Mobile apps set for rapid growth

10 November 2010

PARIS: The mobile applications market will be worth almost €7bn ($9.7bn; £6bn) in three years time, fuelling competition among brand owners to gain ground in this increasingly important sector.

IDATE, the research firm, argued apps and their related stores are now the "pivotal talking point when discussing the current and future mobile landscape."

One reason for this trend is that a range of companies have a stake in the success of applications, from handset manufacturers and telecoms providers to online publishers and developers.

By 2013, it is estimated this industry should reach a value of €6.9bn, as rivalry intensifies between the major players, according to Soichi Nakajima, a senior consultant at IDATE.

At present, there are around ten operating systems (OS), but this number is expected to diminish so just a "select few" remain.

Nokia boasted a 41.9% share of the OS market as of Q2 2010, ahead of Research in Motion's 18.5%, Google's Android' 17.9% and Apple's 13.4%.

"For the mobile handset manufacturers and the internet giants, the battle of the fittest is underway, to settle who becomes the dominant smartphone OS, not the largest application store provider," said Nakajima.

Given that potentially billions of feature phones could be replaced with smartphones in the future, many consumers will ultimately access the pre-eminent system.

IDATE suggested Nokia occupies the best position, as it holds a 33% share of the whole mobile market, and is building devices aimed at mainstream subscribers.

"Nokia currently leads, by a significant margin, with RIM, Google and Apple the chasing pack," said Nakajima.

"Out of these three only Google is currently in a position to really challenge the dominance of Nokia. Apple is targeting the high-end market, rather than battling for total dominance."

While Apple and Research in Motion may appeal to attractive demographics, Google and Nokia are more likely to become the industry "standard", making them hard to ignore, even for competing handsets.

Data sourced from IDATE; additional content by Warc staff