App Annie Index: Market Q1 2016 China Takes Japan’s #2 Spot for iOS Revenue
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App Annie Index: Market Q1 2016 - China Takes Japan’s #2 Spot for iOS Revenue
Table of Contents 1. The Technology Behind the Index 2. This Quarter’s Macro Trends ●
China Passes Japan in iOS Revenue
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Entertainment and Music App Revenue Skyrockets From Subscriptions
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Games Drive Download Growth in Vietnam, Argentina and Egypt, but Differ in the Markets They Address
3. Looking Ahead 4. Top Charts for Countries and Categories ●
Top Countries by Worldwide Market Share Growth in Downloads and Revenue
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Top Countries by Downloads and Revenue
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Top Categories by Worldwide Downloads and Revenue
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App Annie Index: Market Q1 2016 - China Takes Japan’s #2 Spot for iOS Revenue
1. The Technology Behind the Index The information contained in this report was compiled from App Annie Intelligence, the leading market data solution for the app economy. To see how our app store download, revenue, demographic and usage estimates can help guide your critical business decisions, take a tour or request a demo today.
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App Annie Index: Market Q1 2016 - China Takes Japan’s #2 Spot for iOS Revenue
2. Q1 2016’s Macro Trends China Passes Japan in iOS Revenue As China rings in a new year, it has disrupted the iOS leaderboard yet again — this time passing Japan to take the #2 spot for revenue. China’s quarterly iOS revenue grew nearly 2.2x year over year from Q1 2015 to Q1 2016. Atypical of past trends, as China’s install base has increased, the rate of revenue growth has actually accelerated year over year, up from 2x growth the year prior. China continued to see strong downloads after surpassing the US in Q1 2015 to become the largest market for iOS downloads. As predicted in our 2015 Retrospective, revenue followed the surge in downloads driven by in-app purchases to help China pass Japan. The revenue growth was driven almost entirely by games. Further, a majority of this growth was concentrated in a handful of core games including top-ranking F antasy
China’s iOS revenue grew 2.2x year over year, overtaking Japan as the #2 top-earning country.
Westward Journey, Westward Journey Online, Hero Moba
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App Annie Index: Market Q1 2016 - China Takes Japan’s #2 Spot for iOS Revenue
and The Legend of Mir 2. Typically a leading indicator in the market, games are often a strong signal of trends to
come. In this case, China passed Japan in both games and overall iOS revenue in the same quarter due to both countries’ high propensity for gaming. Surpassing Japan, China narrowed in on the US, currently ranked #1 in iOS game revenue. If China’s iOS game revenue continues to grow at these rates, it is set to pass the US in the coming quarters. However, the US still maintains a sizable 30% lead on China for total iOS App Store revenue due to the growth in monetization of non-gaming apps in the country. While the US experienced a stronger growth rate year over year in Q1 2016 than in Q1 2015, China is growing at an even faster rate. It would not be surprising for the US’s lead to continue to shrink as the Chinese app market expands.
In terms of revenue on iOS, China is closing in on the US for games, but the US maintains a 30% lead overall.
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App Annie Index: Market Q1 2016 - China Takes Japan’s #2 Spot for iOS Revenue
Entertainment and Music App Revenue Skyrockets From Subscriptions Led by iOS, Entertainment and Music apps experienced
boundaries with global demand ripe for the picking. This is
explosive year-over-year revenue growth in Q1 2016. This
evidenced by 34% of Netflix’s revenue c oming from
was largely due to the success of subscription revenue
outside the US at the close of 2015 and the rise of local
models catering to consumer demand for streaming
players in regional markets, which i s the case for video
services.
streaming services like T uluntulu in Africa.
Within Entertainment, video streaming apps comprise the bulk of this mammoth growth in global revenue. As mentioned in our January App Index, Netflix reached the #1 spot worldwide for video streaming apps on iOS after
introducing in-app subscriptions only four months prior. Revenue growth amongst the top five video streaming apps is mostly attributed to two countries: the US and China. In fact, two of the top five video streaming apps by worldwide iOS revenue, HBO NOW and H ulu, are only available in the US market. Conversely, revenue for iQIYI and Tencent
Video, which round out the top five, is driven almost entirely by the Chinese consumer base. Despite these heavyweight countries, video streaming transcends international
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App Annie Index: Market Q1 2016 - China Takes Japan’s #2 Spot for iOS Revenue
Akin to video, it is no surprise music streaming apps also experienced strong worldwide year-over-year growth on
Given S oundcloud’s announcement of its new subscription service, Soundcloud Pro; Apple Music’s production of a
both app stores in Q1 2016. Spotify held onto its #1 spot
docu-series in partnership with Vice; and S potify’s
for worldwide iOS revenue in Music. As mentioned in our
entrance into video streaming, it is clear the streaming
Music Streaming Report, it is not solely a large company’s
game is far from over and only getting larger.
game; there are also many local players catering to regional consumer demand and smaller services making a splash.
QQ Music and TIDAL are two such apps that experienced
large revenue growth in Q1 2016. QQ Music’s growth was
propelled by its loyal Chinese consumer base, maintaining its top rank by revenue in the country. TIDAL’s quarterly
success appears to be attributed more to artist exclusivity, rather than regional loyalty. Worldwide TIDAL d ownloads
spiked after Rihanna’s ANTI exclusive album release in late
January and reached an all-time high after Kanye West’s exclusive album release mid-quarter. Kanye’s album achieved more than 400 million streams on TIDAL and preceded the surge in revenue growth for the music
streaming platform. This partnership showcases the power high-demand artists can bring to a music streaming platform and offers the opportunity for strategic partnerships to drive growth in the future.
