I recently downloaded Endless Alphabet by Calloway Arts (designers of the terrific The Monster at the End of This Book), and it has quickly become a favorite. Two immediate advantages: it's free AND contains no ads, a rare combo these days. I don't mind ads on my apps, but too often they frustrate my son when he can't get them off the screen or gets taken to the App Store or web browser repeatedly when he accidentally hits them. So no ads is a big selling point in a toddler app. UPDATE: Ads have now started appearing, although they are rare. About once or twice a day one pops up, usually when he starts up the app. They aren't as bad as ads in many free toddler apps, but still a bit of an annoyance. I paid the 99 cents to make them go away.
The game here is simple enough, but keeps him engaged for a good long time. You pick a word out of the ever-changing lineup (the app downloads new words regularly - again, this is FREE!):
Then you get a straightforward puzzle, putting the letters into place. It's got enough of a margin of error that he rarely gets frustrated, and is smart enough to let him move two letters at once if he wants (another important toddler feature - letting them touch however they want).
When the puzzle is done, they are treated to a short animation about the word with a voiceover giving its definition.
And that's it - now you go to the next word or pick a new one! He can easily spend 15 minutes at this, which is as long as anything keeps his attention.
I think he's right at the perfect age for this app. A few months ago, his fine motor skills weren't quite good enough for this type of puzzle. By the time he can recognize all the letters on his own, simply slotting them into place won't capture his attention for very long. But it's perfectly designed for a two-year-old.
If I have one complaint, it's that the letters don't always say the right sound - an E will always say its short sound, even if its long sound is used in the word. But this is really a very minor in an outstanding (and did I mention FREE?) app.