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App Story App Store spending was $1.8 billion in the last week of 2020, up from $1.42 billion the previous year —an increase of 27% vs. an increase of 16% from the previous year. On 1/1/2021 App Store spending reached $540 vs. $386 million for 1/1/2020. This was an increase of 40%. The previous year’s increase was 20%. Developers selling through the App Store have now earned more than $200 billion since the App Store launched in 2008. The previous year’s figure was $155 billion, making the 2020 total $45 billion, a 30% increase from $34.5 billion average of the previous two years. Assuming a proportional increase, overall ecosystem transactions rose to $675 billion in 2020. This places Apple’s valuation at a 3.2 multiple of its yearly ecosystem value and each customer is valued at approximately $1400. The history of App Store revenue and the growth rates involved is shown below. NB: A substantial amount of App Store revenue is derived through subscriptions which now total about 600 million. A simple summary is that the App economy accelerated its growth in 2020. This implies an economic value reaching $1 trillion/yr. within two years. It would behoove the investor to evaluate the value of Apple as a multiple of its ecosystem as well as a multiple of its customer base. As I have repeated over time, the strength and resilience of Apple is in its customer base. Strength in terms of willingness to spend for quality and value and resilience in terms of sustained satisfaction. As that base grows to well over 1 billion people and as this billion are exposed to an increasing spectrum of value options (products, services and ecosystem) the company becomes indispensable. This is quite the opposite of the perceptions widely held even a few months ago. In other news: • Apple added 52 new territories to Apple Music. • Apple TV is now available on over 1 billion screens in over 100 countries and regions, providing access to buy or rent over 100,000 new release and classic movies and TV shows • Apple Pay is accepted at more than 90% of stores in the US, 85% of stores in the UK, and 99% of stores in Australia • Apple Books now draws over 90 million monthly active users • Podcasts are now available in over 175 countries with programming in more than 100 languages •More than 85 percent of iCloud users are protected with two-factor authentication