How much Americans pay for top apps and their potential for big bucks

Although Americans love social media, how much would they be willing to pay for their favorite apps?
Written by Eileen Brown, Contributor

I wonder whether we would be so keen to post if our favorite apps such as Twitter or Facebook carried a monthly subscription fee? Currently, apps depend on advertising or seed investment to ensure that their services remain free.

Obviously, brands that depend on these social apps for business would continue to pay, but would the average American user still be so keen to sign up to the service if things changed to a pay-to-play model?

In-app purchase revenue is already a huge market in terms of revenue. According to Apptica analytics, paid apps, split by application category across the US, show that the entertainment and game categories lead the paid apps list on iOS, with games and applications dominating the Android platform.

Study reveals how much Americans would pay for top apps–and their potential revenue zdnet
(Image: Apptica Analytics)

Chicago-based marketing and advertising firm Mcguffin Creative Group recently studied the value that 2,000 users would place on 16 of the most widely used apps.

Its paid apps survey, carried out in June 2019, asked respondents what they would pay if they had to pay a monthly subscription, or if they'd pay nothing and discontinue use.

Study reveals how much Americans would pay for top apps–and their potential revenuezdnet
(Image: Mcguffin Creative Group)

Most of us (three-in-four people) would pay monthly fees, on average, across the top 16 apps. And the cost is not too high. The most valued app -- YouTube -- would cost users less than $50 per year for its service. Not every user was prepared to pay for an app, however.

The survey showed that users would pay the most for WhatsApp. Almost nine out of 10 (89%) of users indicated that they would pay $2.38 per month to use the service. Over seven out of 10 (72%) YouTube users said that they would pay $4.20 per month to use YouTube.

Facebook trailed in the rankings table as the app fewest people are willing to pay for. Less than two out of three (64%) said that they would pay to use Facebook and would pay $2.92 per month to do so.

The five apps that users are least willing to pay money for are Facebook, Facebook Messenger, Venmo, Instagram, and Twitter.

More interesting is the amount of projected revenue that the apps would earn if the app had a paid model in place. By far, the most successful app would be Reddit. In the chart above, users said that they would pay $2.74 per month for the app.

In 2018, Reddit's ad revenue was $76.9 million. If all of its users paid for the service, then Reddit's projected revenue would be $8.3 billion -- a massive projected increase of 10,771%.

The second-most popular app in terms of potential revenue was YouTube, which, in 2018, generated $3.4 billion in ad revenue. If users paid $4.20 per month, then its projected revenue would increase to $68.9 billion -- a 1,929% increase. 

On the other hand, Facebook's current ad revenue is $46 billion. If its users paid $2.92 per month for its service, projected revenue would increase to $53.4 billion -- a projected increase of just 16%. Obviously, its users do not value Facebook as much as other platforms.

Some users would inevitably balk at paying for an app, but if the pay-to-play model became accepted, then this type of revenue generation could become the norm. 

And if that happened, some social sites could do very well indeed.

Previous and related coverage:

Quickly learn a new language with AI-powered Lingvist

I become addicted to learning a new language with the Lingvist language software within a day of using it.

Millennials are twice as likely to use unapproved collaboration apps in the workplace

As collaboration tools like Slack and Teams become more popular, collaboration across the enterprise will inevitably evolve, and companies need to be strategic about deployment.

Apps are a must: Three out of five start shopping via mobile

Do you spend money on improving your shopping app, using paid search, or simplifying your website? A new study shows you where to invest.

One-third of gamers feel businesses don't care about them

Although gamers watch more videos than all other audiences, brands try to sell them useless products and services.

Editorial standards