The Strategy Analytics App Ecosystem Opportunities (AEO) forecast – Mobile Apps Download Forecast: 2008 – 2017 – predicts that between 2008 and 2017 paid downloads will generate more than $57B globally. However, paid apps begin to decline as free apps come to represent more than 91 percent of all downloads by 2017.
As the percentage of free app downloads continues to grow, the average selling price of all downloaded apps (free and paid) will drop to just 8 cents for smartphone apps by 2017. The decline in revenue and increase in app store maintenance costs – including app approval personnel, marketing, and other maintenance costs – may force app stores to consider new revenue streams or higher revenue splits.
Josh Martin, Director of Apps Research, said in the press release, “Paid downloads remain an essential component of the app ecosystem. Paid downloads will remain an important way for smaller developers to monetize their efforts. 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.”
Source: Strategy Analytics
[Attribution: Biz Journals via TechCrunch. Thanks to MacDailyNews Reader “Dan K.” for the heads up.]