Despite a slowdown in mobile app installs, direct revenue continues to grow, says IDC

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Research from the International Data Corporation (IDC) has found that mobile device owners installed almost 156bn mobile apps globally last year, worth $34.2bn in non-advertising, direct revenue. According to the data, that’s set to reach 210bn installs and $57bn in revenue by 2020.

Despite slowdown in app downloads, market looks healthy

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Source: officialdeepakverma.wordpress.com

However, IDC says there may be a slowdown in app install volumes and direct revenue driven by a maturing market. Annual install rates are expected to fall. Mobile app install volume is predicted to show a five year CAGR of 6.3%. In contrast, direct revenue from mobile apps is set to slow down in terms of growth, but the five year CAGR remains within double digits at 10.6%.

58% of global direct app revenue last year was captured by Apple’s App Store ecosystem, which is an increase of 36% the year over. Apple’s share of global app install volume was just 15%, down 8% from the previous year.

Google meanwhile captured 60% in install volume. That’s due to the higher volume in Android devices. However, despite some good growth in downloads and direct revenue, Google Play revenue gains were a little smaller than the year before. Apple continues to perform slightly better.

John Jackson, Research Vice President, Mobile and Connected Platforms, IDC, says:

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“While they provide a convenient measure of the mobile app economy and its beneficiaries, we caution that preoccupation with download/install volumes and associated direct revenue may miss the thrust of changes in the mobile marketplace. Facebook and Google continue to dominate mobile ad spending thanks to the scale and sophistication of their network effects, with Facebook’s moves to incorporate news and other interests into its experience will likely pull traffic and install volumes away from discreet apps. Similarly, the emergence of ‘bots’, which seek to automate interactions in a contextually infused way, are another in a series of examples of value being created above the OS layer and even above the app.”