Mobile app stores will see annual downloads reach 102 billion in 2013, up from 64 billion in 2012, according to Gartner. Total revenue in 2013 will reach USD 26 billion, up from USD 18 billion. Free apps will account for 91 percent of total downloads in 2013, and Gartner expects in-app purchases (IAPs) will account for 48 percent of all store revenue by 2017, up from 11 percent. IAP purchases will drive 17 percent of the store revenue in 2013 and increase to 48 percent in 2017.
As with downloads, IAP is expected to have strong growth in 2013 and 2014 and slow in later years. This is due to smart devices reaching more mass-market consumers whose willingness and/or affordability to spend on IAPs is lower than early adopters. However, Gartner expects IAP to become a major monetisation method for app stores and developers. Research shows that IAP contributes to a significant amount of Apple's App Store revenue from iPhones worldwide. While other platforms have not reached the same levels as the iPhone, the analysts project they will also see IAP contributions increase in the future.
