Xyologic is a company that analyzes mobile app sales and trends, and its latest report says that a full 40 percent of game downloads from Apple's App Store consist of freemium titles -- games that are free to download, but make money with ads or in-app purchases. Ngmoco made a big splash a while back by saying that freemium was the future of the App Store, and according to this report, that is turning out to be more and more true.
Xylogoic says that there were 99.9 million downloads of free iPhone games last month, and 80.8 percent of all app downloads were of free apps. It's well known that free games have a wider audience than paid apps (just because the barrier to entry isn't there), and while some developers say that the free audience is always better, the question has always been how to monetize all of those users.
In-app purchases seem to be working -- the number of free games with in-app purchases available on the App Store is rising every month, and of the top 150 free games on the store, Xyologic says that 94 of those (63 percent) are making use of in-app purchases. There are certainly still apps benefiting from other models, but there's no question that freemium is still growing as one way to put a successful app on the App Store.