About Futuresource Consulting

Futuresource Consulting, the specialist research and consulting company, is delighted to be the official knowledge partner for CEATEC JAPAN. The company can trace its roots back to the 1980s and provides market insights into consumer electronics, digital imaging, entertainment media, broadcast, optical manufacturing, storage media, professional IT and education technology.
With more than 70 full-time employees providing in-depth analysis and forecasts across consumer and professional electronics categories, Futuresource is able to advise on market, competitive and technological developments, providing clients with access to the information that helps produce the best possible results.


Mobile Apps on track to reach $16bn global retail value by 2015

The mobile apps market has evolved significantly over the last two years, helping improve the range and quality of content available to consumers on their mobile phones, as well as providing opportunities for a whole range of industry segments to reach out to their target audiences and realise new revenue streams, according to a new market report from Futuresource Consulting.

In 2011, the global apps market almost doubled in terms of consumer spend, reaching a total of nearly $4.5 billion. Growth in the number of downloads was even more aggressive, at close to 130%, reflecting the growing availability of free apps. As consumers continue to buy smartphones at an accelerated pace across the globe, the growth of the apps market will continue: at the end of 2011, there were 874 million smartphones in use, up from 576 million in 2010. As a further opportunity, tablets are growing at a much greater rate, but ownership still remains significantly behind that of smartphones.

Apple continues to drive the market, accounting for nearly half of the total number of apps downloads last year, though this share is being eroded by the success of Android. The market for apps is expected to reach 74 billion unit downloads by 2015, equivalent to a retail value of $16 billion. Once users establish a core library of apps, which include their favourites and most used, buy rates are expected to decline.

As of March 2012, there were an estimated 1.2 million apps available across all platforms and the focus among the majority of the industry is now on monetisation, either through the paid-for model, using in-apps purchases or from advertising revenues. All three of these business models continue to evolve and for a number of apps publishers, paid-for apps are the only option, mainly due to the significant investment in development and content. Many publishers are also working with short term price promotions, switching from one price point to a lower one to generate increased levels of interest and to try and drive an app into the 'most downloaded' chart, where it will get more visibility and hence even more downloads.

For many companies and brands, apps have become an important marketing tool and a key platform extension for their websites and online services. Moving forward through 2012, it is expected that we will see an emergence of professional enterprise-based apps in addition to apps targeted at the consumer.

Advertisers continue to focus their attention on the Apple and Android platforms, due to the sheer scale of the user base. At the end of 2011 there were over 500 million Apple and Android devices in use. In terms of consumer spend, games remains the dominant genre, accounting for approximately 50% of consumer spend, with established games publishers continuing to extend their franchises to apps and specialist publishers seeking to create the next 'Angry Birds' franchise.

Moving forward, tablets are already become the next big opportunity for games publishers, but as is the case across the games industry, development costs need to be managed as low pricing is common compared to traditional packaged gaming, meaning margins for many titles are low.