Apple will continue to earn majority of app download revenue in 2012

Apple will earn more than 53% of all mobile app download revenue this year, according to a new report from Strategy Analytics. The research firm expects that the overall price of applications will fall during the year but that carriers, storefronts and developers will continue to maintain a steady stream of high-quality downloadable content in an effort to offset the decline in prices. “The introduction of tablets from Amazon and Barnes and Noble and a renewed push for Windows Phone ensure an intensifying battle for the third horse in the apps ecosystem race,” said Josh Martin, Director of Apps Research at Strategy Analytics. “Unlike paid downloads that offer one time payment, virtual goods allow developers to earn recurring revenue from heavily used apps making the business opportunity appealing. Despite the importance of virtual goods, few platforms beyond the leaders have stepped up. Thus, Android and Apple may well dominate into the future.” The full press release from Strategy Analytics follows after the break.

Strategy Analytics: Apple continues to dominate apps earning more than 53% paid app download revenue in 2012

Amazon, Barnes and Noble, Microsoft and others Fight for Third

Boston, MA – January 6, 2012 – Apps are sure to be the rage at CES as manufacturers look to cash in on the more than 41 billion phone and tablet downloads in 2012.

The average selling price of paid downloads is declining across every major platform, as competition heats up and devices move into emerging markets. To offset this loss, storefronts, carriers, and developers look to virtual goods – an industry which will quintuple in size from 2011 to more than $1 billion in 2012. Apple and Android—both early movers in this space— look to take advantage of their positions to retain developer interest, maintain a steady flow of high quality apps, and keep consumers wedded to their ecosystems.

In order to position their platforms for the future, competitors will need to move quickly into the virtual goods space before Apple and Android consolidate their already sizeable leads in paid downloads (as seen in the chart below).Paid Download Revenue Marketshare 2010 v. 2013

According to Josh Martin, Director of Apps Research at Strategy Analytics, “The introduction of tablets from Amazon and Barnes and Noble and a renewed push for Windows Phone ensure an intensifying battle for the third horse in the apps ecosystem race. Unlike paid downloads that offer one time payment, virtual goods allow developers to earn recurring revenue from heavily used apps making the business opportunity appealing. Despite the importance of virtual goods, few platforms beyond the leaders have stepped up. Thus, Android and Apple may well dominate into the future.”

 

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