We've been observing this effect internally at RevenueCat. The number of new apps launching has gone up by 5x in the last year, but the revenue from those cohorts is only roughly 2x larger than previous cohorts.
There is a classic supply glut happening. It's my belief that one of two things happen from here:
1. We are just waiting for these new use cases to diffuse, find their GTM channels, and they will actually incent more spending on the app store because the products are just better.
2. We are already at peak attention and spend on the app stores and the only thing going to cause demand are macro factors like GPD acceleration or population growth (especially in developing markets).
Muddying things further is that ChatGPT, Claude, Grok, Muse, etc are devouring broad categories of apps that are easily substituted with a chat based super app experience. Utilities, trackers, basic information finding. I don't think the current form factor of these apps can consume everything, but it is putting pressure on a good chunk of the existing app economy.
Wild times.