4% of apps are generating 72% of all iPhone App Store revenue says Distimo

While the headline figure from Distimo's presentation deck from the Verizon Developers Conference was that 72 percent of revenue for iPhone apps comes from in-app purchases, that's not the whole story.

More striking is only 4 percent of iPhone apps include IAP.

The figure seemed so low, we had to check with Distimo that it was correct.

It is.

Freemium cash-in

The reasons are partly due to legacy issues, as IAP was enabled in June 2009, almost a year after the App Store launched.

The other is that although IAP works well for certain categories - notably games - the upfront paid model (or purely free) remains the most popular business model. Obviously, although games are the single largest App Store category, overall it's a minority.

Still, IAP is more popular for certain types of content.

According to Distimo's analysis, as expected, the proportion of free games that include IAP is significantly higher at 11 percent.

It's a similar situation with iPad apps; 7 percent of dedicated iPad content includes IAP, rising to 20 percent for free games

But, the conclusion remains that a mere 4 percent of iPhone content on the App Store is generating 72 percent of the revenue.

And that's why you should be including IAP in your games.