In 2009 the market is dominated by the top five application stores, representing 96% of the market’s downloads, with Apple alone responsible for 77% of the all downloads, according to research2guidance. The launch of the Apple App Store in 2008 has started an app store race leading to 34 major application stores and hundreds of niche stores in 2009. The growing competition will lead to a decrease of Apple’s App Store market share below 30% in 2013.
The market for smartphone applications will grow to $15,6bn in 2013.
Although smartphone applications have been live since 2000, the race for market dominance truly began in 2009 after the success of Apple’s App Store launch. Independent full-catalog stores were the first to offer marketplaces for smartphone applications, but with new competition from OEM, OS and MNO stores, their market position weakened.
Independent stores fear to be squeezed in the middle, with OEM/OS and MNOs having better access to their app store customers providing on-deck store solution for all smartphones which are being sold until 2013.
“We can already see first signs of a consolidating market with the acquisition of Handango by GetJar“, explains Ralf-Gordon Jahns Research Director at research2guidance.
The rising competition will also affect Apple’s dominate market position. Apple will most likely still be the biggest market place in 2013 but will lose its dominant role.
“The winners in this race will be the players which manage to get their app stores pre-installed on the most smartphone devices and to attract the best app developers” says Egle Mikalajunaite research manager at research2guidance “Nokia, Blackberry, Samsung and Google will become the top challengers of the Apple App Store in the coming years”.
Niche stores will try to capitalize on targeting a specific customer segment. Today most niche stores are concentrating on a specific technology platform (e.g. Android, Palm, Blackberry, Symbian). In the future more and more niche stores will concentrate on a specific customer segment or application type (e.g. business apps, adult apps) or region.
“For any application publisher the app store race means a much broader choice of distribution platforms for their products” Mr. Jahns adds. “Multi-platform publishing will be the key challenge in 2010 and beyond. You have to know the pros and cons of each platform in order to make the right decision on where to publish an app.”
Additional information is available in the research2guidance report (research2guidance.com), “Global Smartphone Application Report 2010” and on the research2guidance website.