The mobile app market’s $70 billion in 2015 is expected to grow about 270 percent to $189 billion by 2020. A new App Annie report also projects time in apps up 114 percent, with games taking 55 percent of total app-market revenue. Time in shopping and transport apps may triple.
“Publishers today are not only game studios and media companies,” the report notes, “but banks, retailers, airlines, ride-sharing services, even government agencies. To ride the app economy’s rise, publishers need to weigh market openings while they plan product, performance goals, international growth, and portfolio management.”
Revenue rises with time spent
By 2020 both in-app advertising and app-store revenue should each exceed the combined 2015 total for those lines. Both grow hard, but ads are expected to outpace stores, with ad share moving from 58 percent to 62 percent.
Two drivers stand out: time in apps roughly doubled in two years, and device counts keep climbing. Smartphones and tablets together may reach 6.2 billion by 2020.
Game makers will still take a large slice, but ads should lift non-game publishers too. Non-game revenue share may rise from 34 percent ($24B) to 45 percent ($85B) by 2020.
The US stays ahead
By late 2015 Asia Pacific had already passed the Americas on revenue, largely on China’s back. Asia may deliver more than $85 billion to developers by 2020. Mature US ad rates and higher CPMs, plus a strong store take, still point to the US as the top publisher market at about $59 billion, with China second near $54 billion.
