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Global Smartphone Application Report 2010 (Update: 1st Half Year 2010)

  • ID: 1207607
  • Report
  • August 2010
  • Region: Global
  • 272 Pages
  • Research2Guidance
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Released on 20th of August 2010 "Global Smartphone Application Report 2010 (Update: 1st Half Year 2010)" focuses on how companies can successfully engage in and profit from this newly-established customer channel. It includes relevant app store and market size figures as of June 2010. The report covers three key market dimensions that every app publisher must understand in order to flourish:

A. Market Opportunity - How significant is the business opportunity rendered by this new customer channel? The report explores the current market hype, analyzes key trends, sizes the current market and its development, and projects market growth through 2013. It provides all the information necessary for companies to evaluate the current opportunities in smartphone application publishing.

B. Publisher Best Practices - What are the key benchmarks for developing and marketing successful apps? More than 100 companies shared their views, experience and insights for this report. Leverage best practices from these successful “early movers” when developing your smartphone application strategy.

C. App Store Decision - Which app stores offer the best opportunities for application publishers? The report explains the current app store landscape thoroughly, including a detailed description of 35 major app stores. The in-depth “App Store Ranking” groups stores according to the specific benefits they offer app publishers.
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1 Preface

2 Summary

3 Objectives and Scope of the Report
3.1 Participating Companies
3.2 Scope of the Report

4 Market Background
4.1 Market Developments 2000-2010
4.2 Trend Analysis

5 Current Status of Corporate Mobile Applications within the Market
5.1 Industry Background of First Mover Publishers
5.2 Purpose of Applications
5.3 Application Pricing
5.4 Additional Observations

6 Market Insight: Successful “First Mover” Corporations
6.1 Current Corporate Publisher Activities and Objectives
6.2 Outcomes: Applications and More
6.3 The Successful Approach
6.4 Going Forward

7 Best Practices
7.1 Best Practice Elements 39)
7.2 Branding Applications
7.2.1 Absolut Vodka
7.2.2 BMW
7.2.3 Nike
7.3 Revenue generation
7.3.1 Financial Times
7.3.2 Navigon
7.3.3 The Weather Channel
7.4 Access to Core Products (Enable Transactions and Increase Reach)
7.4.1 Amazon
7.4.2 eBay
7.4.3 Pizza Hut
7.4.4 Facebook

8 Application Stores
8.1 Overview of Application Stores
8.1.1 Device Manufacturer Stores
8.1.2 Mobile OS Application Stores
8.1.3 MNO Application Stores
8.1.4 Full-Catalog Independent Application Stores
8.1.5 Niche Stores -
8.2 Application Store Market Key Metrics
8.2.1 Average Downloads per Application
8.2.2 Average Pricing
8.2.3 Application Store Attractiveness to Developers
8.2.4 Application Publishing Complexity
8.3 Application Store Ranking
8.3.1 Application Store Ranking by Reach
8.3.2 Application Store Ranking by Competition Level
8.3.3 Application Store Ranking by Monetization Opportunities
8.3.4 Application Store Ranking by Application Discoverability
8.3.5 Application Store Ranking by Manageability

9 Market Outlook 2010-2013
9.1 Forecast
9.2 Key Market Developments
9.2.1 Business Model Trends: Paid Downloads vs. Alternative Revenue Sources
9.2.2 Application Technology Trends: Native versus Web-based Applications
9.2.3 Platform Dominance: End-to-End vs. Horizontal Platforms
9.2.4 Smartphone Application Store Market Structure: Oligopoly vs. Competition
9.2.5 Content: Global Versus Regional/Local Applications

10 Guiding Principles for Smartphone Application Publishers
10.1 Application Strategy
10.2 Multi-Platform Strategy - )
10.3 Organizational Integration
11 About research2guidance
12 Appendix
12.1 Application Store Detailed Profiles
12.1.1 Mobile OS Application Stores
12.1.2 MNO Application Stores
12.1.3 Full Catalogue Application Stores
12.2 List of Figures
12.3 List of Tables

