App store revenues worldwide to reach $85 billion in 2020 – non-gaming apps set to double

Global app store revenues are expected to reach $85 billion in 2020, up from $56.4 billion, according to the latest Global Mobile Market Report from Newzoo. This growth is driven by an increasing number of smartphone users, from 2.6 billion in 2017 to 3.6 billion by 2020.

The report revealed that Samsung continues to be a global market share leader at 31% and 859 million active smartphones, followed by Apple (25%). Apple however ranks as the leading tablet brand with a market share of 64% or 166 million active devices. Together, Apple and Samsung account for around 90% of the global tablet market, which leaves little room for competitors. China is the largest smartphone market with 875 million smartphones active in 2016.

Thijs Hagoort, CFO of Newzoo, says that the rise in smartphone penetration will boost a demand for mobile consumer insights.

“For many consumer-facing brands, having insight into the number of smartphone users and number of devices actively in use, the specs of those devices, related consumer profiles, and how devices are used in general is far more relevant than defining the market in terms of units shipped, which is a rather narrow supply-side definition of the market.”

China also leads in terms of smartphone usage in 2017 with 717 million consumers actively using their smartphones. India, the US, Brazil and Russia are among the world’s largest smartphone markets in terms of consumer usage. Qatar, UAE, Bahrain and Kuwait have some of the world’s highest smartphone penetrations.

Asia Pacific regions, the Middle East and Africa are leading the growth in global app store revenues. Mature markets such as Europe and the US are likely to stabilise. Whilst most of the growth in apps is led by gaming apps, non-gaming categories are set to reach revenues of $10.2 billion in 2017 and double to $20 billion in 2020.

Asia Pacific will account for $31.8 billion or 56% of app store revenues this year.

Hagoort concludes:

“Innovation in areas such as mini apps, streaming, AR, and mobile payments will have a significant impact on the mobile economy. We also expect alternative app distribution methods and channels, such as independent third-party app stores and direct downloads, to become more important in the coming years, especially in the Android market. That is why we aim to provide a global overview across all territories, beyond just apps downloads and revenues.”