05 Jun

The App Economy Revolution

Orct-BlogThe App Economy Revolution

The number of unique mobile phone users around the world has passed 50% of the world’s total population. The usage figures – provided by GSMA Intelligence – suggest that 100 million more people started using a mobile device from April 2014. To put those figures in context, that’s more than 750,000 new mobile users every day – or 9 new users every second.

In this scenario, one hears of the words “App Economy” frequently. So what does it connote?

App economy relates to all the economic activity which is performed on mobile applications. From the very early days since they made their debut, mobile apps of various kinds changed the face of business as it were and catapulted entrepreneurs onto the high road of success. App economy in general covers an entire gamut right from the sale of apps, generation of ad revenue and of course a slew of public relations opportunities that are created by the tons of free apps around. Coupled with this, the many hardware devices on which these apps have been designed to perform are also having a field day.

By taking advantage of major transitions in apps and platforms, lining your business up with the new value chain, and getting into the API business and doing it well, you’ll see unprecedented levels of reach, new channels of revenue, while at the same time doing a better job of maintaining your people, time, and costs.

It might be surprising to learn that a few years ago―in 2007 to be precise―mobile phone apps were next to nil. That lean phase of virtual nothingness changed during the grand peak period of 2011 when in excess of 25 billion apps were downloaded by mobile phone users. This overwhelming consumer behavior, in terms of downloading apps, has in many ways dictated the fortunes of leaders in the cell phone industry. Android and Apple Inc. are the prime examples of companies that recognized the changes quickly and hence rode the wave of success by gaining a sizeable chunk of market share. 52% of developers that target mobile devices such as tablets and smartphones are using HTML5 technologies for developing. Android remains the top platform with 71% and iOS follows at 56%.

Apps are most certainly creating a positive and vibrant effect for a host of online businesses that are primarily accessed via mobile-based apps, instead of the Internet. This has spurred traditional websites that earned their revenue through online ads to give a serious thought about app adoption to enhance their existing business models.

The mobile “app economy” is undoubtedly the fastest growing segment in the entire cell phone value chain, and application development is the key factor. The trend has shown no signs of stopping which is why analysts across the spectrum opine that this growth rate will continue to ascend. Proof of this can be found in a new forecast out from APPNATION that states the app economy will push to at least $151 billion by 2017, that is nearly double what the economy hit in 2012.

Industry observers say that over the next four years app based commerce will show substantial increases from in-app advertising, virtual goods and app downloads. Email, social networks, and mobile enabled browsers are also expected to push more revenue.