Big Boost Is Forecast for App Stores: eMarketer

Rosy picture for downloads and revenues

JANUARY 25, 2010 – Most smartphone owners use mobile apps, and they constitute a thriving market that will lead to explosive growth in application store revenues, according to Gartner.

More than 4.5 billion mobile applications will be downloaded worldwide in 2010, bringing in some $6.8 billion to app stores. More than eight in 10 applications downloaded this year, however, will be free.

Both total downloads and revenues are set to more than quadruple by 2013, Gartner predicts. The proportion of apps downloaded that are free will also increase in the same period, by 5 percentage points.

Gartner noted that as smartphone ownership increases, smartphone users on average will become less tech-savvy. The company expects such users to be less willing to pay for apps than early adopters.

“Growth in smartphone sales will not necessarily mean that consumers will spend more money, but it will widen the addressable market for an offering that will be advertising-funded,” Stephanie Baghdassarian, research director at Gartner, said in a statement.

Estimates of app store revenues and downloads range widely. Tech researcher Ovum predicted in November 2009 that worldwide app store revenues would reach only $5.7 billion in 2014. In December 2009, ABI Research projected only 5 billion mobile app downloads by 2014. And Screen Digest forecasts 4.4 billion app downloads from the Apple store alone in 2010.

For the US market, Yankee Group predicts 1.4 billion app downloads, bringing in $573 million in revenues. The researcher expects revenues to increase to more than $4.2 billion in 2013, when US consumers will download nearly 7 billion apps.

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