There are lots of articles floating around analyzing the effects and implications of iPhone app piracy. Two of the most relevant questions for app developers (regarding piracy) are:
- How many app users are pirates?  SmellsLikeDonkey says 70% - iCombat says 80%
- Can pirates be converted to sales?  Pinch Media says 0.43% - SmellsLikeDonkey says 0%
Bottom line, developers are interested in how much revenue they are losing due to app piracy. This post is my attempt to throw a slightly distasteful idea into the mix: pirates are helping me make more money.
(Note: Certainly does not scale with size. Any Top 100 App will not receive any benefit from piracy)

All data is from my Punch ‘Em! - Fight people through your camera! ($0.99) iPhone app, with modest sales figures over the period described below. I have removed any monetary information. Sales data from Apple; Piracy data from Flurry Analytics.

I thought I was going to talk about Christmas
This post was going to be about Christmas and how it was responsible for the (relatively) long term increase in my app sales. As an iPhone developer this was my first Christmas, and Punch ‘Em! (my only paid app at the time) was the only one affected at all, so I quickly clung to the idea of residual sales from the Christmas push. But it wasn’t Christmas. It was Pirates. Slightly before Christmas, there was a huge pirating push against Punch ‘Em! [If you’d like to know how I determined that it was piracy and not Christmas, see the last section].

What were the app stats like?
For the sake of simple comparisons, the data consists of the periods Dec 4 - Dec 20 and Dec 30 - Jan 15 (17 days each). Through research and personal analysis (mentioned in the last section), I conservatively decided that the “Christmas effect” only affects the period Dec 21 - Dec 29

Below is a Google Docs graph with Sales and Pirates numbers plotted together, with the actual numerical info removed. I didn’t put a marker to indicate the threshold from one period to the other, because I feel it should be relatively obvious.

What were the stat changes?
- Period 2 had 38.6X more Pirates than Period 1
- Period 2 had 2.3X more Sales than Period 1

- (For every 15 or so Pirates, I received an extra Sale)

Why am I not extremely angry?
It’s pretty obvious why developers get upset about piracy: uh, it’s stealing. Aside from that, I’m pretty straightforward about the fact that decisions should be profit-driven. Throughout Punch ‘Em!’s paid lifetime, I couldn’t raise its sales count in the long term. So if thousands of users end up pirating my app, but hundreds buy it as a result of hearing about it from their pirate buddies, why should I cry?
My app has a sharing feature: if you like the app, you can email your friends about it. As a result of the increased amount of users, the people who are stealing my app are slowing telling others about it, increasing the amount of users who actually purchase the app from the app store.

Why don’t I put in code to try and convert these pirates?
Interesting thing, I had code in previous versions which did just this. It checked (through various means) if the IPA had been cracked, displayed a message asking that they purchase the app, and exited. My conversion rate was 0%. Beyond the conversion rate issue, my app was pirated very little--after all, my app quit almost immediately, so why share it at all?

Bottom line: people stealing my app has increased my sales.
The alternative for me is no pirates, but fewer sales.

Last Section: Why wasn’t it Christmas?
The Christmas push is the result of a simple concept: more new devices & gift cards leading to more paid sales. Because of this, most paid apps see proportional sales increases over the course of Dec 24 - Dec 26. Meaning:
1- The Christmas push only really effects a period of a few days
2- Most developers see very similar sales increases of approximately 2X
3- Despite the sales increase, apps don’t increase in rank (because everyone’s sales go up).

My sales increase extended well past Christmas, and is still stable.
My sales increase during Christmas was well beyond the standard 2X.
My app increased in rank over the period of time that my app was pirated.

Some sources regarding the Christmas push: 
Camera+ Reaches Over 78,000 Sales on Christmas Day Alone
A Christmas iFart explosion: Nearly 40,000 downloads and $30,000 net
CubeCheater: 15 Minutes of Fame
Flurry Holiday 2009 Report: App Store, iPod Touch Shatter Records

Posted
AuthorDaniel Amitay