Tracking The Growth Of Mobile App Industry – 15 Points In 15 Minutes

By | October 24, 2014
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The global mobile app market has got to be one of the most flourishing sectors in the domain of software technology. Android and iOS are by far the two most popular app development platforms. Let us here look back at some of the key events in the amazing growth story of mobile applications.

 

Close to 220 billion downloads per year, and a staggering $65 billion in revenue. These are the figures that the global mobile app industry has been projected to reach by 2017. iOS and Android are the two biggest players, with Blackberry and Windows Phone having significant presence as well – and new app development platforms like Tizen (Samsung’s in-house OS) and Firefox OS rumored to be released soon. We are in the midst of a white-hot app revolution worldwide, and this would be just the ideal opportunity to take a look back at the evolution and growth of this now-burgeoning business sector:

 

  1. First-generation mobile applications – These were nothing like the fancy software that modern-day mobile app companies churn out. ‘Snake’ – the insanely popular mobile game on Nokia handsets – made its debut in 1998 (a full half a decade after the first mobile phone – Motorola DynaTAC 8000X – had hit the market). Apart from simple arcade games, other popular apps at that time included calculators, mobile ringtone composers and editors, and calendars.
  2. Arrival of the Apple App Store – The first iPhone was launched on 9 January 2007. At that time, there was no designated store from where early adopters could download apps from. Things changed radically with the opening of the Apple App Store, in July 2008 (a fairly long wait!). There were 500 iPhone apps at the store to start off with. With the start of the App Store, the concept of native app development received a huge boost.
  3. Popularity of apps – It did not take long for smartphone users to warm up to the idea of downloading and using apps. Within the first weekend after the launch of the Apple Store, the total number of app downloads had crossed 10 million. Steve Jobs and his team had upped the smartphone sector with the iPhone, and there were already plenty of applications to complement the handsets.
  4. Android debuts as the chief rival – There was no first-mover’s advantage as such for Apple, as far as mobile apps were concerned. On 22 October 2008, the Android market came into being. The total number of Android apps available at that time stood at a rather modest 50 – but this figure started to go up at a fairly rapid clip. By February next year, Android device-owners could download paid apps from the store.
  5. From analog to 4G – Let us take stock of the evolution of mobile networks at this point. The first set of cell phones (we are talking about the ones in the late-80s and early-90s here) ran on analog, or 1G, environments. The functionality of these phones, as is understandable, was pretty much limited. Then came the GSM or 2G environment – bringing with it a host of features, from text messaging and internet access (albeit at painfully slow speeds), to download options for basic mobile applications (like music files and simple games). It was only after 2003, when 3G had become available, that the app industry really started to gain momentum. Wi-fi data access was one of the chief benefits of the 3G environment. At present, mobile service providers are pushing 4G connectivity – which takes up the speed of digital media access, data transmission, web browsing and app downloads to an altogether different level.
  6. The rest of the competitors – Considering the overwhelming combined superiority of Apple and Android in the worldwide mobile app industry – it won’t be wrong to club together information about their wannabe challengers at one place. Blackberry App World, powered by Research In Motion (RIM) came into being on 21 October 2008, with developers being allowed to submit customized BB apps at the store from January the following year (the store went live in April 2009 though). Nokia had its Ovi Store, which, after a promising start in 2009, soon went out of steam. The Windows Phone Marketplace started in October 2010, and within a year, it had more than 30000 applications.
  7. Download of the billionth app – Although it did not have a free run, iOS was the runaway leader in the early stages of mobile app development and downloads. The App Store touched the magical figure of 1 billion downloads on 23 April 2009. At that time, the Play Store had less than 6000 apps, and Blackberry App World had only about 2000 (the Nokia Ovi Store had not even reached the 600 apps mark at that time). The Android platform completed a billion downloads in August 2011.
  8. Change of leadership – While Apple remains till date the most profitable (in terms of revenue) platform for mobile app developers, Android devices enjoy close to 85% of the overall smartphone market. The change of guard took place in October 2011, when reports showed that Android had captured 44% of the market, with iOS accounting for a shade over 30% of total app downloads. Since then, this gap has kept widening.
