In mid-2013, I wrote (in Japanese) about the unhealthy dependency of Google Play revenue growth on Asia.
In fact, Japan revenue is so strong that AppAnnie released a report with the title “Japan Spotlight: Hey Big Spender! Japan Outspends US, Continues Its Meteoric Growth”. In this report, AppAnnie tells us that Japanese Google Play revenues are disproportionately high (twice normal levels in comparison to iOS);
In the last year, Google Play app revenue has caught up with iOS in Japan, compared to the rest of the world where iOS app revenue is well over double that of Google Play on an aggregate basis.
From these data points, I predicted the following;
- If DoCoMo started selling the iPhone, then worldwide Google Play revenue would stagnate and maybe even start decreasing.
- At the time when the above data points were taken, DoCoMo sold only Android smartphones and no iPhones. Since DoCoMo is Japan’s largest carrier, the vast majority of Android devices in Japan were sold to DoCoMo subscribers. Many of these people actually preferred an iPhone, but were bound to DoCoMo because of the breadth of their network.
- If DoCoMo started selling iPhones, it was obvious that the market share of Android in Japan would decrease for 24-months (the duration of a contract).
- A decrease in Android market share would mean that Google Play revenue from Japan would stagnate or decrease. Since Japan is Google Play’s largest market by far, this would significantly impact Google Play sales worldwide.
We may be starting to see this happening.
On January 8th, 2014, Distimo released an analysis of December 2013. In that report, they mentioned the following (bold styles added by me);
The month of December, including the holiday business, led to a revenue growth of 18 percent for the combined revenue from the Apple App Store and Google Play compared to November. Relative to July 2013, the combined revenue grew by 38 percent. Looking at the app store level, both graphs show a clearly steeper slope. This increase translates into a growth in revenue of 17 percent for Google Play and an even stronger 18 percent for the Apple App Store from November to December 2013.
Although it is irrational to draw conclusions from a single month’s worth of data, if we see this trend continuing, then yes, we might be seeing the effects of my prediction. Ideally, we would also like to see market growth broken down by country, data which AppAnnie may soon provide.