BBM Now Rumoured To Be Hitting the App Store On April 26th -- Negative, Says RIM

In the Mac Rumors forum there's, obviously, a new rumour that has been passing around. Apparently, in the Toronto event today, RIM's co-CEO, Jim Balsillie, mentioned that BBM "and 'services'" would be available on the iPhone App Store on April 26th. Of course, there's no way to confirm this but I hope it hits Android on the same day - which isn't looking too likely right now. Of course, the BBM for other platforms will just be a stripped down version so it might be a legitimate threat to other messaging services.

Update: BGR has contacted RIM and they mentioned that the rumour is false. RIM reportedly didn't even hold a conference in Toronto so it's absolutely made up.

[Mobile Syrup]

How Big a Threat Do App Stores Pose to Search?

"The App Store is replacing the web search engine for mobile device users, at least for some searches," argues Dan Frommer, Senior Staff Writer of Business Insider. The long-term issue is just how much search volume (and therefore ad revenue) might be at risk.

Apps are good for some content, such as games, camera apps, productivity software and utilities, for example. Lots of people might also argue apps are suitable replacements for traditional websites, though many users with smartphones and decent browsers might simply say they prefer access to the "full" version, not the mobile-optimized apps, which remind some users of the older WAP-style, text-heavy experiences. That is mostly going to be a matter of end user preferences.

There might also be a developing difference between iPhone and Android users. Many iPhone users might not realize they can save bookmarks that essentially provide "app" functionality. Many Android users probably figure out pretty quickly they can do so, and can simply substitute an icon that is a "bookmark" for an icon that represents an "app."

The point is that some subset of searches on mobile devices is going to be different than search on desktop computers, which puts Google's core search business at a bit of risk. The example Frommer points to is users going to the App Store looking for a shortcut to "Facebook," when they could use a browser, go to Facebook and then simply create a bookmark.

But there are other ways to make search a lot easier on a touchscreen device. Voice-activated search is one of those alternatives.

The choices likely will be most relevant for popular web sites, games and other content experiences. Apps will be viable there, but it is somewhat hard to see general search functions being substantially replaced by apps.

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Chrome Web Store Will Feature Games

The new Google-sponsored Chrome Web Store will feature games, at least initially.

More than 50 percent of applications are priced below or equal to $2.00 in all stores, with the exception of BlackBerry App World and Windows Marketplace for Mobile, says Distimo.

The average price of all paid applications and the 100 most popular paid applications in the Apple App Store for iPad ($4.65) is higher than in the Apple App Store for iPhone ($4.01).

Google Android Market has the largest share of free applications (57 percent) and Windows Marketplace for Mobile has the smallest (22 percent).

Mobile Games Explain Much About Mobile App Disuse

You probably have seen statistics indicating that a typical mobile app gets used for perhaps a month, and then usage declines dramatically over the following two months. One reason is that so many mobile apps are either pieces of content or gaming apps, and will lose their novelty over time.

After looking at about 40,000 game titles, O'Reilly Radar estimates a popular game app, on average (median), spends about 15 days on the "Top 100" list.

Popular iPhone games stay highly-ranked only for a few weeks - O'Reilly Radar

81% of App Store Downloads are "Free"

Piper Jaffray analyst Gene Munster estimates that 81 percent of downloads from Apple's App Store are free.

His analysis of the Top 50 paid apps reveals that their average selling price is $1.49. Munster estimates that on average, Apple receives $0.29 for every app that's downloaded from its store.

Munster calculates that this means $428 million for Apple based on its 70-30 revenue-share split. Munster estimates that the App Store is generating more than 16.6 million app downloads a day, compared to 8.9 million song downloads from the iTunes Store.

81% of App Store downloads are free, claims analyst | Mobile Entertainment News

GetJar Raises $11 Million

Fast-growing mobile app store GetJar, which says it has had more than one billion apps downloaded from its store to date, making it second in size only to Apple’s app store, has raised $11 million in a second round of funding.

GetJar’s app store includes about 70,000 apps for all of the major mobile operating systems, including Apple’s, although CEO Ilja Laurs tells us that most of the company’s growth is coming from “open” platforms where there is less of an “established and convenient place” to get apps.

