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November 20, 2012

Smartphone and tablet app downloads to generate $57bn by 2017: report

The number of paid apps will decline by 2017; with free apps comprising more than 91% of the total downloads

By CBR Staff Writer

The number of smartphone and tablet app downloads is expected to reach more than 350 billion between 2008 and 2017, with paid downloads generating $57bn globally, according to a report.

According to the Strategy Analytics App Ecosystem Opportunities (AEO) forecast – Mobile Apps Download Forecast: 2008 – 2017, 45% of the phone downloads will be from Google Play while 56% of the tablet downloads will be from Apple by 2017.

The number of paid apps will decline by 2017; with free apps comprising more than 91% of the total downloads.

Strategy Analytics Apps Research director Josh Martin said paid downloads remain an essential component of the app ecosystem.

"Paid downloads will remain an important way for smaller developers to monetize their efforts," Martin said.

With the number of fee app downloads growing, the average selling cost of download apps is expected to drop to 8 cents in next five years.

The report forecasts that with the decline in revenue and increase in app store maintenance costs – including app approval personnel, marketing, and other maintenance costs – the app stores may be forced to look other revenue models.

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"For developers committed to paid downloads transitioning to tablets may be the smartest way to preserve the business model over the long term. App Stores will also see a revenue crunch as more revenue is earned from advertising – revenue generated outside the bounds of the app store – and will need to prepare.

"Newer platforms such as Windows 8, BlackBerry 10, Tizen and Firefox are building their operating systems and storefronts with this knowledge which should go a long way to making them attractive to developers and end users."

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