: The Treasures of Montezuma. However, many games don’t reach a 5-digit level of sales. So the question is the cost of making these games. In this particular case, Alawar produces these games on the cheap, because they port their existing Flash titles to iOS. The cost of porting a single game is $5-10K. Even if we assume the cost at $10K and count the cost for iPhone and iPad versions separately, this line of business is wildly profitable.
However, if a small studio produced games like these without any prior work, it would hardy have cost more than $20K per game. Even in this case it would be a profitable business. No wonder more and more startups are being founded and funded every day to develop games for iOS.
Disclaimer: I have no any relation to Alawar and haven’t received any inside information from anyone in the company. If you want to provide more accurate details, you are welcome to do so. I will update this post accordingly.