He says the company, which he calls the “Wal-Mart for mobile apps,” will invest much of the new cash in building up its presence on the Android platform.

GetJar, The ‘Wal-Mart For Mobile Apps,’ Raises $11 Million | paidContent

Mobile App Store Downloads 7X Bigger by 2014

Mobile app store downloads will increase by a factor of seven between 2009 and 2014, according to Pyramid Research. In 2010 Pyramid Research projects that 36 percent of paid apps will be downloaded through app stores and 86 percent of free downloads will take place through them.

App stores have become an important element in the mobile value chain in part because a wide range of easily accessible apps has quickly become a prerequisite for handset and platform vendors. Vendors also gain a new revenue stream, a powerful customer loyalty tool, an important gateway to additional revenue streams and an attractive resource for potential operator partnerships.

Advertising revenue is expected to play a big role in allowing developers to create revenue streams from free apps.

Developers will be the biggest winners, not only as they gain a higher portion of revenue but also because competition among stores will greatly improve support, payment terms and transparency.

Most third-party stores and aggregators will lose out over time to vendor and operator-sponsored stores, though Getjar might be the salient example of an exception to the rule.

iPhone Ecosystem Drives Itself

Some new analysis by Chitika Research suggests a reason why the Apple ecosystem is so powerful: it has a base of customers that are highly motivated to buy other Apple products they don't yet own. Or at least one would infer from an analysis of search terms entered by iPhone, BlackBerry, Palm, Android, and iPad users.


The reason that Apple is so tough to compete with is that it has a fanatically loyal fan base, builds lots of producs on a single OS, is a single provider of hardware with a standard approach with products across a broad range of prices, from cheap iPods without screens up to Mac Pros that will break your budget.

Then it has the  iTunes and the App store that are becoming a hub for everything digital, including e-books and apps.

Search Study: iPhone Users Want New, Palm Users Want Out – Chitika Research

21 Billion Mobile App Store Downloads in 2013

Mobile application downloads will  reach four billion in 2010, rising to 21 billion by 2013, says Gartner. Those downloads will be driven by worldwide smartphone shipments surpassing 390 million by 2013, growing at a rate of 20.9 percent per year.

According to Gartner consumers will spend $6.2 billion in mobile app stores during 2010, about 20 percent of all apps downloaded. There will also be $600 million dollars worth of advertising revenues generated by those downloads.

Gartner forecasts the total download revenue will increase to nearly $30 billion by 2013. The number of free or
ad-funded apps will increase to 87 percent by 2013. There also will be an increase of business models where the download is free, but there are additional charges associated with use of the applications.

In some cases users will have free access for a period, to be followed by purchase. In other cases users can use the free version, with limited functionality, but can get access to full functionality by upgrading for a fee.

Subscription services, or charging for content within an application are other revenue models. Some apps might also charge for access to new levels or areas within the application.

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Web Browser Preferred Over Content Apps On The iPad

"I've tried a few content apps on the iPad, including the much discussed Wired app. But I don't like reading content via apps on the iPad and I gravitate to the Safari browser," says Fred Wilson, Union Square Ventures partner.

Among the reasons: the apps treat pages as monolithic objects so users cannot cut and paste text, follow links to other content apps, keep multiple pages open, use a common interface, or connect with social media.

Content apps do not allow use of search functions and cannot be aggreated using apps such as techmeme.

I Prefer The Web Browser Over Content Apps On The iPad:

Channel Conflict Develops in Mobile App Store Ecosystem

Channel conflict is an almost-inevitable by-product of complex ecosystems. A recent survey suggests channel conflict already is rising in the mobile application store ecosystem. A survey of 400 developers by Evans Data Corp. recently found that 80 percent of developers in North America think they should receive more than 70 percent of the revenue generated by their apps in an app store.

Of course, when Google launched its Android Market, the company pointed out that  "developers will get 70 percent of the revenue from each purchase; the remaining amount goes to carriers and billing settlement fees."

"Google does not take a percentage," the company said. "We believe this revenue model creates a fair and positive experience for users, developers, and carriers." But what is fair from Google's point of view might not be viewed the same way by developers or carriers.

