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China passes US for iOS app spend

News, 25 October 2016

SAN FRANCISCO/BEIJING: The US and Japan were until as recently as last year the most important revenue markets for Apple apps, but now China has overtaken them both to become the iOS App Store's largest market.

According to the Market Index Report for Q3 2016 from App Annie, the app intelligence firm, China generated more than $1.7bn in revenue for the iOS App Store, or 15% more than the US.

Moreover, the Chinese appetite for apps shows little sign of slowing down and App Annie forecasts that growth in China will carry on through to 2020.

Not surprisingly, revenue from games accounted for the majority of revenue generated in China, but the report pointed out that other categories, such as social networking and entertainment, are "making strides" and have more than tripled in the past year.

However, even though non-game apps accounted for the great majority (75%) of the total, gaming remains very important because it generated 75% of App Store revenue. And thanks to video-streaming, games are also the fastest-growing category in China.

To illustrate the global importance of games for App Store revenues, the report highlighted Pokémon Go, which beat all other apps in terms of global earnings growth.

Global consumers spent $600m on the game, a rate 2.5 times faster than Candy Crush Saga and over 6.2 times faster than Clash of Clans, TechCrunch reported.

While its popularity may be waning, out of the top 20 game apps in the world, Pokémon Go alone still accounted for 45% of total time spent in-app in Q3.

But the standout finding in the report remains the emergence of China as the global leader for app revenues, which prompted App Annie to urge developers and marketers to adjust their strategies, if required.

"As an app publisher or marketer, if China wasn't a key priority in your app strategy, is should be now," the report said in comments reported by e27.

"Understanding how to enter this market by learning the complexities of local infrastructure and unique cultural preferences is crucial to your app's success."

Data sourced from App Annie, TechCrunch, e27; additional content by Warc staff