Mobile apps, a growing business

By Rafael P. Martínez, Researcher

According to the latest ‘The App Date’ report, over 5 million Spanish people use mobile applications, and 15 million may afford so. The ‘apps’ business has suceeded as one of the most solvent ones despite the crisis, providing ample room for innovation and creativity. In fact, 1,400,000 apps are downloaded every day in our country, over 16 per second. This is not surprising, given that currently 44% of the population owns a smartphone.

Globally, figures are much bulkier. If in 2011 the app business generated around $8.5 billion worldwide, it is estimated that by 2016 that number will reach 46 billion. Apple already has a catalog of 500,000 apps in its App Store, and Google Play has attained a similar level. Just weeks ago Google announced 15 billion total downloads, which is approaching 25 billion downloads from the App Store. In both cases, several times the number of people on the planet. So every month, about 1.25 billion iOS and about 1 billion Android applications are downloaded. And we must not forget other platforms whose impact has gained momentum in recent months, as BlackBerry App World or Windows Phone Marketplace, as well as other app authoring initiatives based on HTML5 web technologies, like PhoneGap, with interesting interoperability benefits.

Business models vary substantially among platforms. The Apple model, which imposes tight control over published apps, contrasts with the Google model, more open, where free apps are almost a constant and quality filtering depends largely on end users. Monetization of free apps usually results from the insertion of advertising banners within the app itself (for example using AdMob technology), or by publishing complementary pay versions: a) ad-free version, b) professional version with advanced features, or c) ‘donate’ version for those who voluntarily do so if they think the app deserves it. This does not include indirect revenues that app technology can bring in strategic sectors such as mobile payments or e-commerce. As a reference, Google have paid out around $320 million to developers whilst Apple is already close to $4 billion.

In Gradiant we have accumulated experience in development and publication of mobile applications for different platforms and stores. Our aim is to develop specific solutions by helping companies to create and design apps according to their market  needs. We currently have projects on augmented reality, facial recognition or geolocation, among others. But the possibilities are virtually limitless and the future of apps looks very promising. Soon we will see them spreading across areas as diverse as health, commerce, home or the automotive sector.

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