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J’son & Partners Consulting presents main results of the research: “The development of Android & iOS ecosystems, operator’s and non-operator’s mobile content.”

 

The development of ecosystems (Android & iOS) on the mobile content market

Apple launched its first product based on the widely popular nowadays operating system – iOS on the mobile content market in 2008. Ecosystem iOS was aimed on a solvent audience and as a result was very interesting for developers. In the same very year, Apple Apps Store was launched in 62 countries all over the world. The number of available for download apps nowadays reached 1000 000 and downloaded number of apps – 50 bln.apps.

 

Later Google presented its smartphone G1 on Android operation system, developed together with T-mobile operator. As opposed to Apple, Google used the following approach – any manufacturer of equipment can use Android (operation system) on their devices. As a result, manufacturers were able to provide less pricey devices based on Android that were extremely necessary for users.

Statistics show the following trend nowadays: Google Play Market wins vs Apple Apps Store by number of provided mobile apps and loses by the total number of downloads.

 

Sales of mobile apps in Russia

J’son & Partners Consulting expects that the total market volume of mobile apps is around 246 mln.USD in Russia – 1% of the global sales of mobile apps in 2013.

 

The average number of installed apps on smartphones in Russia for the last 3 years grown 1,5 times.

 

 

Nowadays in Russia the following trend is presenting: 23 mobile apps are installed (by users of mobile Internet on smartphones), where 9 apps had been used at least once for the last month and 4 apps had been bought in an app shop.

 

 

J’son & Partners Consulting estimates smartphones sales in Russia as 17 mln. at the end of 2013, 41% growth in comparison with 2012.

 

Smartphones’ and Tablet PC’s users are main consumers of non-operator’s services and goods.

The increase in number of smartphones’ users is a key factor for competition on the mobile content market and as a result operators could loose revenues from traditional VAS-services¹


¹ VAS-services (Value Added Services) – additional services of cellular connection

 

Russian market of operator’s mobile content

Mobile operators are in the process of developing the additional services in Russia and in the world totally, as the market of voice data transfer is reaching its peak.

 

Operators are trasnforming their key business directions and try to gain from TV and music content, apps and mobile adds. Cellular operators are trying to motivate the customers to use VAS-services (private and corporate users).

 

According to J’son & Partners Consulting, operator’s mobile content market will reach around 63 bln.RUB at the end of 2013 (music and RBT-services will take half of it).

 

 

The competition between operator’s and non-operator’s content platforms results in a decrease of operator’s content sales. J’son & Partners Consulting explains it by the following factors:

 

       Standartization of operator’s VAS offers

 

Current situation on operator’s VAS market – presence of standard, long no changes service offers that are not very actual for a growing needs of users

 

       Increasing number of smartphones and Tablet PCs users

 

From one point it helps to increase the total revenues from the content services, on the other hand cellular operator becomes no longer a monopolist on the mobile content market. Multi-functional device gives a subscriber much more options.

 

       High level of piracy and fraud

 

Cooperation of operators and Ecosystems (Android & iOS) on the mobile content market

Same as operators, Android & iOS ecosystems have pros (receiving the revenues from mobile content market) and cons (that decrease potential sums of revenues)

 

According to J’son & Partners Consulting main pros and cons are:

 

 

J’son & Partners Consulting assumes that currently cooperation might be very profitable for operators and ecosystems in relation to mobile content. Vivid examples of such cooperation:

 

       Purchasing apps in Google Play via mobile payment – Beeline cellular network
       MTS & Google Play agreed to launch a package of business apps of Google Apps in a corporate MTS segment

 

Main advantages for operators of the cooperation with ecosystems are:

 

       An opportunity to sale their own apps and services in Google Play Market & Apple Apps Store, increasing the customer loyalty
       To be a broker in the chain of payment for mobile apps Google Play Market & Apple Apps Store
       To announce and promote operator’s news and offers via mobile apps purchased by subscribers of other operators

 

Forecasts

Global market of mobile apps

Mobile apps market has a very positive dynamics and shows great potential for further growth of its players – Android & iOS

According to Gartner estimations, around 269 bln. apps will be downloaded in 2017 and the revenues will reach 76.5 bln. USD.

 

 

Russian market of mobile apps

J'son & Partners Consulting forecasts Russian mobile apps market volume about 8 bln. Rub at the end of 2013 and the growth till 38 bln. RUB in 2016.

 

As a result the Russian share in the global mobile apps sales will reach 2%.

Russian market of operator’s mobile content

J'son & Partners Consulting awaits the operator’s mobile content market will reach 77 bln.RUB in 2016. The “Mobile TV & video” segment most likely will have the highest growth rates.

