36 Percent of Mobile App Downloads Generate 71 Percent of Total Revenues
The Apple App Store now accounts for 65 percent of total revenues globally, with Google Play gaining ground rapidly in the last six months with 35 percent market share.
Much of this revenue development is due to the success of games monetization across all countries, accounting for 71 per cent of total revenues, according to a report commissioned by the MEF.
While established markets continue to dominate, the report also identifies the current limited impact of the Apple App Store and Google Play in growth markets, with the largest of the growth markets analyzed - Brazil - still sitting outside the top ten countries with 1.18 per cent of total revenue generated by both app stores.
In the US and extrapolated globally, freemium (free download coupled with in app purchases) is the dominant business model. 86 percent of the revenue in the App Store and 94 percent in Google Play is generated by following this model.
Seven percent of the revenue in the App Store and Four percent in Google Play is generated by pure-play pay once apps and seven percent and two percent of the total revenue is generated by paid applications with in app purchases respectively.
Western markets' revenue potential is slowing down (benchmarking Aug 2012 - Aug 2013)
The United States and the United Kingdom show a much lower growth rate, while strong growing countries show larger increases. South Korea is growing the fastest, growing year-on-year by a factor of ten, Japan by a factor of four and China by a factor of 3.5. The US and the UK both show a growth factor of below two when benchmarked against statistics from 2012.
Which apps are popular?
Games is the dominant category with 36 percent of all downloads, and generates over 71 percent of all revenue across the Apple App Store globally. Other entertainment apps come second in popularity with eight percent of all downloads, but only generate two percent of total revenues. And, whilst the social networking category is sixth in terms of download volumes, it generates around three percent of total revenues.
Google Play shows even higher levels of revenue generated from the Games category with 89 percent of all revenue coming from games.
The report also breaks this down by country showing that games are most popular in China with 92 percent of all downloads and least popular in India.
Percentage of total revenue generated from the Apple App Store and Google Play according to Distimo's data:
- Brazil 1.18%
- Mexico 0.73%
- UAE 0.26%
- India 0.22%
- Philippines 0.193%
- SA 0.192%
Growth markets make up a small percentage of the total value of all of the revenue generated by Google Play and the Apple App Store in the top 40 countries listed in the report. This reflects the smartphone penetration and the dominance of mobile operator-led mobile content. However, these markets are growing and represent a major opportunity for the app economy.
Rimma Perelmuter, CEO at MEF said: "The global mobile ecosystem continues to expand into new markets and vertical sectors. Understanding the prevailing business models and regional variances that underpin this growth is essential to helping mobile businesses identify new opportunities across growth markets. MEF will address these trends in San Francisco next month at MEF Global Forum where we will gather and engage the industry's foremost thought leaders."