Mobile app revenue to grow 2.2 times to $79 bn in 2020

mobile app revenue
Mobile app revenue will grow by 2.2 times over the next five years — to $79 billion in 2020 from $36 billion in 2015.

Analyst firm Ovum says the growth of mobile app revenue will be 1.8 times more as compared with the number of app downloads – from 211 billion in 2015 to 378 billion in 2020.

“Downloads will see a slowdown in mature smartphone markets as they approach saturation and as user acquisition costs escalate, placing a greater emphasis on download quality rather than quantity,” said Guillermo Escofet, principal analyst in Ovum’s Digital Media team.

“Revenue, on the other hand, will continue on a higher growth trajectory as people spend more time on apps and as in-app spending intensifies,” said Escofet.

Growth in global average revenue per download will tail off by the end of the forecast period, as late adopters and emerging markets become ever greater contributors to the global pie.

Emerging markets will register the steepest growth rate over the next five years in both downloads and revenue – twice as steep as developed markets in the case of the latter. Yet developed markets will continue to capture the largest share of revenue.

Downloads, on the other hand, will continue to be dominated by emerging markets. Also, emerging markets’ share of both downloads and revenue will increase.

China accounts for the largest share by far of app installs throughout the forecast period from 2013 to 2020 thanks to its gaming industry. It currently accounts for over half of installs. The bulk of this is driven by its huge Android independent app store sector.