Copyright, Legal Notice and Disclaimer:

This publication is protected under the US Copyright Act of 1976 and all other applicable international, federal, state and local laws, and all rights are reserved, including resale rights: you are not allowed to give or sell this Guide to anyone else. If you received this publication from anyone other than freetheapps.com, you've received a pirated copy. Please contact us via e-mail at support at contactus@freetheapps.com and notify us of the situation. Please note that much of this publication is based on personal experience and anecdotal evidence. Although the author and publisher have made every reasonable attempt to achieve complete accuracy of the content in this Guide, they assume no responsibility for errors or omissions. Also, you should use this information as you see fit, and at your own risk. Your particular situation may not be exactly suited to the examples illustrated here; in fact, it's likely that they won't be the same, and you should adjust your use of the information and recommendations accordingly. Any trademarks, service marks, product names or named features are assumed to be the property of their respective owners, and are used only for reference. There is no implied endorsement if we use one of these terms. Nothing in this Guide is intended to replace common sense, legal, medical or other professional advice, and is meant to inform and educate the reader. Have fun and good luck!

Copyright 2011 Free the Apps! All rights reserved worldwide.

Contents
Copyright, Legal Notice and Disclaimer: ......................................................................................... 1 Contents ........................................................................................................................................... 2 Introduction ...................................................................................................................................... 3 The Story of Free the Apps................................................................................................................ 4 The Co-founders ............................................................................................................................ 4 How the Company Started ............................................................................................................. 4 Our Applications ............................................................................................................................ 5 Earnings....................................................................................................................................... 10 Can You Really Make Money from Free Apps? ............................................................................... 14 How to Make Money from Free Apps ............................................................................................. 15 How One App Can Boost Another ................................................................................................ 16 Conclusion ...................................................................................................................................... 18

Introduction
Have you ever wondered why there are so many free apps in the app store? Sure some people genuinely want to make apps for no other reason than the challenge, or opportunity to make something funny or cool. But this is not nearly what most of the free apps out there are actually doing. In fact theres a very good reason why some people choose to turn their hard work into a free app. Paid is not the only way to go. This ebook is about showing why and how free apps actually do make money, and can mutually support each other with cross-promotional strategies. Here we will show you how you can best take advantage of this phenomenon. There are actually plenty of ways to do this. This ebook is meant to be used as a companion guide to our main book How to Make iPhone Apps With no Programming Experience which explains how to build the app which you will give away freefor profit.

The Story of Free the Apps

The Co-founders
We, Quoc Bui and Michael Moon, are the co-founders of Free the Apps!, Moon Apps, Pici Apps, Hipposoft, and Thinking Drone LLC. As San Diego natives and childhood friends, we started our entrepreneurial ventures together with a couple of simple ideas. Apps range from simple, short, and sweet to complex and complicated. You only have to be creative enough to come up with an idea. This manual will show you how to do the rest. Our success has provided us with the luxury of passive income and freed up more time to enjoy the things we love. Our most successful application up to date (1/20/10) has reached a high of rank #3 in the entire app store out of 145,603 total applications. We started by outsourcing one application and have used the profits from that application to start many more. We currently have over 20 live applications that are earning us passive income in the Apple iTunes App Store.

How the Company Started

One of the objectives in our first application was to keep it simple, but useful. (We will go into detail about "why?" later). Being avid iPhone users and fans of many photography applications, we began creating apps in this category and branched out to other categories later on. From this, "Free the Apps!" was born. We noticed that the iPhone lacked the ability to crop photos, so we decided to create an application to do this and only this for free. It was very simple. The application allowed the user to select a photo and then crop it. That's it. Nothing else. No bells and whistles. We wanted to offer the application for free, but we still needed a way to monetize it to cover our costs. We decided to use Admob and put an unobtrusive banner on the top of our app. "Crop for Free" was a hit and became the #1 photography application in the Apple App Store for a few months. It was even mentioned in the article "Bringing Big Smiles to iPhone Shutterbugs" from the New York Times.

Crop for Free #1 Top Free Photography HDR for Free #2 Top Free Photography (Aug 21, 2009)

Crop for Free is the icon for Photography (Aug 21, 2009)

Our Applications
Thinking Drone LLC currently has 35 applications on the Apple iTunes App store with over 30 million downloads (statistics as of 3/16/11). We have reached the #1 spot in Photography and the #1 spot in Utilities a number of times. The highest ranking we have hit was #3 overall in the entire Apple iTunes App Store. The following are some numbers for three of our applications (two free applications and one paid).

Flash for Free (statistics as of 3/16/11):

Highest downloads in a single day: 78,752 Total Downloads All time: 3,522,634 Highest rank reached: #7 Overall, #1 Top Free Utilities

Flash for Free #13 Top Free Overall (Aug 21, 2009)

Green Screen Studio (statistics as of 3/16/11):

Highest downloads in a single day: 242 (at $2.99) Total Downloads All time: 25,514 Highest rank reached: #13 Top Paid Photography

Convert for Free (statistics as of 3/16/11):

Highest downloads in a single day: 101,443 Total Downloads All time: 8,697,785 Highest rank reached: #3 Overall, #1 Top Free Utilities

Convert for Free #3 Top Free Overall (Nov 23, 2009)

Convert for Free is the icon for Utilities (Nov 23, 2009)

Panorama Free (statistics as of 3/16/2011)

Highest downloads in a single day: 57,774 Total Downloads All time: 584,613 Highest rank reached: #21 Top Free Overall, #1 Top Free Photography

Panorama Free #21 Top Free Overall (Jan 15, 2011)