List of Figures
Figure 1: Scope of the Report
Figure 2: Number of Smartphone Applications 2007-2010
Figure 3: The Application Store Race
Figure 4: Number of Application Stores 2007 - 1st HY 2010
Figure 5: Number of Smartphones Launched since 2nd HY 2008 with Pre-installed or Downloadable Application Stores (2nd HY 2008 – 1st HY 2010)
Figure 6: Cumulative Number of Smart Devices Launched since 2nd HY 2008 by Platform 2008-2010
Figure 7: Average Application Price per Platform 2007-2009
Figure 8: Change in Average Paid Application Price per Platform during First Half of 2010
Figure 9: Share of Smartphone Applications Downloads per Store 1st HY 2010
Figure 10: Smartphone Application Market Size (2007-2009)
Figure 11: iPhone Shipments Before and After the App Store Launch (millions)
Figure 12: Industry Split of Application Publisher
Figure 13: Application Purposes
Figure 14: Physical vs. Virtual Products, by Application Purpose
Figure 15: Application Price Comparison - Company vs. Market Average
Figure 16: Survey Question: When Did You Publish Your First Application?
Figure 17: Survey Question: On Which Platforms Do You Publish Your Applications?
Figure 18: Survey Question: What Goals Do You Want to Achieve With Your Applications? ( )
Figure 19: Survey Question: To What Extent Did You Reach Your Application Goals (average)?
Figure 20: Survey Question; What Are the Biggest Obstacles to Success?
Figure 21: Survey Question: How Many Applications Have You Published?
Figure 22: Survey Questions: How Do You Price Your Applications?
Figure 23: Survey Question: How Many Times Was Your Most Successful Application Downloaded?
Figure 24: Survey Question: What is the Average Development Budget for Your Applications?
Figure 25: Survey Question: What is the Average Development Time for Your Application?
Figure 26: Survey Question: Which of the Following Marketing Channels do You Use and How Effective are They?
Figure 27: Survey Question: Which Activities Will You Concentrate on Over the Next 12 Months?
Figure 28: Survey Question: Which Platforms do You Plan to Engage in Over the Next Year (2010)?
Figure 29: Survey Question: What are the Biggest Challenges of a Multi-Market Strategy?
Figure 30: Survey Question: How Will Your Engagement Level Change Within the Next 12 Months?
Figure 31: Learnings Cloud
Figure 32: Average Cumulated Application Downloads per Application Store and Application Number (1st HY 2010)
Figure 33: Average Price Level in Major Application Stores (1st HY 2010)
Figure 34: Pricing Differences for a Single Application (Games)
Figure 35: Application Stores’ Ability to Attract Smartphone Applications (1st HY 2010)
Figure 36: Increase of Number of Applications during First Half of 2010
Figure 37: Application Store Download Performance (1st HY 2010)
Figure 38: Number of Applications vs. Capable Devices (1st HY 2010)
Figure 39: Global Customer Reach of Major Application Stores (1st HY 2010)
Figure 40: Publisher Revenue Share in Major Application Stores (1st HY 200)
Figure 41: Number of Shelf Spaces in Relation to Total Application Numbers in Major Application Stores (1st HY 2010)
Figure 42: Smartphone Application Market Size 2007-2013
Figure 43: Application Download Trends (Paid and Free) vs. Total Application Shoppers (Installed On-Device Store) 2007-2013
Figure 44: Application Price Development 2007-2013
Figure 45: Key Trends in the Smartphone Application Market (2010-2013)

List of Tables
Table 1: Pre- and Post Apple App Store Launch Application Market
Table 2: Overview of Application Stores (1st HY 2010)
Table 3: OEM Application Stores (Key Facts)
Table 4: OEM Application Stores (Key Figures) (1st HY 2010)
Table 5: Mobile OS Application Stores (Key Facts)
Table 6: Mobile OS Application Stores (Key Figures) (1st HY 2010)
Table 7: MNO Application Stores (Key Facts) (p
Table 8: MNO Application Stores (Key Figures) (1st HY 2010)
Table 9: Full-Catalogue Independent Stores (Key Facts)
Table 10: Full-Catalogue Independent Stores (Key Figures) (1st HY 2010)
Table 11: Independent Niche Stores
Table 12: Application Store Ranking by Competition Reach (Criteria)
Table 13: Application Store Ranking by Reach (1st HY 2010)
Table 14: Application Store Ranking by Competition Level (Criteria)
Table 15: Application Store Ranking by Competition Level (1st HY 2010)
Table 16: Application Store Ranking by Monetization Opportunities (Criteria)
Table 17: Application Store Ranking by Monetization Opportunities (1st HY 2010)
Table 18: Application Store Ranking by Discoverability (Criteria)
Table 19: Application Store Ranking by Discoverability (1st HY 2010)
Table 20: Application Store Ranking by Manageability (Criteria)
Table 21: Application Store Ranking by Manageability (1st HY 2010)
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With the launch of the Apple App Store in mid-2008, Apple managed to reinvent the smartphone application market, creating an end to end solution (iPhone/iPod Touch/iPad, iTunes Store and applications) that dramatically improved the customer experience of application discovery, download and usage. Since 2007, the smartphone application market has grown annually by 302%, reaching a value of $XXX billion US (2009). Revenues for the first six months of 2010 amounted to $XX billion US, indicating that the market is still gaining momentum. However, the market is still in its early stages. The top five application stores represent XX% of the market’s downloads, with Apple alone responsible for XX% of the market. Average application prices have recently begun to align with those of the Apple App Store, and dropping by almost XX% in recent years -- from $XXX US (2007) to $XXUS (2009).

