App Annie Shows iOS App Store Widening Revenue Lead Over Google Play

As I have been mentioning on this blog for quite a while now, despite the impressive growth rates that Google Play is showing in revenue growth, data suggests that the gap in absolute revenue between it and the iOS App Store is actually widening.

App Annie has been my source for data. However, since about a year ago, they have made it quite hard to directly observe the gap. Now, in a recent report, App Annie has provided the chart that clearly shows this trend.

This that chart;

App Annie Index 2014 Retrospective EN pdf 5 39ページ

We can clearly see that Google Play’s revenue growth rate has been quite impressive, but that is only because it was quite small in 2013. In absolute terms, the gap is clearly widening. Hence the current trajectory suggests that Google Play will not catch up with iOS in revenue.

Breaking down the revenue, we can see why.

  1. As App Annie has previously shown and as they show again in their most recent report, revenue growth of both the iOS App Store and Google Play comes almost entirely from three countries; Japan, South Korea and the United States. Revenue growth from developing countries, the countries where Android is typically very strong, is still almost negligible.
  2. In both Japan and the US, iPhone is increasing market share. Therefore it follows that iOS App Store revenue in these markets should be outpacing Google Play. With the iPhone 6 and 6 plus, it looks like this is starting to be the case in South Korea as well. Therefore, iOS App Store revenue in winning in the countries that matter.
  3. Android is continuing to gain market share in the developing countries and download numbers in these nations clearly show tremendous growth. This however has very little effect on absolute revenue because in these markets, customers simply do not pay much for apps.

What else would I like to know

Now that it is clear that Google Play revenue will not catch up with iOS App Store in the foreseeable future, the next topic related to the app ecosystem that I find interesting is the status of non-game apps.

App Annie has noted in their Q3 2014 report that “Games drive nearly all Google Play Revenue Growth”. This is deeply disturbing. It suggests that the non-game categories in Google Play are barely growing at all.

When we revel in how technology has improved out lives, we are seldom talking about games. We are talking about apps that help us and our children learn things, apps that improve our productivity and apps that help us communicate. If these apps are not growing, then it suggests that tech is not improving or lives, but is in fact an opium that enslaves us to spend money wasting our time.

It would be terrible if this were the case.