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Mobile Apps: Downloads In Asia Expected To Grow…Revenue?

There were 7 billion mobile application downloads in 2009, and this is set to increase at a Compounded Annual Gross Rate (CAGR) of 92 percent to 50 billion by 2012, according to a report by Chetan Sharma Consulting commissioned by applications retailer GetJar. Revenue from mobile apps, including from downloads, advertisements and virtual goods is expected to increase from $4.1 billion in 2009 to as much as $17.5 billion by 2012.

Asia: Share of Downloads vs Revenues

What’s interesting is that while 37 percent of an estimated total 7 billion global applications downloads in 2009 was from Asia, in terms of revenue, the contribution was rather low. It appears that in Asia, the freebie (or just the advertising supported model) is what is gaining traction. Expectedly, even as the number of application downloads for Asia grows, it is estimated that revenue share will not match up. Mobile advertising is expected to play a greater role in Asia.

China and India are identified as predominantly featurephone markets; in Asia overall 90 percent devices are featurephones. In these markets, where subscribers are mostly pre-paid, operators will have to offer more data plan choices to convert subscribers to data users. We’ve already seen that in India, with innovations in pricing in particular from Aircel and Tata Docomo.

The report warns that in Asian markets where the telecom operators keep 40-70 percent of the share, developers without big budgets will find it difficult to survive. Here in India we refer to it as the “VC Funded VAS Bubble”.

Much more to ponder over from the report. Download here.

P.s.: Methodology: This is based on inputs from over 20 players active in the global mobile apps ecosystem including operators, OEMs, analytics players, measurement companies, content providers and publishers, off deck storefronts, mobile advertising players, application developers, and aggregators. In terms of their methodology, they first estimated the total number of smartphone and featurephone users in five major regions (North America, Europe, South America, Asia, and Middle East and Africa). They looked at the active data subscribers on these devices who are actively downloading mobile apps, and then estimated the number of apps download/user/month by smartphone and featurephone platforms respectively. How they learnt of the number of active data subscribers in India is beyond me.


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