During first six months of 2010 the price erosion slowed down, reaching $XX US as the average price for a paid application. Independent applications stores like GetJar, Mobango, Handmark and Handango sold smartphone applications and other mobile content long before the App Store’s launch. These stores benefitted from Apple’s boost to the market with quickly growing download numbers. In 2009, independent stores held a market share of XX%, but are increasingly threatened by the large number of new application stores being opened by OEM, OS and MNO companies. In the middle of 2010 there were more than 40 major full-catalog application stores in the market, as well as hundreds of smaller or niche stores. With the broadening range of application stores, the development of a multi-platform strategy will become a must for corporate publishers. The selection process when assessing application stores’ appropriateness for a particular publisher can be effectively guided by a few key criteria: reach, competition level, available business models, discoverability options and service and submission quality. This report ranks 26 major application stores in detailed assessment according to these categories. This application store ranking highlights the various strengths of the stores and demonstrates that there are indeed other valuable distribution platforms for applications besides the Apple App Store.

On the publisher side, mobile specialists such as small “garage” developers and gaming companies have been the dominant players in recent years. With few exceptions, more traditional companies started their push into the application market in 2009. As part of this study, a survey of 82 of these “first mover” companies revealed that virtually all selected the Apple App Store as the publishing platform for their first application. For these applications, companies report using a step-by-step approach with limited development budgets (averaging $XX US) and quick time-to-market cycles (54% of participants released their applications in 1-3 months) in order to become familiar with this new customer channel. Based on the flurry of activity in the smartphone application market recently, best practices for large global companies looking to successfully enter this very competitive landscape have begun to emerge. Corporations are able to leverage the resource advantages they have over independent and “garage” developers. Besides successfully developing unique applications that effectively make use of smartphone features, these companies manage their existing marketing and service assets better than their competitors, allowing them to directly compete with the mass of mobile specialists. In the next four years the market will see dynamic growth. By the end of 2013, the smartphone application market will have grown annually by 75% to a value of $XX billion US. By that time the number of smartphone application consumers will have reached XXX million worldwide. Average application prices will continue to fall, though less drastically, reaching $XX US in 2013. Besides continued growth, there are five key trends that will shape the development of the smartphone application market in the next four years.

1. Business Model: The dominance of the pay-per-download business model will give way to alternative models such as in-app advertisement and application-triggered transactions.

2. Native Content: Installed applications will remain the dominant model on smartphone platforms. The time for widespread acceptance of web-based applications has still to come.

3. Platform Dominance: Today end–to-end platforms managed by Apple, RIM and others clearly dominate the smartphone application world. Currently, they represent XX% of the market. The dominance of this model will not begin to give way to other models until 2013 at the earliest.

4. Market Structure: Apple will most likely remain the market’s biggest applications store, but will lose some ground due to significant increases in competition. 5. Content: Smartphone applications will become more localized as the user bases in major countries reach critical mass. Mobile carriers, with their stronger localized presence, will attain more significant market shares in the future. Based on current market trends, the report concludes with a set of guiding principles application publishers can leverage over the coming year in order to publish successful smartphone applications.

These principles address the three main questions publishers must ask themselves when building and reassessing their mobile application strategy:
1. Application Strategy: How can I create smartphone application content that stands out against growing competition?
2. Multi-Platform Strategy: On which platforms and stores should I publish my applications?
3. Organizational Integration: How do I effectively organize my business to deal with the increasing importance and complexity of smartphone application development and publishing?
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- 3rd Space
- Abner David
- AccuWeather
- Amazon
- AndAppStore
- Android
- AndroidPIT
- Apple
- AT&T (MEdia Mall)
- Avis Budget
- Barnes & Noble
- BBC Focus Magazine
- BBVA Compass
- Best Buy
- BlackBerry
- Cellution
- China Mobile
- Clever Twist
- Comcast
- Coop
- Cydia
- Deutsche Bahn
- Deutsche Telekom
- Deutsche Welle
- eBay
- Eclaxy Software
- Eurosport
- Financial Times
- Flixster
- GazoPa
- Gelbeseiten Marketing
- GetJar
- GetJar
- Global Software
- Greenpeace
- Handmark
- Handster
- Ideas for iPhone
- Inside Mobile
- Kodak
- LG
- Magmic
- MeteoGroup
- Microsoft (Windows Marketplace)
- Mobango
- MobiHand
- neXva
- Nike
- Nikon
- Nokia
- O2
- Octane Technologies
- Oracle
- Palm
- Paragon Software
- Parliant
- PocketGear
- Preview Networks
- Proximity
- Qualcomm
- Rabobank
- Reebok
- Roadrunner Records
- RobinLabs
- Samsung
- Shadow Light Games
- Sony Ericcson
- Sprint
- Stolz
- StudiVZ
- T - Mobile
- The Weather Channel
- USA Today
- Verizon Wireless
- Virtual Nights Media
- Vodafone
- Wikimedia Foundation
- Zurich K1
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