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App Annie Index: Market Q1 2016 - China Takes Japan’s #2 Spot for iOS Revenue
Games Drive Download Growth in Vietnam, Argentina and Egypt, but Differ in the Markets They Address As we identified earlier this year, emerging markets drove
a unique opportunity for publishers looking to
significant growth in both downloads and revenue from
strategically expand into a high-growth market. As
2013 to 2015. This growth continued into Q1 2016, with
mentioned in our Forecast, we expect worldwide app store
standout countries: Vietnam, Argentina and Egypt.
downloads to grow 33% to 147.3 billion in 2016, driven largely by smartphone adoption in emerging markets and
Vietnam experienced the fastest year-over-year
the need for developers to meet the unique regional
percentage growth in Google Play downloads from Q1
preferences. This is even more important for apps outside
2015. It also ranked second in market share growth,
of games as they become a cornerstone of growth in the
showing that Vietnam is a substantial mover in the app
app economy.
economy. Given its strong gaming culture, it is not surprising that games contributed half of the growth of Google Play downloads in the country. Resembling East Asia more than the rest of Southeast Asia, Vietnam has a strong appetite for local game publishers, with Z ingPlay ranking in the top 10 Google Play games by downloads in the country in Q1 2016. Further, 3 of the top 10 games by combined Google Play and iOS App Store revenue in Vietnam during Q1 2016 were from local publishers. The
local gaming culture offers
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App Annie Index: Market Q1 2016 - China Takes Japan’s #2 Spot for iOS Revenue
On the other side of the world, Argentina also experienced
respectively, demonstrating the local appetite for
high year-over-year growth in Google Play downloads,
creativity and photo-based communication apps such as
landing it in the top 10 for worldwide market share
B612, Snapchat and Instagram.
growth. As with Vietnam, games represent a strong portion of Argentina’s Q1 2016 download growth on
Egypt also saw high year-over-year growth in Google Play
Google Play. However, this growth was far less
downloads. Again, games were the drivers of growth.
concentrated in the Games category. Further, without a
Egypt’s top gaming charts experienced the most volatility
large culture of local game publishers in Argentina,
amongst the three markets with only five games
international games contributed the most to download
remaining from the Q1 2015 top Google Play downloads
growth. While this is also true for the majority of top
rankings. This could indicate that Egypt may be a readily
games by monthly active users in Q1 2016, Trivia Crack
receptive market for new and trending games. Conversely,
and Truco Free , are notably from Argentinian publishers.
Argentina proved the most stable to games over time with seven of the top games by Google Play downloads in Q1 2016 holding fast from the Q1 2015 top chart. Egypt offers a diverse market hungry for both Eastern and Western games and open to the newest and trendiest releases.
We expect worldwide app store downloads growth to be driven largely by smartphone adoption in After Games, Photography and Social apps experienced
emerging markets and the need for developers to
the second- and third-highest year-over-year growth,
meet the unique regional preferences.
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App Annie Index: Market Q1 2016 - China Takes Japan’s #2 Spot for iOS Revenue
3. Looking Ahead eSports: As identified in our Top App Predictions of 2016, the stage is set for large revenue growth in competitive mobile gaming events, also known as eSports. China’s rapid year-over-year revenue growth in Q1 2016 for core
in the Spotify app. As the top foodservice app by monthly active users across both Android Phone and iPhone,
Starbucks represents a market ripe for furthering S potify’s reach and increases the potential for monetizing the user
game categories (Action, Strategy, Adventure and
base. Strategic partnerships, integrations and A PI
Role-Playing Games or RPG), suggests massive revenue
launches are likely to continue as pathways for success
opportunities for eSports in the country. While China
among apps and bridges for the continual migration from
ranks beneath both Japan and the US in total iOS revenue
the physical to mobile world.
from core games, its skyrocketing growth rates prime it to be a country to watch in the eSports arena. App Integrations: Apps continue to permeate all facets of our lives, even branching into other apps. As apps expand their use cases, Integrations with other apps into major categories such as music streaming are becoming more prevalent. One such example was the introduction of
Spotify into the Starbucks app in Q1 2016. The integration allows users to discover music playing in-store, save
songs, influence future Starbucks playlists and play music
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App Annie Index: Market Q1 2016 - China Takes Japan’s #2 Spot for iOS Revenue
4. Top Charts for Countries and Categories Worldwide App Downloads and Revenue by Store
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App Annie Index: Market Q1 2016 - China Takes Japan’s #2 Spot for iOS Revenue
Top Countries by Worldwide Year-Over-Year Market Share Growth in Google Play Downloads, Q1 2016
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App Annie Index: Market Q1 2016 - China Takes Japan’s #2 Spot for iOS Revenue
Top Countries by Worldwide Year-Over-Year Market Share Growth in iOS App Store Downloads, Q1 2016
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App Annie Index: Market Q1 2016 - China Takes Japan’s #2 Spot for iOS Revenue
Top Countries by Worldwide Year-Over-Year Market Share Growth in Google Play Revenue, Q1 2016
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App Annie Index: Market Q1 2016 - China Takes Japan’s #2 Spot for iOS Revenue
Top Countries by Worldwide Year-Over-Year Market Share Growth in iOS App Store Revenue, Q1 2016
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App Annie Index: Market Q1 2016 - China Takes Japan’s #2 Spot for iOS Revenue
Top Countries by Downloads and Revenue
*Google Play downloads are small in China due to the prevalence of third-party Android app stores in the country. **China’s revenue figure is iOS only, as app store revenue cannot be generated through Google Play in China.
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App Annie Index: Market Q1 2016 - China Takes Japan’s #2 Spot for iOS Revenue
Top Categories by Worldwide Downloads and Revenue
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App Annie Index: Market Q1 2016 - China Takes Japan’s #2 Spot for iOS Revenue
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