How the World Got Wired · The Phone in Your Pocket

The App Store

About a year after the iPhone launched, Apple made a decision that almost did not happen.

Steve Jobs, initially, did not want the iPhone to run software made by anyone other than Apple. He thought outside software would be dangerous, unreliable, prone to crashing the device. He wanted developers to build web apps — programs that would run inside the iPhone’s browser — and not native apps that would run on the phone itself. Many of Apple’s engineers disagreed. Many of Apple’s customers complained. After about a year of resistance, Jobs changed his mind.

In July of 2008, Apple opened the App Store. It was, at first, a fairly simple thing: a place inside the iPhone where you could browse software made by other companies, and tap a button to download it onto your phone.

It became one of the most important inventions of the modern technology industry.

The App Store turned the iPhone from a single device into a platform — a foundation on which thousands and then millions of other businesses could build. Within five years, there were over a million different apps. Within ten years, over two million. People used apps for everything: to find restaurants, to call taxis, to share photographs, to read books, to play games, to learn languages, to deposit checks, to date, to argue, to sleep.

Whole new companies came into existence that only existed because of the iPhone. Uber, the ride-hailing service, would not have been possible without a touchscreen device in everyone’s pocket that always knew where they were. Instagram would not have been possible without a good camera attached to a good screen attached to the internet. Tinder. Spotify. WhatsApp. All of them ran on a piece of technology that had not existed twenty years earlier.

Apple took thirty percent of every dollar spent in the App Store. This is a high percentage. It is the kind of fee a powerful landlord charges when there is nowhere else to rent. Most of the people who built the businesses that depended on the iPhone hated paying it. Most of them paid it anyway, because the iPhone was where their customers lived.

By 2025, the App Store would be generating tens of billions of dollars a year for Apple — much of it nearly pure profit, since Apple was not actually doing the work of building the apps. Apple was just the gatekeeper. Owning the gate had turned out to be more valuable than owning almost anything else.

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