iOS 18 Might ‘Outsmart’ $400M in App Earnings

A recent analysis highlights the substantial economic implications for third-party developers arising from Apple’s practice of incorporating their ideas into new features and apps for iOS and Mac. As the public beta for iOS 18 becomes available ahead of its autumn launch, it’s evident that Apple’s updates could affect applications that, over the last twelve months, have collectively generated approximately $393 million in revenue and experienced around 58 million downloads. This insight comes from Appfigures, an app intelligence agency.

The term “sherlocking” synonymous with Apple’s method of unveiling software features at its Worldwide Developers Conference each June, harks back to a search tool from the 1990s, named after the Mac app Sherlock that appropriated functions from a third-party app called Watson. Nowadays, whenever Apple integrates a function that mirrors those found in third-party apps, it’s deemed to have “sherlocked” the application.

Historically, there was logical reasoning behind “sherlocking” certain apps. For instance, integrating a flashlight directly into iPhone’s system functions rather than it being an external app offering. Additionally, by examining the trends within the third-party developer realm, Apple has effectively introduced improvements aligning closely with consumer demands.

However, this approach triggers concerns about whether Apple uses proprietary insights to decide on its next inventions and if it ensures a level playing field for its competitors. Before introducing its in-house parental controls, Apple sidelined numerous third-party parental control apps, citing non-compliance with its guidelines, which led to a competition investigation as these apps were denied access to necessary APIs for managing Apple’s native parental controls for an extended period.

In its recent innovation spree, Apple has incorporated features and apps that parallel third-party offerings, including the Continuity Camera, health and wellness tracking functions, as well as productivity and outdoor activity apps in recent years, encroaching into the territories of password managers, call transcription services, custom emoji creators, AI writing assists, math tools, and trail-finding applications.

Appfigures pointed out that, among the third-party app categories generating over 1,000 downloads annually, several find themselves directly in Apple’s competitive scope for 2024.

These app genres have collectively amassed significant revenue in the past year, with trail-finding apps leading the pack at $307 million, exemplified by the market leader and Apple’s 2023 “App of the Year”, AllTrails. Grammar aides and math tools also saw considerable earnings, alongside password managers and custom emoji apps.

Trail apps specifically represented a substantial 78% of the revenue potentially affected by “sherlocking”, accounting for 40% of the downloads in the scrutinized apps category, with an illustrative $28.8 million in sales and 2.5 million downloads in May 2024 alone, as estimated by Appfigures.

Despite varying growth rates among these app categories, with math solvers and grammar aides experiencing significant year-over-year revenue spikes, emoji-making apps faced a decline, underscording the diverse impact of Apple’s integration strategies.

While devoted users may remain loyal to their preferred third-party apps, Apple’s integrated solutions presenting “good enough” alternatives could stifle these apps’ growth potential among casual users.

Nevertheless, third-party apps that continually innovate, improving their offerings beyond Apple’s standard features, especially those exploiting Apple’s enhanced Siri capabilities, may still find success in this competitive landscape.

This narrative was initially shared on June 18 and has been updated with details on the iOS 18 public beta.