App Revenue To Hit $27 Billion In 2013

The mobile app market globally will grow 85% to $27 billion this year as apps remain a key factor in the battle among mobile platforms. Apple and Android will continue to dominate, with BlackBerry and Microsoft’s Windows Phone still far behind in the apps race.

Apple’s iOS alone will account for two-thirds of revenue from smartphone and tablet apps this year, according to a new forecast from London-based ABI Research. 

“Although Google’s Android OS recently surpassed Apple in terms of total app numbers, iOS users continue to prove they’re more willing to depart with their cash. The revenue gap between the two leading OSes looks unlikely to close over the next 18 months,” said ABI senior analyst Josh Flood.

At its developer conference earlier this month, Apple said its App Store now hosts 900,000 titles, of which 375,000 are specifically geared to the iPad. The company also announced crossing 50 billion total downloads and paying out $10 billion to third-party developers to date. App analytics firm Distimo estimated the App Store brought in $5.1 million a day in April compared to $1.1 million for the Google PlayStore for Android apps.

When it comes to devices, smartphones have generated the vast majority of apps. But the ABI report suggests tablets are gaining ground -- expected to account for 36% this year, and surpass smartphone app revenue by 2017. Tablet users are more inclined to pay for apps than smartphone owners because of the larger screen size and better experience for gaming and reading.

A separate forecast from Gartner on Monday projected that worldwide tablet sales will surge 68% to 202 million units this year, while the more mature market for mobile phones will increase by just 4.3% to 1.8 billion devices. By next year, tablet shipments will hit 276 million.

When it comes to revenue types, direct sales of apps will continue to drive the bulk of revenue.

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