Can you imagine living without apps? While the answer to this would most probably be a “no” from the majority, a new study by Sensor Tower has predicted that the ad spending will go up to $270 billion by the year 2025 and this figure does include paid downloads, in-app purchases, and subscriptions.
Furthermore, the market researchers have also estimated that the in-app spending will return to the level of pre-pandemic, which means that there will be a stable growth in the next few years, downloads will go up but the biggest surprise will emerge in the form of app store spending in non-game apps beating mobile game spending by at least 2024.
Looking at how consumers crazily spend almost twice on mobile games as compared to on non-games, this, for now, seems to be a very impossible claim. But the firm is hopeful because of the sudden shift that mobile apps are expected to make towards the subscription model. So, in figures, by the end of the year 2024, the non-app game spending might raise up to $86 billion whereas game spending will only reach $73 billion according to the estimates. The lead is expected to only grow in 2025 as non-games will have an app spending of $107 billion whereas mobile games will see a little growth and stand at $78 billion.
The reason behind this prediction can be the global consumer spending of 2020 - which was up by 34% for the top 100 subscription apps on a year-over-year basis.
There is also one factor that Sensor Tower hasn’t accounted for in their prediction and that is of how the regulatory environment will come into play across the app stores in the upcoming years. In the current, scenarios, companies like Apple and Google force apps to charge from customers for subscriptions through their own payment processes. But if the new anti-competition laws work out, publishers would then enjoy the liberty of marketing their own subscriptions within the apps and let users rely on their own channels to make purchases.
Hence, if this change is taken care of, then we can already see its massive impact on the app store subscription growth trends, along with the forecasts.
Despite the pandemic pushing in-app spending up by 30% on year-over-year to a record $111 billion in 2020, the gross revenue across both of the app stores will only increase by 19.5% compound annual growth rate (CAGR) to make up to $270 billion by 2025. Breaking down that figure further, $185 billion will belong to the App Store spending and $85 billion would be for Google Play.
Quite ironically, the U.S will see slow growth as compared to other parts of the world (a CAGR of 17.7% to reach $74 billion by 2025).
It is the European markets that will be the cause of major growth in the in-app store spending till 2025 and the list of countries is going to be led by the U.K. These markets haven’t been predicted based on the most spending in total, but in fact, keeping in mind where the real growth will take place. Therefore by 2025, 11 European countries will cross the $1 billion in consumer spending to also together make up as $42 billion in consumer spending.
Downloads, on the other hand, will continue to grow with similar trends to reach 230 billion by 2025, and Google Play will have the major contribution to that figure (187 billion global downloads to be precise).
The report concluded with the figures of U.S App Store downloads in 2025 which are going to be 10.6 billion and Google Play will make 6.3 billion among it.
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Furthermore, the market researchers have also estimated that the in-app spending will return to the level of pre-pandemic, which means that there will be a stable growth in the next few years, downloads will go up but the biggest surprise will emerge in the form of app store spending in non-game apps beating mobile game spending by at least 2024.
Looking at how consumers crazily spend almost twice on mobile games as compared to on non-games, this, for now, seems to be a very impossible claim. But the firm is hopeful because of the sudden shift that mobile apps are expected to make towards the subscription model. So, in figures, by the end of the year 2024, the non-app game spending might raise up to $86 billion whereas game spending will only reach $73 billion according to the estimates. The lead is expected to only grow in 2025 as non-games will have an app spending of $107 billion whereas mobile games will see a little growth and stand at $78 billion.
The reason behind this prediction can be the global consumer spending of 2020 - which was up by 34% for the top 100 subscription apps on a year-over-year basis.
There is also one factor that Sensor Tower hasn’t accounted for in their prediction and that is of how the regulatory environment will come into play across the app stores in the upcoming years. In the current, scenarios, companies like Apple and Google force apps to charge from customers for subscriptions through their own payment processes. But if the new anti-competition laws work out, publishers would then enjoy the liberty of marketing their own subscriptions within the apps and let users rely on their own channels to make purchases.
Hence, if this change is taken care of, then we can already see its massive impact on the app store subscription growth trends, along with the forecasts.
Despite the pandemic pushing in-app spending up by 30% on year-over-year to a record $111 billion in 2020, the gross revenue across both of the app stores will only increase by 19.5% compound annual growth rate (CAGR) to make up to $270 billion by 2025. Breaking down that figure further, $185 billion will belong to the App Store spending and $85 billion would be for Google Play.
Quite ironically, the U.S will see slow growth as compared to other parts of the world (a CAGR of 17.7% to reach $74 billion by 2025).
It is the European markets that will be the cause of major growth in the in-app store spending till 2025 and the list of countries is going to be led by the U.K. These markets haven’t been predicted based on the most spending in total, but in fact, keeping in mind where the real growth will take place. Therefore by 2025, 11 European countries will cross the $1 billion in consumer spending to also together make up as $42 billion in consumer spending.
Downloads, on the other hand, will continue to grow with similar trends to reach 230 billion by 2025, and Google Play will have the major contribution to that figure (187 billion global downloads to be precise).
The report concluded with the figures of U.S App Store downloads in 2025 which are going to be 10.6 billion and Google Play will make 6.3 billion among it.