That's channel conflict.

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Apps or Mobile Web? It is Going to be a Toss Up

Today most mobile applications for smartphones are downloaded from “app stores.” According to ABI Research data, in 2009 consumers downloaded some 2.4 billion applications from such stores, and the download rate will accelerate over the next few years until in 2013 smartphone downloads are expected to peak at just below seven billion.

So you might be wondering whether this implies a decline of interest in mobile apps. Not really. What the forecast implies is that there will be other ways to get and use applications, namely using a mobile Web browser.

After 2013, smartphone download rates from app stores will start a slow decline, although total downloads from all sources will probably continue to grow, ABI Research believes.

ABI argues that more and more people will start visiting mobile websites authored using HTML5, which will mean applications can be run natively from inside Web pages where today external apps might be required.

Moreover, handset makers and service providers will pre-install apps on their products, such as social networking apps and some mobile office suites, removing the need for downloading those kinds of applications.

“App stores aren’t going away," says ABI Research Senior Analyst Mark Beccue."Following the 2013 peak in demand, the number of downloads in 2015 will have decreased only seven or eight percent."

But users will be able to gain the value of apps using their browsers.

Also, it is conceivable that mobile network operators will host their own app stores. Many observers think such efforts will enjoy only modest success, but there is one notable area where huge success could be possible.

If operators concentrate on providing downloadable apps to feature phones, that could be a big factor in newer and developing markets where smartphone penetration is lower.

Developer Interest now is a 2-Horse Race: Apple and Android

Apple and Android are at the top of developer interest as development platforms, an Appcelerator poll of 1,028 developers suggests.

In fact, developer interest largely is a two-horse race between Apple and Google. The  "true game changing news" is Android, Appcelerator says. In fact, sentiment has swung fairly quickly towards Android as the clear "second choice" for developers, after Apple.

In January 2010, 86 percent of developers were interested in iPhone and 68 percent were interested in Android, an 18 point spread. That spread has closed to just six points now (iPhone 88 percent, Android 82 percent).

About 80 percent of developers say they are interested in developing for the iPad.

Developers indicated they were most interested in developing eBooks, entertainment/media applications, business applications, medical applications, and education applications.

Even App Store "Marketing" Apps Must be Marketed

Despite the hype about mobile apps, it remains difficult to "monetize" them, for several reasons. Most apps sell for low prices, so a developer needs huge volume. But volume means getting noticed, and simply creating an app and listing in on an app store does not guarantee attention.

That increasingly means a successful app not only has to provide value, but has to be promoted. And that means all the traditional thinking about traditional marketing still holds. Developers have to take affirmative steps to promote their apps; they won't sell themselves.

"The App Store is not a marketing vehicle; it is a distribution vehicle," said Raven Zachary, president of digital creative firm Small Society.

Of course, not all apps are sold. Some are themselves marketing vehicles. But an iPhone app can cost $50,000 or more for an agency to develop. So even the marketing vehicle must be marketed.

Operator App Stores Get More Traction Than You Might Think

Though many observers, including many service provider executives, might be skeptical about the long-term viability of operator-sponsored mobile application stores, a new study by Nielsen suggests consumers are favorably impressed with operator app stores, as compared to handset stores such as the Apple App Store.

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Many observers believe device app stores will ultimately gain favor, but a new Nielsen survey finds ongoing loyalty to carrier stores.  As of the end of 2009, half of all applications users were accessing carrier app stores according to Nielsen’s new App Playbook service.

That is not to say the Apple App Store has lost any luster in the United States. The relatively new BlackBerry App World Store also was the second most popular app store, in part because of BlackBerry’s industry-leading installed base.

But carrier application stores were not as far behind as some might think. About 84 percent of respondents said they were satisfied with the Apple App Store, while 81 percent said they were happy with the Android Market.

Some 59 percent of respondents said they were satisfied with the BlackBerry App World. About 56 percent reported satisfaction with the Windows Marketplace.

Most mobile carrier stores compare favorably with BlackBerry. About 64 percent of respondents were satisified witht he AT&T Application Store, while 65 percent said they were satisfied with the Sprint Application Store.

