Mobile apps revenues tipped to reach $26bn in 2013

The mobile apps market still has the feeling of a gold rush, with a few developers making their fortunes, and many more kicking their spades in frustration.

But how much gold is there to go round? Research firm Gartner has published its latest market forecasts, estimating that 103bn mobile apps will be downloaded in 2013: a 59.4% rise on last year's total.

Gartner predicts that global apps revenues will reach $26bn (£16.1bn) this year, up 44.4% on 2012's $18bn. Free (or freemium) apps are continuing to drive the market. The report suggests that 91% of downloads will be free this year, while in-app purchases will account for 17% of revenues

As ever, Gartner is also sticking its finger in the wind to predict future trends in the market, claiming that by 2017, annual app downloads will reach 268.7bn, by which point 94.5% of app downloads will be free, and in-app purchases will be generating 48% of revenues.

The report also predicts that apps will remain a Google and Apple game for the next few years. "iOS and Android app stores combined are forecast to account for 90 per cent of global downloads in 2017. These app stores are still increasingly active due to richer ecosystems and large and very active developer communities," said research director Brian Blau.

Gartner expects a slowdown in the number of apps being downloaded per device over this time though: from 6.2 average monthly downloads per Android device in 2013 to 5.8 in 2017, and from 4.9 to 3.9 for iOS in the same period.

"This relates back to the overall trend of users using the same apps more often rather than downloading new ones," said Blau. That's one reason for the expected growth in in-app purchases' share of overall app revenues.

"We believe that IAP is a promising and sustainable monetisation method because it encourages performance-based purchasing," he said. "That is, users only pay when they are happy with the experience, and developers have to work hard to earn the revenue through good design and performance."

How do Gartner's predictions compare with those of its rivals? The revenue predictions are similar to those published by ABI Research in June, which forecast $27bn of apps revenues this year, with two thirds of them expected to be generated on iOS.

However, the company recently published separate research claiming that Android apps will generate nearly $6.8bn in 2013, and that over the next 12 months Android apps will reach 65.9% of iOS app revenues.

Meanwhile, Juniper Research claimed in July that 80bn mobile apps will be downloaded in 2013, rising to 160bn by 2017 – so more cautious than Gartner's latest forecasts. Juniper agreed that only around 5% of apps will be paid by 2017, though.

In August, the company claimed that in 2017, "consumer apps" will generate $75bn of revenues, with just under a quarter of those revenues coming from paid apps, and the rest from advertising and in-app purchases.