Earnings
We know you are interested in the revenue involved in the iPhone application market. Otherwise you wouldn't be reading this book. Let's face it! You want to know if you can make enough money for this venture to be 'worth it'. So let's look at some numbers. Note that in November, we began transitioning our ads over to Google Adsense. November 2009: Free the Apps! Google Adsense: $15,873.57 Admob: $5,600.72 Apple: $4,720.45 Admob: $1,151.21 Apple: $3,435.41

Moon Apps

Hipposoft

Total Earnings: $30,781.36 December 2009: Free the Apps! Google Adsense: $54,657.95 Admob: $1,020.74 Apple: $3,627.36 Admob: $688 Apple: $9,851.81

Moon Apps

Hipposoft

Total Earnings: $69,845.86 January 2009: Free the Apps! Google Adsense: $51,884.56 Admob: $121.68 Apple: $4,769.93 Admob: $301 Apple: $6,850.35

Moon Apps

Hipposoft

Total Earnings: $63,927.52

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January 2011: Free the Apps! Apple iAd: $ 30,668.54 Google Adsense: $38,188.11 Admob: $ 2,715.59 Apple: $2,250.94 Admob: $1,175.15 Apple: $2,454.63

Moon Apps

Hipposoft

Total Earnings: $77,452.96

Christmas this year was great for ALL developers in the Apple App Store!

Shown above are the earnings for November 2009 to January 2010 and newly added January 2011. From November to December, we were personally invited by a representative from the Adsense team over at Google to join their beta program for mobile applications. Google Adsense for mobile applications was not yet open to the

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public and was by invite only, so we were very fortunate to have been presented with this opportunity. By January 2009, the only money we were still getting from Admob-FreeTheApps was from users who hadn't updated their applications to use Google Adsense. We started 2010 with Dash of Color FREE as the #1 Photography app and many more applications in development. As you can see in January 2011, we started using Apple iAd. Nowadays we run and maintain an $800,000 a year business, making apps with no programming experience whatsoever. If you had asked me whether we could do this in early 2009 I would have said it was impossible. The idea to outsource our business was the single smartest decision we made.

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Splash of Color FREE (Now known as Dash of Color FREE) is the icon for Photography (Dec 29, 2009)

Splash of Color FREE (Now known as Dash of Color FREE) #1 Top Free Photography (Dec 29, 2009)

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Can You Really Make Money from Free Apps?

Paid apps are not the only way to earn money from the app store. There have been a number of apps that have made fantastic earnings from serving ads, even while giving away their app for free. Paper Toss from Backflip Studios earns $500,000 a month from in-game ads.

Angry Birds from Rovio earns $1,000,000 a month from Google Ads, even though they offer the game for free on Android devices.

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How to Make Money from Free Apps

Since we now know that paid apps are not the only way to earn money from the app store. The question becomes "But...how do I make money by giving away apps for free?" The same way Google generates revenue from offering Gmail for free. Ads. Free apps is a very lucrative market. You may not have the potential to generate as much money as the #1 paid app, but you do have many of the benefits that paid apps do not. (see Chapter 3, Pros & Cons of Free Applications) Like our recommendation in Chapter 3, we advise you to create both a full and lite version of your app. You will be able to earn income from both. Your lite version will be promoting your full version, while also generating revenue from ads.

Figure 3: Google Adsense on Convert Units for Free

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There are many different ad platforms you can integrate, but the one we recommend using is Adwhirl. Adhwirl is actually not an ad platform, but allows you to implement multiple ad platforms. Their FAQ states, "AdWhirl enables you to monetize your app inventory by allowing you to use multiple ad networks from within one client SDK. AdWhirl makes it easy to allocate a percentage of your inventory to the various ad networks and update your allocations in real time. By utilizing multiple ad networks, you can select the ad networks that perform best for your app and also make sure you have a high fill rate on your inventory." Fact: AdWhirl was acquired by Admob and Admob was acquired by Google. We currently use Google Adsense and Admob. Both are integrated into our Adwhirl account, so we can dynamically mix and match the amount of ads shown from each. Another important advantage of using Adwhirl is the ability to change ad networks without having to update your application's code. Being able to dynamically change ad networks, allows us to avoid the hassle of resubmitting the updated application and go through Apple's arduous process of approval. Nowadays we also use iAds, which is Apples answer to Googles Admob. Since Apple wasnt making any money from free apps, they decided to break into this lucrative market by offering their own mobile advertising platform. While Apple came a little late to the party, they have already come out with some interesting features that Google doesnt offer yet. For example ads served with iAd can open on top of the app rather than opening the browser, the argument being that people tend to not click on ads because they then get taken away from the app. The results have so far been really good for us, and we still recommend trying out different networks to see which ones will give you the best results. You really cant go wrong with using both iAds and Admob, as results can, and do, vary greatly depending on a number of factors. These factors can only really be assessed though, by experimenting with both networks to see what gives you the best rates.

Fact: Apple bought out Quattro so they could compete in the mobile ad market.

How One App Can Boost Another

Cross-promoting across your applications can help them boost one another in ranking. This will allow you to attract users to download your network of apps instead of just downloading one. (See Figure AB2) There are a handful of developers, including ourselves, that do this by creating a "More Apps" button across our apps.

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(See Figure 4) You can use both your paid and free apps to benefit one another. The lite version of your app that you sell for free will reach a broader audience and attract them to your paid apps.

Figure 4: More Apps Button

Figure 5: Cross-promotin

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Conclusion
Our goal with this eBook was to open your eyes to the wide array of possibilities available to you with making money from free apps and using them to boost each other in the rankings. There are a million possibilities in terms of the variety of apps you can develop and tons of potential for big products. You are now equipped with the tools to make money from free apps and use them to cross-promote each other. Now, of course, there are many ways of getting your idea out there, so you really should experiment as we did, to find the solution that will work best for you. This is but the start of a grand journey, where it will end eill be up to you.

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