By Anu Passary | Sep 12, 2012 12:11 PM EDT
A recent study conducted by Gartner, Inc. shows that free apps will account for nearly 89 percent of total mobile app downloads in 2012. The research firm also predicted that global mobile app store downloads for 2012 will exceed 45.6 billion. Free and paid downloads, Gartner estimates, will be 40.1 billion and 5 billion, respectively.
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"In terms of the apps that consumers are buying, 90 percent of the paid-for downloads cost less than $3 each," said Sandy Shen, research director at Gartner. "Similar to free apps, lower-priced apps will drive the majority of downloads. Apps between 99 cents and $2.99 will account for 87.5 percent of paid-for downloads in 2012, and 96 percent by 2016."
Apple's App Store has been a prominent market player and source for apps, accounting for close to 25 percent of "available apps in all stores." Gartner expects that Apple, with its massive market share, will have more than 21 billion downloads, a 74 percent increase over 2011 figures. The growth in download figures is indicative of mobile app content's popularity and the trend augurs well for the future.
"The number of apps available is driven by an increasing number of stores in the market today that include platform owners, device vendors, communication service providers (CSPs) and others who want to offer core mobile app services. These stores will see their combined share of total downloads increase, but demand for apps overall will still be dominated by Apple, Google and Microsoft," said Brian Blau, research director at Gartner.
Gartner analyst Sandy Shen sees Amazon as an important market player and sees the e-retailer becoming a strong future contender.
"Amazon has appealed to users with its strong brand, global presence and a good selection of high-quality content while Facebook's recently launched App Center - supporting both mobile devices and desktops - will become a powerful competitor due to its strong brand and leading position in social networking and gaming," said Shen.
Additionally, even though the market trend indicates a leaning towards free and budget-friendly apps, the in-app purchases are expected to drive downloads and app store revenue. Gartner estimates that in-app purchase will drive 41 percent of store revenues in 2016, up from 10 percent (in 2011). Moreover, the in-app purchase downloads will increase from 5 percent (in 2011) to 30 percent in 2016.
"App stores should support in-app purchases as soon as possible as this offers a new path of monetization, and helps to attract developers as they attempt to extend an app's momentum by providing easy access to upgraded services and functionality," noted Brian Blau.
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