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The Future of App Stores

There are now millions of mobile applications running on the popular mobile operating systems. Mobile applications are distributed via app stores which provide directory and search services that assist users in identify and acquiring the apps they most desire.

This report provides a summary of the status of app stores in the market today. It presents a number of features common to all app stores. The major apps stores are then described by one of three groupings: 1) consumer, 2) enterprise and 3) independent. The business model for app stores is presented including upfront payment, in-app purchase and on-going subscriptions. The changing world of app revenue is summarized, indicating revenue started ‘all up front’, however, it is migrating to mostly in-app to give people time to see if the application meets their needs.

This report also evaluates the dynamics of apps on individual smartphone devices and provides evidence that the number of mobile apps downloaded is increasing, however, the number of active apps is leveling off at forty (40). A major section of the report defines the implications for enterprise mobility, and another section deals with the trend that mobile apps are free to download but are not necessarily free to use. The report ends with a vision for the future that indicates how app stores will proliferate for the next few years but then will go through a ‘shake out’ period in which only one or two app stores will survive for each mobile operating platform.

Target Audience:

  • Application developers
  • Mobile network operators
  • Mobile handset manufacturers
  • Network infrastructure providers
  • Mobile application store providers
  • Application and content aggregators


General Methodology

Mind Commerce Publishing's research methodology encompasses input from a wide variety of sources.

We rely heavily upon our Subject Matter Experts (SME) in terms of their market knowledge, unique perspective, and vision. We utilize SME industry contacts as well as previous customers and participants in our market surveys and interactive interviews.

In addition, we rely upon our extensive internal database, which contains modeling, qualitative analysis, and quantitative data. We review secondary sources and compare to our primary sources to update previous findings (for prior version reports) and/or compile baseline information for technology and market modeling.

We share preliminary models with industry contacts (select previous clients, experts, and thought leaders) to verify the veracity of initial modeling. Prior to final report production (analysis, findings, and conclusions), we engage in an internal review with internal SMEs as well as cross-expertise, senior staff members to challenge results.

We believe that forecasts should be prepared as part of an integrated process which involves both quantitative as well as qualitative factors. We follow the following 3-step process for forecasting.

Forecasting Methodology

Step 1 - Forecasts Input: The inputs for the present and historical revenues are derived from industry players. Financial and other quantitative data for individual sub-market categories are derived from original research and tested with interviews with major industry constituents.

Step 2 - Forecasting of Future Years: Mind Commerce extends forecasts based on a variety of factors including demand drivers as well as supply side data. Key success factors and assumptions are considered.

Step 3 - Validation of Data: The final step is to validate projections, which is accomplished in consultation with both internal and external industry experts, including both topic and regional experts. Adjustments are made to the forecasts based on factors identified throughout this process.


Executive Summary
Introduction
App Store Features
Storefront
Download
Catalog
Categories
Search
Analytics
In-App Purchase & Subscriptions
Billings & Payments
Cloud Services
Business Models
Freemium
Upfront Purchase
In-App Purchase
Wholesale
Subscription
Mobile App Store Players
Consumer Market
Amazon App Store for Android
Apple Apps Store
AT&T Apps Store
BlackBerry App World
Google Play
Microsoft Windows Phone Store
Facebook Apps Center
Enterprise Market
Antenna
Apps Central
App47
Apperian
Sybase
Independent Market
1Mobile
Amazon Apps Store
Appitalism
Estore by Ericsson
Fiksu
Getjar
Handango
Handmark
Handseter
Mobango
Opera Mobile Store
PocketGear
SlideME
Soc.io Mall
Discovery
Value Added Services
Amazon Kindle Fire
Apple iCloud
Barnes & Noble Nook
Google Nexus 7
Microsoft
Sony
Apps Revenue
Apps per Device Forecast
What this Means to Enterprise IT
Mobile is Now Primary
Face the Reality: Consumer & Enterprise Support is Here to Stay
Assess the Situation
Set Policies for the Consumer Space
Set Policies for the Enterprise Space
Consider Mobile Support for Customers
Educate Your Users and Get their Support
Develop a Realistic Plan
Consider an Integrated Mobile Management (IMM) system
Review your Mobile Strategy Annually
Why “Free” is a Misnomer in Mobile Apps
The Future of Apps Stores
Figures & Tables
Figure 1. Six of the largest and most successful app stores
Figure 2. Cumulative downloads of apps from the Apple Apps Store (in millions)
Figure 3. Sample Apple Apps Store Categories
Figure 4. Example of the Apple Apps store results for the Productivity category (displayed in iTunes)
Figure 5. Sample page from Handmark’s web site showing apps for multiple platforms including Android & BlackBerry (but not Apple)
Figure 6. Enterprises have to consider both the Consumer Area as well as the Enterprise Area in the deployment of their mobile applications
Figure 7. Enterprise IT now has both internal and external responsibilities
Figure 8. New Category: Integrated Mobile Management (IMM)

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