• by Jack Loechner , Staff Writer @mp_research, January 25, 2010

According to a new Gartner report, "Application Stores; The Revenue Opportunity Beyond the Hype," consumers will spend $6.2 billion in 2010 in mobile application stores while advertising revenue is expected to generate $0.6 billion worldwide. Analysts said mobile application stores will exceed 4.5 billion downloads in 2010, eight out of ten of which will be free to end users.

Gartner forecasts worldwide downloads in mobile application stores to surpass 21.6 billion by 2013. Free downloads will account for 82% of all downloads in 2010, and will account for 87% of downloads in 2013.
Stephanie Baghdassarian, research director at Gartner, says "As... application stores become the focus for players in the value chain, consumers will experiment with application downloads... games remain the No. 1 application, and mobile shopping, social networking, utilities and productivity tools continue to grow... "

Mobile Application Stores' Downloads and Revenue, Worldwide
	2009	2010	2013
Downloads (in M)	2,516	4,507	21,646
Total revenue (in $M)	$4,237.80	$6,770.40	$29,479.30
Source: Gartner, December 2009

Worldwide mobile application stores' download revenue exceeded $4.2 billion in 2009 and will grow to $29.5 billion by the end of 2013. This revenue forecast includes end-user spending on paid-for applications and advertising-sponsored free applications. Advertising-sponsored mobile applications will generate almost 25% of mobile application stores revenue by 2013.
High-end smartphone users today tend to be early adopters, more trustful of billing mechanisms, and will pay for applications that meet their needs. Average smartphone users will be less tech-savvy and will be more reluctant to pay for applications.
Ms Baghdassarian added, "Growth in smartphone sales will not necessarily mean that consumers will spend more money, but it will widen the addressable market for an offering that will be advertising-funded..."
Read the complete release here, or obtain the full report from Gartner here.