The app economy is booming. In the first nine months of 2017, £25 billion was spent in the Apple App Store and Google Play around the world, with 95 per cent of revenue coming through in-app purchases. Add in advertising and non-digital purchases and the app economy is expected to reach £4.69 trillion by 2021.
“It’s not just about gaming and entertainment any more,” says Danielle Levitas, senior vice president of research at the app research firm App Annie, who provided the data. Although the number of apps people in the developed world are downloading is levelling off, the amount we’re spending through those apps keeps on going up. “If you think about rideshare, these companies would not have existed without mobile apps,” she says.
Apps are big business: Quarterly revenues broke $10bn for the first time in Q4 2016
China's booming: Google Play is banned in China, so this chart only includes data from the iOS app store – even so, the downloads are sizeable
So is Japan: Although it's well behind in downloads, Japan's app revenue almost matches that of the US
The developing world is starting to catch up, too. India downloads more apps than anywhere else in the world, a number that Levitas expects to keep on going up as the two-thirds of the population that don’t have smartphones right start to buy new devices. And downloads alone are only one part of the picture – out of the world’s developing economies, only Brazil generates enough revenue from apps to earn it a place in the top fifteen.
But the days of the traditional smartphone app might be numbered. Voice-activated assistants such as Alexa and Google Home are taking over from some apps in the home, while in-app bots like those in Facebook’s Messenger are reducing the number of apps cluttering smartphone screens. Levitas isn’t worried, though. In 2017 app downloads grew by 35 per cent, and she doesn’t see any sign of things slowing down dramatically in the near future.
“I just don’t see things fundamentally shifting over the next few years,” she says. “I think these devices are just too central to be dislodged.”
This article was originally published by WIRED UK