 

 

Detailed results of the research are presented in the full version of the Report: “The development of Android & iOS ecosystems as a threat for Russian cellular operators, key “fighting” methods, 2010 – 2016).”
(178 p)

 

1. Resume
2. Introduction
3. Mobile ecosystems (ANDROID & IOS) on content services market
       3.1. Android Ecosystem
              3.1.1. Evolution history of Android ecosystem
              3.1.2. Main pros and cons of Android OS
       3.2. iOS Ecosystem
              3.2.1. Evolution history of iOS ecosystem
              3.2.2. Main pros and cons of iOS OS
       3.3. Ways of monetization of Apple & Google mobile apps
       3.4. Google Play Market, Apple Apps Store revenues
4. Cellular operators on content services market
       4.1. Operators’ abilities in the provision of VAS services
              4.1.1. Experience and main advantages of the largest global operators in providing VAS
                        services
              4.1.2. Operation of cellular operators in Russia, in connection to the VAS services
       4.2. Cellular operators’ revenues (Vimpelcom, Megafon, MTS) from VAS services
       4.3. The comparison of global and Russian cellular operators in provision of content services
       4.4. Reasons for VAS services development by operators
              4.4.1. Influence on the financial indices of operators (ARPU), diversification, in order to
                        gain more profit
              4.4.2. Influence on the demand, increasing awareness of customers about the operators’
                        services
              4.4.3. Influence on the customer loyalty, increasing level of customer service
5. Operators and ecosystems (Android & iOS) cooperation on the mobile content market
       5.1. Main pros and cons of Android & iOS ecosystems on the mobile content market
       5.2. Main pros and cons of cellular operators on the mobile content market
       5.3. Competition between cellular operators vs Android & iOS ecosystems
              5.3.1. Android & iOS ecosystems vs cellular operators on the content services market
              5.3.2. Key “fighting” methods
       5.4. Cooperation of Android & iOS ecosystems and mobile operators
              5.4.1. Terms of cooperation
              5.4.2. Opportunities for operators in terms of such cooperation
              5.4.3. Opportunities for apps shops in terms of such cooperation
6. Development of mobile content market in Russia, main tendencies and forecasts, 2010-2016
       6.1. Android & iOS revenues forecasts, 2010-2016
       6.2. Revenues from content services of cellular operators in Russia, 2010-2016
7. Key conclusions
8. Annexes

 

