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Mobile app market worth USD17.5bn by 2012
The global app economy is set to explode in the next two years, with mobile app downloads set to almost double and the market expected to be worth USD17.5bn by 2010, according to a new report commissioned by GetJar. The study, put together by Chetan Sharma Consulting, claims app sales will exceed CD sales in 2012, in part due to continued improvements handset technology.
The study predicts that app downloads across all types of handset will increase from some 7bn downloads in 2009 to almost 50bn in 2012 - a year-on-year increase of 92%. As an indication of this momentum, the number of app stores on the market jumped from eight to 38 last year and is expected to continue rise in 2010. However, GetJar predicts market consolidation, with the biggest players such as Apple's App Store expected to take the lion's share of revenues.
"There is no way that this many app stores will survive in the long term and while the value of the global app economy is set to be astoundingly high by 2012, we think only a few app stores will share this revenue," says GetJar founder and CEO Ilja Laurs. However, he adds: "with the consumer appetite for mobile apps rocketing, the opportunities for developers are huge."
The study claims high-end smartphones, such as the iPhone and BlackBerry, as well as 'feature phones' made by the likes of Samsung and Nokia, will benefit from the app craze. GetJar claims "the line between powerful feature phones and smart phones is blurring" but notes that uptake of high-end phones is quick in key markets such as the US.
Currently, apps are most popular in Asia, with the region accounting for 37% of all app downloads in 2009. However, users in North America spent the most money on apps, accounting for over 50% of revenue. The average price of an app in North America was USD1.09, compared with just USD0.20 in South America and USD0.10 in Asia. App revenues in the developed markets of Europe and North America are expected to hit USD8.5bn and USD6.7bn respectively in 2012.
"The app ecosystem is adjusting across multiple dimensions and thus expanding the revenue opportunities," says Chetan Sharma, the president of Chetan Sharma Consulting. "The growth in the quality of mobile advertising is also opening up new revenue streams for developers."
Ads were responsible for 12% of overall apps revenue last year. However, this share is expected to more than double to more than 28% by 2012, with ad-supported apps predicted to appeal to pay-as-you-go customers in developing markets.
