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The most interesting (and possibly neglected) piece of information that I've found when analyzing the economics & business of the App Store is just how many apps are a slightly different take on an app that was popular a few years ago.

Each month, millions of people are getting an iOS device and opening the App Store for the first time and are unfamiliar with the apps that were popular 6 months ago, let alone 1-2 years ago. Doodle Jump is popular but it's actually extremely similar to Super PapiJump, an iPhone game that was huge a few years ago. Same exact mechanics, slightly different graphics & execution.

The mentality that you need an original, unique idea to succeed in the App Store is rubbish. A common algorithm for succeeding in the App Store is take Popular App A from 2009 and re-implement it with new graphics and perhaps an additional gameplay mechanic and release it as Hopeful Popular App B in 2011. Apps that were entertaining and popular (but have fallen off the charts due to lack of updates) were based on game mechanics that are probably still alluring to new audiences in 2011.

Agreed. I've more or less stopped buying any new iOS apps. Having had an iPhone for just under three years now, I've basically found a solution for anything I care about using my phone for. However, I've noticed that I regularly hear about a "great new app" from newer iOS users, but it turns out to be some recycled version of an app/game I already have.
'Just realized I'm a hipster iOS user.
I recently bought a game which I (and friends) implemented versions of in high school... in the early 80s. :-)
Which one?
Hard Lines.

(I saw some article about problems with a version; just shows that all advertisement is good...)

> "The mentality that you need an original, unique idea to succeed ...is rubbish."

I don't know whether to make an Electronic Arts, Activision or Zynga joke here.Suffice to say: you're absolutely right in a business sense and that's a damn shame.

Why shame? We're not really talking about endless repetition, we're talking about actual improvements, however minute, and changes that make the game playable on new iOS versions/device.

It is great if you can make something new, but if you can't, and have a good idea on how to improve something old, I say go for it. We need that too.

The problem of EA/Activision/Zynga is that they take ideas, make almost no improvements, and then use their marketing power to come on top anyway.

The shame is that the approach works almost independent of whether the improvements are there are not. The success of knock-offs seems to have much more to do with marketing.
" A common algorithm for succeeding in the App Store is take Popular App A from 2009 and re-implement it with new graphics and perhaps an additional gameplay mechanic and release it as Hopeful Popular App B in 2011."

Not disagreeing with you, but isn't this the common algorithm for most things? I can think of TV Shows, movies, books, websites etc. that use the same algorithm.

I think mimicry exists across various mediums, but the starkness of it on the App Store is pretty intriguing. Most times there's not even a new gameplay mechanic, just new artwork and a new name.
There are actually a number of those algorithms, often it is either a combination of two existing things (G+ is like Facebook but with asymetric relationships like Twitter); a twist on something that already exist (Firefly is a western but with an oppressive government set in space); or (but mostly with physical things) something that is not as good as what was previously but ordinary people can afford it (indoor plumbing which is not as good as servants preparing your bath, but much much cheaper or the Ford T).

Sometimes it is a mixture of these.

You might want to look for a more current and better example.

PapiJump was a free game and it came out in summer 2008. Later the developer released PapiJump Plus, a paid version of the game. It never was all that successful in the grand scheme of things, at least compared to Doodle Jump. Doodle Jump is a clone that came out one year later. It cost money from the start and it felt a lot more like a sequel than a straight up clone.

All gamers love sequels. All gamers love variations on a theme. The story of PapiJump and Doodle Jump is not in any way surprising and, I think, also not in any way something that defines the whole iOS ecosystem.

Don't know if I agree with this conclusion that people will pay more for apps now. What if iPad apps are raising the average? iPhone and iPod touch owners may not have paid a cent more than they did the year before for any given app.
I was expecting

“iOS users buy more apps and pay more for them than Android users.”

but instead this is about

“iOS users buy more apps and pay more for them than last year.”

Both are interesting in their own right, but I think it was a little disingenuous to not announce the previous-year comparison right in the title or the first paragraph. They really buried the lede in the article.
So, some quick math: The average user downloads 83 apps. 15 billion apps have been downloaded. There are a bit over 180 million iOS devices. $2.5 Billion has been paid out to developers; that's about $14 per user. Since the average price of an app is $1.48, the average user buys 9.45 apps.