How big is the world market for apps?

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Surprise: lets start with Apple. Estimates vary about how much in dollars of apps have been purchased via the app store. I read somewhere that Apple sold $300m in the first year of operation of the app store. And I read somewhere else that Apple is now selling $200m of apps per month.

Looking next at device Market share in a say for example a basket of countries in Western Europe the market share by brand may look something like this:

Nokia                           22%

Samsung                     20%

Sony Ericsson             19%

Other Java phones     15%

Blackberry                  12%

Apple                           10%

Win Mob,  and rest      2%

If you say that Apple managed sales of $300 apps with just 10% of the device market share then it follows that if the other manufacturers managed to launch successful app stores and sold roughly the same amount of apps there would be a market for $300m x 10 = $3B per annum.

Peak Apps = $3B per annum?

3 Reasons why this figure is too high.

  1. It does not necessarily follow that simply because people buy apps on the apple app store that they will do so using other devices on other App Stores. Other app stores existed long before Apple started theirs but no one (except Apple) noticed. App sales before Apple were small.
  2. Everyone might get bored and stop buying apps. You may have seen reports stating that the average customer uses an App for about 1 minute. (How did they figure that out?)
  3. A technological advance may occur that wipes out the App economy.

3 Reasons why this figure is too low

  1. Apple don’t sell in India or China. If they did the figure could mushroom.
  2. The calculation is based on the relatively low reported sales in Apple first year of App sales (July 08 July 09). A more realistic start point might be current reported monthly sales multiplied by 12.
  3. The Internet of Things! It could be that the App store is an early prototype for selling apps for your fridge, cooker, heating system, chair in a world driven by the Internet of Things. Is it a phone, is it a computer, is it a camera, is it a pair of glasses, is it a fridge, is it a lamp? No! Its the internet of things! Could there be an App for that?