  9. Free vs paid apps – Free apps have always been dominant across all the application development platforms. When Google Play Store had 20000 apps, nearly 63% of them were free (this was in September 2009). Among the 225000 applications at the Apple store in April 2011, only 27% were paid applications. The difference was even more stark at the Nokia Ovi Store, where 85%-90% of the apps were free. At present, the ratio of free apps to paid apps at the Android store is approximately 5:1. This, in turn, brings into focus the importance of in-app ads and other methods of mobile app monetization.
  10. Emergence of J2ME apps – This coincided with the increase in demand for feature phones (when smartphones were not yet really popular). Many mobile app companies started creating applications for the Java Micro Edition platform, on JSR 68. Coders for Java apps could use resources from the Mika VM class libraries, which were available on the Java ME platform. To this day, new developers are often given Java projects to start off with.
  11. Per day downloads – A key metric in the mobile platform wars. The Apple Store registered 1.5 million app downloads per day, as early as in September 2010 (projected to surpass 100 billion by the time 2017 draws to a close). By mid-December 2010, Nokia Ovi Store had reached a daily app download figure of 3.5 million. This figure grew to 6 million content downloads per day within the next six months. Blackberry App World was also showing rapid growth, with over 2 million daily app downloads in February 2011 (this figure swelled to 6 million by the next year). By June 2012, Google Play Store had also reached the one million-per day download mark.
  12. Money matters – Mobile app development is fast closing in on being a $25 billion industry. When the revenue distribution is considered, Apple still has a stranglehold over its closest rival – Google Android. The top grossing apps from the Apple Store earn around 5 times more per day than the featured ones at the Google Play Store. However, with the faster growth of freemium services on Android apps, and the overwhelming market share – it is expected that Android might start raking in more moolah from its apps than Apple, by 2018. Time for specialized Android app developers to get excited?
  13. The rise and fall of Blackberry apps – Everything looked rosy for RIM Blackberry when App World went live in ten different countries in Europe (in June 2009). Before the year had ended, the store boasted of more than 3500 applications. And then, started the slide – with both iOS and Android overtaking it with ease. At present, while the latter two have over 1.3 million downloadable apps each, the total count of Blackberry applications stands at less than 140000. There are silver linings though – many compatible Android apps are now showcased at the Blackberry App World now, and the Amazon App Store is coming to all Blackberry 10 devices. BB is no longer a serious challenger to Apple or Google at present, but things can change if the Blackberry Passport can turn around the fortunes of Blackberry 10.
  14. Average price of apps – Availability of a considerably larger number of free apps (in comparison with the Apple App Store) have contributed to the strong performance of the Android Market. The average price of an Android app is around $0.06 – around three times lower than the average cost of an iPhone application. iPad apps, which have an average price of $0.50, are the most expensive set of applications. For app development experts, there is more money to be earned (on a per download basis) from iOS apps than on Android apps. When the Blackberry 10 platform had launched, it was widely expected that it would make BB the most profitable platform for developers. That has not quite materialized. It remains to be seen which one out of iOS 8 and Android 5.0 Lollipop turns out to be more lucrative for developers (both have a wide range of new APIs).
  15. Which genre of apps is the most popular? – At the Apple Store, gaming apps (with a share of over 20%) comfortably occupies the top position. Education apps (including mobile apps for kids) and business applications round off the top 3 categories for 2014. Rather surprisingly, social networking apps make up a lowly 1.9% of the total number of downloads. At Google Play Store, however, social networking apps (or Communication apps) are much more popular – although they trail mobile games here too.

To enable faster download of online digital media, Apple launched the iTunes store in April 2003. By 2010, it had become the biggest store for music and media-based apps in the world. There is a growing buzz about the Firefox OS, the Tizen platform and the Ubuntu Touch – which can come up as potential challengers to iOS and Android. Interestingly, United States is not the country where the maximum number of apps are downloaded (South Korea holds that position, with USA coming in at 6th). In December last year, the mobile app market in Asia registered an annual growth rate of over 160%, while North American markets grew at an impressive 46% too. Mobile apps have indeed come a long way from ‘Snake’ on Nokia – and it is all set to expand more in terms of app-availability, downloads and revenue even further in future.

 

Hussain Fakhruddin
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Hussain Fakhruddin

Hussain Fakhruddin is the founder/CEO of Teknowledge mobile apps company. He heads a large team of app developers, and has overseen the creation of nearly 600 applications. Apart from app development, his interests include reading, traveling and online blogging.
Hussain Fakhruddin
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