Mobile Apps: Who is buying the most apps, and where?

By Wendy Boswell on
intel, japan, app store, apps, asia, mobile gaming, google play, apple app store, guest, distimo, wandoujia
Editor’s Note:
This is a guest post by Wendy Boswell, technical blogger/writer at Intel. She's also editor for About Web Search, part of the New York Times Company

A new study from app analytics firm Distimo in partnership with China-based Wandoujia, authoritatively concludes that Asia is now the world’s top marketplace for apps, and that it's leading the charge by large margin when compared to other markets. Year over year revenue from 2012 to 2013 rose by 162% with much of that coming from Google Play.

Compared to the Apple App Store, Google Play’s growth quadrupled in 2013, while Apple grew by 94% in total revenue for iPhone apps, 64% for iPad apps. Here are a few notable highlights from the report:

  • Globally, Asia picked up 41% of total global app revenue in December 2013, as compared to 31% from North America and 23% from Europe.
  • App revenue seems to be evenly split between Google Play and the Apple App Store in Asian countries. Apple still leads in apps in North America and Europe with 75% of app revenue; Google Play takes up the other 25%.
  • Japan was undoubtedly the most lucrative country in Asia, followed by South Korea and China, Taiwan, and Hong Kong.
  • Freemium is the leading business model in Asia.
  • South Korea witnessed the steepest growth in revenue. Money generated in the country grew by 271 percent, with Google Play driving most of that growth.
  • Angry Birds Go! was the most downloaded game in Asia in December 2013, followed by CarrotFantasy 2: Polar Adventure (Japanese release), and The Hardest Game in History (Japanese release). On Wandoujia, China's largest mobile app distribution platforms that is Android-based, the most downloaded app was 12306官方, a railway ticket reservation app.

Asia is the market to watch for growth. According to another report from PortioResearch, while all regions are expected to see growth in their app markets, in some regions that growth will be more accelerated. For example, in North America, already a more advanced market, growth will be more moderate, at a lower rate of 17.7 percent. Other regions will grow faster, but none as fast as the Asia Pacific region.

The total number of apps users in Asia is expected to grow at a rapid 39.8 percent from end-2012 to end-2017. By the end of 2017, the number of apps users in the region is expected to cross the 2 billion mark to reach 2,039 million.

Opportunities for Android

China’s Android ecosystem is decidedly different from the rest of the world. Only 3.5 percent of devices in China have Google Play services installed, which is required in order to run Google Play and other Google apps. Wandoujia is a mobile content search engine for Android, where the largest content vertical is apps, so much of the content in this latest report comes from that data.

Another recent report from Chinese search engine company Baidu revealed mobile trends with Android users in China; hard-won data since most Chinese users do not utilize Google Play as their central app market:

  • 59% use app stores to download their apps, while 13% use online app searches and 21% use their PCs to sideload apps onto their Android devices
  • App downloads for Chinese Android device owners are growing exponentially: the average user downloaded 10.5 apps per month in Q3 2013; the previous year, it was 8.2 apps monthly
  • 15% of Android users in China install at least one new app a day vs. 11% in Q3 2012
  • A large part of Android growth (45%) is focused in rural areas and small cities
  • Android owners spend upwards of 150 minutes a day on their smartphones (this is an increase of 26 minutes from the previous year), checking their devices an average of 53 times a day)

China and SE Asia are considered by most data measurement services to be the world’s largest smartphone markets; with over one billion Android devices being activated worldwide to date. Interested in pursuing this opportunity? Intel offers a wide variety of useful tools for the developer interesting in creating something on Android at the Android Developer Zone, including:

Beacon Mountain: Beacon Mountain provides a complete set of design, coding, and debugging tools for native apps targeting Android-based ARM and Intel Atom processor-based devices.

Intel XDK Cross-Platform Development Kit: Use the power of HTML5 and Intel's cross-platform tools to write your app once and distribute it broadly. With the Intel® XDK, you really can “write once, deploy too many.” Build for iOS and Android, tablets and phones, then deploy to the Google Play Store, Amazon App Store, and more.

Intel® C++ Compiler for Android* OS: For Android app developers using the Android* NDK , Intel C++ can deliver a performance edge. It’s compatible with GNU C++ and tools in the NDK. Improve application fluidity and responsiveness, enhance battery life.

Project Anarchy: Project Anarchy is a free mobile game engine for iOS, Android (including X-86), and Tizen. It includes Havok’s Vision Engine along with Havok Physics, Havok Animation Studio and Havok AI.

Freemium model dominates in Asia

According to another Distimo report, at least 90 percent of all revenue comes from in-app purchases in Hong Kong, Japan, China and South Korea. In China, apps generated 96% of revenue from in-app purchases, while Japan and South Korea had similar rates at 94% and 91%, respectively.

From April to November 2013, the average revenue per paying user for massively multi-player online games grew a massive 400%, beating growth in Japan (282% year-over-year) and Korea (342% year-over-year). A recent report bears this data out, with predictions for the coming years for paid apps vs. freemium monetization models:

Table 1. Mobile App Store Downloads, Worldwide, 2010-2016 (Millions of Downloads)

 

2012

2013

2014

2015

2016

2017

Free Downloads

57,331

92,876

127,704

167,054

211,313

253,914

Paid-for Downloads

6,654

9,186

11,105

12,574

13,488

14,778

Total Downloads

63,985

102,062

138,809

179,628

224,801

268,692

Free Downloads %

89.6

91.0

92.0

93.0

94.0

94.5

More revenue within the Google Play store came from freemium apps with in-app purchases in 2013; from 89% to 98%. The freemium, or “free to play” monetization model, seems to be becoming overwhelmingly successful for most developers, with in-app purchases and level-up opportunities monetizing quite well.

Making money with app development is obviously a strong focus for mobile developers. The rise of the freemium business model, with in-app purchases taking the place of an upfront app purchase, became the most successful monetization model for developers in both the Apple Store and Google Play.

How do developers get into China? Localization wins

In order for apps to be successful in global markets, apps need to be available in local languages; it just makes sense and it also provides developers with a larger fan base that will respond more enthusiastically. The referenced Distimo report makes the need for global localization very clear:

“According to Wandoujia, games by foreign developers “have a big opportunity to reach millions of gamers in China,” as evidenced by the popularity of titles like Temple Run 2, Subway Surfers, Angry Birds, and Fruit Ninja, all of which were among the top seven titles in the country last year. But local developers still dominate non-game apps, just as local software dominated the PC Internet.” - TechCrunch

If users can understand more about the game, it greatly improves the chance that they will download it. Localization doesn’t necessarily just mean translation; developers have to figure out what makes sense with a global audience, and be sensitive to local customs and cultures that might not work with all apps and games. Opportunities continue to open for app developers, and as the Asian app ecosystem grows developers should be taking advantage of what this might mean.

Motley Apps Pattern background from Shutterstock.

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