I think you guys see this in a quite a negative way. There is obviously more apps these days but the market is also massively bigger than 2009. 2009 the iPad didn't even exist, now there must be about 200 million users. For the iPhone the difference is equally drastic.
If the only way you can think of winning is to be the first or there to be no competition you need to think more like Apple. Don't be the first to market but make the best app.
I don't think it's really negative as much are realistic about a market that's long been flooded.
You're right about the growth of the people using devices, but the growth of the number of apps and more advanced apps are the real issues.
More people vs more apps:
People still go thru the same process of discovery of apps, there's just more people doing it. In other words, if more people drive cars, they still drive the same way, there's just more of them The process of finding apps or getting your app discovered is much different.
Consider: If you have a local grocery store that serves 10K people, then the number of people grow to 20K people and they carry the same number of products, you simply process the people fast and/or it takes longer.
Now consider the same grocery store that once had 150,000 products and now has 1,500,000 products ... there's just too many products to look at and much harder to pick the one that's best for you.
About 25% of all apps downloaded are run ONCE.
Look at the web. Do a Google search and see how many results you get. If you get 15 million results for a search, are you really going to go through ALL 15 million of them and evaluate each and every one?
NO, nobody is. Most go through the 1st 2 pages then leave.
Look at your browser bookmarks. You probably have around 100 or 200 bookmarks. What about the billions of web pages you don't have booked marked?
How many unique web sites do you visit each month? How many of those unique web sites to you bookmark AND go back to more than a few times each month?
This is the same way the app store works. Go to a site that shows web traffic. You'll see the top 20 probably account for more traffic that ALL THE REST combined. Those are probably YouTube, Google, Bing, FB, etc...
There was a study done on Twitter. They looked at 400,000 accounts and found the over 85% were following or being followed by ONE... ONE!
Read the article that I linked to above (prior post).
The fact is that Apple could remove 500,000 of the lowest downloaded apps and almost nobody (other than the developer) would know or care.
The 2nd issue is that apps are more advanced, no more flashlights. Professional developers that have been here since or near the start, already have 2+ years head start. Coming in at ground zero is all the harder and would (should) at least include a great idea.
Your point about not having to be 1st is correct, top apps can get busted off the top at any time and often do. Some also OWN the top. EA, Disney, and others have marketing machines that the Clintons would envy.
It's not about having a great idea. I read about a timer that was all over the stock timer and any others. It wasn't just based on looks, it had great functionality and very configurable (IIRC). It never hit the tops, nobody could find it even if they were looking for it.
Years ago, I was watching iPadToday and went to the app store to look at the app they were talking about. I couldn't find it. I finally found it by a link from their website. -- Discovery sucks, and it's very expensive, this isn't likely to change.
Consider: If you came up with a much better version of some popular app, how would you let people know? Review sites? good luck getting there. Face the fact that you are one of about 1.5 million and that's that. EVERYONE thinks there apps are great/better and everyone want to tell the world to download their app...
A flood of water is much different than a flood of boats. Downloaders are downloading more, but that doesn't mean that the more has changed the distribution of what % of apps get downloaded enough to make it work.