The app market will double its value by 2020

The App Annie brand, which analyzes the state of the application industry, published a report estimating the state and evolution of the value of this market. According to the company, the value generated by applications In 2016, it exceeded 51 billion dollars and it is assured that, if this pace is maintained, it will double by 2020, reaching 101 billion dollars.

Global state of the app market

Global growth will be promoted by two factors: the increase in Application usage in emerging markets and the improvement of revenue generated by payment applications in mature markets. Mexico, Argentina, India and Indonesia have enormous growth potential in this market, which, despite the global recession, has not stopped growing strongly. Argentina and Brazil have grown by 401Q4Q year-on-year over the last year. At the same time, mature markets will continue to grow. China has already managed to overtake the United States in terms of revenue generated by applications, in part because North American users have reduced the number of apps they download. Still, total spending per download has increased, which will lead to a general increase in revenue for app stores and developers.

App revenue streams

Global revenue generated by the App Store and Google Play, the world's two largest app stores, rose 40% Q4Q from $25 billion to $35 billion. App Store Revenue represented 70% of the total generated by sales of applications in official stores. If we add the alternative stores to Google Play and revenue generated by advertising, total revenue reached $89 billion during 2016. This value is not taking into account sales generated through the physical market or services. online-to-offline Apps like Uber and Cabify, which pay for their services not through app stores but through their own payment gateways, are the most popular. App Annie estimates that there will be 284 billion downloads in 2020, which will mean that the smartphone user base will have doubled by then. The largest relative growth is expected to occur in the App Store in 2017, although it will end up being surpassed in revenue by Google Play thanks to the popularity of the app store. Android in developing countriesBy app category, the largest share of revenue came from video games, accounting for 751% of revenue in the App Store and up to 901% in Google Play. The largest revenue generating video game category, accounting for 501% of the total, was RPG games.

App download rate

In 2016, there was an increase in 15% downloads, from 77 to 90 billion worldwide, taking only the App Store and Google Play as a reference. This number was especially driven by emerging countries, where new smartphone users tended to download more apps, especially those of the social or messaging type. Mature markets such as the United States, Japan and Germany are slowing down the increase in the number of downloads, but increasing in revenue and user loyalty. Globally, time spent on apps grew by 631 TP4T on Android between 2014 and 2015. App usage will once again enjoy a significant increase in downloads driven by platforms such as wearables, Smart TV, platforms based on augmented reality and virtual reality devices, the Internet of Things (IoT) and smart cars. The good health of an app can be measured by the time the user spends interacting with it. According to the App Annie infographic, the total time spent on Android globally, excluding China, increased by 251 TP4T in 2016, going from 720 to 900 billion minutes. The country with the highest smartphone use was India, which accumulated a usage of 150 billion minutes, followed by Brazil with just over 110 billion.

Revenue by app category

Video games are the biggest revenue generator for the app industry. Other apps account for 251% of total revenue. App Annie estimates that the $101 billion in revenue will be generated primarily by direct sales and subscriptions. By 2020, gaming will account for 551% of total industry revenue, of which $53.08 billion will come from sales and $51.4 billion from advertising. Other apps, which will account for 451% of revenue, will generate $65.8 billion from advertising and $18.8 billion from in-store sales. This shift will be seen as the percentage of total revenue generated by gaming gradually declines to match the revenue generated by all other apps. In 2015, they accounted for 661% of total revenue. Of the other app categories (non-gaming), social and video grew the most.

Ranking by revenue and app downloads

The most downloaded apps

1. Facebook
2. WhatsApp
3. Facebook Messenger
4. Instagram
5. Snapchat

The most downloaded games

1. Pokémon Go
2. Piano Tiles 2
3. Subway Surfers
4. i
5. Clash Royale

The apps (excluding video games) that generated the most revenue

1. Spotify
2. Line
3. Netflix
4. Tinder
5. HBO Now

The games that generated the most income

1. Monster Strike
2. Clash of Clans
3. Pokémon Go
4. Game of War – Fire Age
5. Clash Royale

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