List of Figures

Fig. 1. Number of available mobile apps in Google Play Market, Apple Apps Store, mln., 2008-2013
Fig. 2. Number of downloaded mobile apps in Google Play Market, Apple Apps Store, bln., 2010-2013
Fig. 3. Volume of the global mobile apps market, bln.USD, 2011-2017
Fig. 4. The volume of the global mobile apps market, bln.apps, 2012-2017
Fig. 5. Revenues of mobile apps shops in the world by model, bln.USD, 2011 – 2017
Fig. 6. Apple Apps store & Google Play Market shares of total revenues of these shops, 18 countries researched, November 2012 – April 2013
Fig. 7. VAS market structure in Russia, 2Q 2013, %
Fig. 8. Development forecast of VAS market in Russia from 2012 till 2016, bln. RUB
Fig. 9. VAS market structure in Russia, bln.RUB, 2012-2016 
Fig. 10. Ecosystems’ revenues, mln.USD, Russia, 2010 – 2016
Fig. 11. Cellular operators’ revenues from mobile content and other VAS services (excl. SMS and data transfer), bln.RUB, Russia, 2012 – 2016
Fig. 12. Number of available mobile apps in Google Play Market, mln., 2009-2013
Fig. 13. Number of downloaded apps in Google Play Market, Apple Apps Store, bln., 2010-2013
Fig. 14. Number of downloaded apps in Apple Apps Store, mln., 2008-2013
Fig. 15. Number of downloaded mobile apps in Apple Apps Store, bln., 2008-2013
Fig. 16. Classical scheme of mobile apps distribution
Fig. 17. New scheme of apps distribution
Fig. 18. Cooperation model: developer – apps shop – user
Fig. 19. Share of free and paid apps in the total downloads of apps shops in the world, % 2011-2017
Fig. 20. Number of downloaded paid apps in the world, bln., 2011-2017
Fig. 21. Range of apps in the use by the price in Apple Apps Store, April 2010- April 2013
Fig. 22. Average price of mobile apps (evaluated by number of monthly users), end of April 2013, Google Play Market, App Store
Fig. 23. Shares purchases by types (inside the app)
Fig. 24. Revenue share of monetization model: “In Apps Purchases (IAP)” in Apple Apps Store for iPhone, USA, January 2012 – February 2013
Fig. 25. Revenue by monetization model: IAP, Premium (paid apps) in Apple Apps Store for iPhone, February 2013, USA
Fig. 26. Total revenue from the total number of downloads in the Apple Apps Store for iPhone, USA
Fig. 27. Total revenue from the total number of downloads in the Apple Apps Store for iPad, USA
Fig. 28. Content app BookShelf type
Fig. 29. Content app NewsStand type
Fig. 30. An example of Inn app subscribption
Fig. 31. An example of app brand use - «Angry Birds»
Fig. 32. The popularity of monetization models of apps
Fig. 33. Mobile devices industry KPIs, 2009-2012
Fig. 34. Revenue share from mobile apps and mobile devices, 2012-2016
Fig. 35. Share of developers (%) that use mobile platform (excl.developers of apps for PCs) (n=2327, weighted)
Fig. 36. Share of developers (%) that use mobile platform (excl.developers of apps for PCs) (n=2327, weighted)
Fig. 37. The correlation of number of the chosen platforms for development and revenue per 1 app (excl. those who are not interested in revenue) n=1693, weighted)
Fig. 38. Share of developers (%) who ranged each platform by a certain feature among those who are oriented on iOS & Android (n=1200)
Fig. 39. Share of developers (%) who use each platform as main platform (n=1200)
Fig. 40. The distribution of revenue by platform, share (%) developers (n=2534)
Fig. 41. Shares of Apple Apps store & Google Play Market of the total revenues of these shops, 18 countries researched, Novermber 2012 – April 2013
Fig. 42. Share of Apple Apps store & Google Play Market of the total revenue of these shops, March 2013 – August 2013
Fig. 43. 34 Counties analyzed by generated revenue of apps shops, 2Q 2013
Fig. 44. Index revenue (top 100 apps) by apps shops, 2Q 2013
Fig. 45. Volume of the global apps market, bln. USD, 2011-2017
Fig. 46. Volume of the global apps market, bln. Apps, 2012-2017
Fig. 47. Number of mobile apps downloads, bln.apps, 2011-2017
Fig. 48. Dynamics of the global mobile VAS market (bln.USD) 2011-2016
Fig. 49. Global market of mobile internet access, 2011-2016
Fig. 50. Market structure of the global mobile VAS (bln. USD) in 2009-2016
Fig. 51. Comparison of revenues from mobile content services and mobile apps paid via OTT services (bln.USD) in 2009-2016
Fig. 52. Share of revenues from non voice services by countries, 2011-2012
Fig. 53. Pre-installed apps on a branded devices from Verizon, 2013
Fig. 54. Yandex.Shell app on smartphone by Megafon SP-A20i Mint
Fig. 55. Scheme of roles distribution in the process of providing RBT services
Fig. 56. Megafon. Trava.ru / mobile version
Fig. 57. Market sructure of VAS in Russia, 2Q 2013, %
Fig. 58. VAS market development forecast in Russia, 2012 – 2016, bln.RUB
Fig. 59. VAS market structure in Russia, bln.RUB, 2012-2016
Fig. 60. Mobile content market structure in Russia, bln. RUB, 2009-2012
Fig. 61. VAS share in the revenue structure of the cellular operators in Russia, 2012-2016, %
Fig. 62. The dependence of operators’ positions on the content services market from the number of post-paid subscribers and penetration level of iOS, 2012, %
Fig. 63. Revenues of ecosystems, bln. USD, Russia, 2010 – 2016
Fig. 64. Cellular operators’ revenues from mobile content and other VAS services (excl.SMS and data transfer), bln.RUB, Russia, 2012 – 2016

 

List of Tables

Table 1. History of Android ecosystem
Table 2. History of Google Play Market
Table 3. History of iOS ecosystem
Table 4. Apple Apps Store history
Table 5. «20 largest cellular operators in the world, end of 2012 (by revenues volume from mobile content)»
Table 6. 5 largest cellular operators in the world, end of 2012
Table 7. Vodafone’s company profile
Table 8. Telefonica’s company profile
Table 9. Orange’s company profile
Table 10. Airtel’s company profile
Table 11. American Movil’s company profile
Table 12. AT&T’s company profile
Table 13. Verizon’s company profile
Table 14. Solutions for provision the mobile TV services

 

 

 

This Information Note is Prepared by J’son & Partners Consulting, We strive to provide factual and prognostic data that fully reflect the situation and are available to us before issuing the material. J’son & Partners Consulting reserves the right to revise the data after publication of new official information by the market players.