Consumers worldwide will spend an estimated $156 billion in 2023, up from $85 billion in 2019, in aggregate within Apple's App Store and Google Play. About $96 billion of the revenue will go to the App Store and the remaining $60 billion to Google Play, according to data released this week.
Data from Sensor Tower, which helps app developers’ growth their audience in apps, estimates App Store and Google Play downloads will collectively generate $161 billion by 2023.
The market forecast for 2019-2023 is based on past download and revenue trends, macroeconomic projections, and other factors. The revenue estimates range from January 1, 2015 through December 31, 2018. The Android estimates represent revenue and downloads from Google Play, only, eliminating third-party sites.
In 2019, China will take the top spot to contribute most to App Store revenue, followed by the United States. Japan, Great Britain and Taiwan round out the top five countries. The U.S. is projected to pass Japan in 2019, becoming the top-earning country on Google Play. Japan had 43% year-over-year growth in 2018 to take the top spot. Japan, South Korea, German, and Taiwan follow to round out the top five.
Apple announced earlier this week that developers now can advertise their apps in App Store Search across an additional 46 countries. The company estimates that 70% of App Store visitors use search to find apps, 65% of downloads occur after a search in the store, and App Store ads average a conversion rate of about 50%, according to data from 2018.
The type of ads that generate the revenue for each of the two app stores are markedly different. The rise of subscriptions in the App Store will continue to drive revenue growth during the next five years. By 2023, 60% of App Store revenue will come from games, and the remaining 40% will come from apps, according to the data.
Entertainment apps in the App Store will contribute about 9%, while social networking will contribute 5%, music 3%, photos and video 3%, lifestyle 3%, and other 10%. By 2023, it is estimated games will take 60% and entertainment will take 12%.
Those percentages are significantly different from Google Play, while Apple will disburse the earning from most of its revenue, Google will focus mostly on gaming, at 85%, in 2019. All other categories are 3% or less. By 2023 the percentages will remain about the same, with gaming possibly taking another percentage point for a total of 86%.