Asia set for apps boom

09 September 2011

SYDNEY: Consumers in Asia Pacific will download nearly 5bn apps this year, as rising smartphone penetration and digital literacy fuel greater demand for these tools.

Ovum, the research firm, reported that mobile phone users across the region accessed 1.6bn applications during 2010 as a whole, a figure set to treble this year.

Looking even further ahead, the company's forecast estimated that 14bn apps will be added to phones by consumers in Asia Pacific in 2016.

In revenue terms, Ovum revealed paid-for applications generated $302m in 2010, an amount projected to reach $871m in 2011, and $2.2bn by 2016.

Apple customers collectively accessed 424m apps in 2010, due to more than triple to 1.5bn in 2011, and then hit 3.4bn in 2016, yielding a combined $808m.

Rival devices powered by Google's Android operating system provided 244m downloads last year, a total pegged to stand at 1.5bn this year, and 6.1bn in five years time.

However, while Google will lead Apple in volume terms, the financial value of this activity on Android should deliver just $394m in revenues by the end of the forecast period.

Windows Phone, from Microsoft, is also anticipated to surpass BlackBerry, owned by Research in Motion, regarding both download levels and paid-for app sales by 2015, the study predicted.

Eden Zoller, consumer telecoms principal analyst at Ovum, suggested affluent mobile users in many markets in Asia Pacific are now highly familiar with apps, and thus more demanding.

"There is less tolerance for second-rate applications and this is making consumers increasingly more selective," she said. "This will affect the number of downloads ... and also how much, if anything, they will be prepared to pay for applications," she said.

More specifically, Zoller warned it will be challenging for brands and developers to create apps able to command a meaningful fee.

"The majority of paid-for apps are in a commodity pricing zone and those capable of pushing above the $5 mark are in the minority," she said. "App-savvy consumers are less willing to pay a high premium for anything but 'must have' apps."

Data sourced from Ovum; additional content by Warc staff