A new report suggests that Apple's practice of leveraging ideas from its third-party developer community to create new iOS and Mac features and apps comes at a high price. With the release of iOS 18 earlier this year, Apple's changes could impact apps that have an estimated $393 million in revenue today and have been downloaded about 58 million times last year, according to an analysis from app intelligence firm Appfigures.
At Apple's Worldwide Developers Conference each June, the iPhone maker teases upcoming releases of its software and operating system, often including features that were previously only available through third-party apps. The practice is now so common it's even got a name: “Sherlocking” — a reference to a 1990s search app for the Mac that borrowed features from a third-party app called Watson. Now when Apple launches a new feature that was previously the domain of third-party apps, it's said to have “Sherlocked” the app.
In prior years, Sherlocking apps made a certain amount of sense. After all, did the iPhone's flashlight really need a third-party offering, or would it be better as a built-in function? Plus, Apple has been able to launch features that better align its software with the wants and needs of consumers by looking at what's popular among the third-party developer community.
Of course, this practice also raises questions about whether Apple is leveraging proprietary data to decide on its next creation, and whether the apps it competes with are being given a level playing field. For example, before Apple launched its own parental control system, it shut down several third-party apps doing business in this area, saying their solutions no longer complied with its terms and policies. Apps were not given access to the developer APIs to manage Apple's built-in parental controls for years, triggering an antitrust investigation.
In recent years, Apple has “Sherlocked” third parties by launching features like the Continuity camera, medication tracking, sleep tracking, and mood tracking, as well as apps like Freeform and Journal. This year, it turned its attention to password managers, call recording and transcription apps, custom emoji-creating apps, AI-powered writing tools and math helpers, trail apps, and more.
In an analysis of third-party apps that generate more than 1,000 downloads per year, AppFigures discovered several genres that were in Apple's crosshairs in 2024.
In terms of worldwide gross revenue, these categories have generated significant income over the past 12 months, with the trail app category earning the most at $307 million per year, led by market leader and 2023 Apple “App of the Year” AllTrails. Grammar helper apps, such as Grammarly and others, also earned $35.7 million, while Math Helper and Password Manager earned $23.4 million and $20.3 million, respectively. Custom emoji-creating apps also earned $7 million.
Of these, trail apps accounted for the vast majority, or 78%, of “potentially Sherlocked” revenue, as AppFigures noted, as well as 40% of downloads of Sherlocked apps. In May 2024, they accounted for an estimated $28.8 million in gross consumer spending and 2.5 million downloads, which gives you an idea of the scale.
Many of these app categories were growing rapidly, with math solvers seeing revenue growth of 43% year-on-year, followed by grammar helpers (+40%), password managers (+38%) and trail apps (+28%). However, emoji-making apps saw a decline of -17% year-on-year.
In terms of downloads, grammar assistants were installed 9.4 million times in the last 12 months, followed by emoji makers (10.6 million), math-solving apps (9.5 million) and password managers (457,000 installs).
While these apps certainly have dedicated user bases that may not immediately choose to switch to a first-party offering, Apple's ability to provide similar functionality built-in could be detrimental to their potential growth. Casual users may be satisfied with Apple's “good enough” solutions and won't seek alternatives.
However, apps that continue to develop new features and add enhancements beyond those included by Apple, as well as take advantage of other new ways to reach users, such as through Apple's enhanced Siri, may perform better than others.