Some 66 percent said they were happy with the T-Mobile Application Store and 62 percent reported they were satisfied with the Verizon Application Store.

Nielsen’s App Playbook  surveys more than 4,000 application downloaders in the United States every six months about their mobile application usage.

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$17.5 Mobile App Sales in 2012

Mobile App Stores: A Closer Look from Plugg Conference on Vimeo.

A study conducted by mobile analyst Chetan Sharma and sponsored by GetJar suggests the market for paid mobile apps should grow to $17.5 billion within the next three years, implying a value greater than CD-based apps in 2012, when apps sold on physical media are projected to be $13.8 billion.

App downloads will leap from slightly more than seven billion in 2009 to nearly 50 billion in 2012, representing an annual growth rate of 92 percent, the study also suggests.

According to the study, by 2012, off-deck paid-for apps will be the biggest revenue generator, accounting for almost 50 per cent of all apps revenue.

In 2009, on-deck apps available from mobile operators accounted for over 60 percent of all apps revenue, but this will fall significantly to just under 23 percent by 2012.

The average app selling price for apps in North America was $1.09, significantly higher compared to that in developing markets such as South America ($0.20) and Asia ($0.10).

According to the study, revenue opportunities in Europe are set to grow from $1.5 billion in 2009 to $8.5 billion in 2012, while in North America the figure will rise from around $2.1 billion to around $6.7 billion in 2012.

Currently, apps are most popular in Asia, with the region accounting for 37 percent of global downloads (free and paid) in 2009. North American downloaders spend the most money on apps, accounting for over 50 percent of global app revenue.

Advertising and transactions are a growing portion of the way applications are monetized, though purchase fees will represent most of the revenue for the near term.

Books Lead Apple App Store Inventory

There are lots of applications available in the Apple App Store. But a huge number of those items are discrete book or game titles, not applications. And those most applications downloaded from the App Store are of the "free" sort, about 75 percent of the books and games are "for fee" downloads.

In fact, "books" are the biggest category in the store, followed by games.

The App Store is an awful lot like iTunes, it appears: a distribution mechanism for content.

What Does iTunes and App Store Behavior Indicate?

About 75 percent of iTunes digital music buyers are 25 or older, says Forester Research analyst Mark Mulligan. I admit I haven't been paying any attention to the demographics of iTunes downloaders, so that comes as a surprise to me.

Apple iPhone app "for fee" downloads, on the other hand, seem to be growing at a faster rate than iTunes songs did. I haven't seen age demographics on iPhone downloads, but it stands to reason that users 25 and older are the dominant iPhone demographic. In 2008 and 2009 it appears that about 30 percent of iPhone buyers were younger than 25.

What might all that mean? Mulligan argues that music products are not as interesting to buyers as applications are. He also argues that music is not as important to buyers under 25 as it seems to be among users older than 25.

The implication there is that iTunes and music downloads have not quite caught on with younger users as one might casually assume is the case. One might note that music purchases might be more common among users with higher disposable income, which would skew to older demographics.

One might argue that music is just as important to younger users as older users, but that sideloading or illegal downloads are the dominant acquisition method.

Mulligan's observation is that the music industry still has not found a way to increase the attractiveness of its product among the upcoming generations of consumers.

I'm not entirely convinced that conclusion is completely warranted. It might be the case that downloads are driven by users 25 and older, just as music downloads seem to be.

On the other hand, one has to note that gaming applications are arguably more popular with iPod "touch" users, use of which definitely skews to the teen market segment. I'm not sure how downloading of paid apps stacks up in that demographic.

One might argue that what iTunes and the App Store have shown is a clear value for users as a means of content and application distribution channel, irrespective of age. So far, "free" apps seem to constitute 85 to 90 percent of all downloads from the App Store.

App Stores Very Valuable for Handset Suppliers and Users; Maybe Not Developers

App stores have been a huge boost to smartphone perceived value. What they haven't yet proven is that they are an effective way for software developers to sell applications.

About 80 percent to 90 percent of app downloads are of the "free" rather than "paid" variety, according to AdMob.