Are smartphone users buying more apps and paying more for them?

Taylor Martin
 from Concord, NC
Published: July 11, 2011

Applications could easily be regarded as the backbone of the smartphone world. Some will argue that applications only matter so much, but without them, smartphones would hardly have enough functionality to be considered “smart” in today's terms. They would only be glorified, high-end feature phones with large displays.

This means the smartphone industry relies on the well-being and success of the application market. When you consider that the mobile application industry is expected to grow to be a 27 billion dollar industry by the end of 2013, it's pretty obvious that hopes and expectations for said industry are high.

Back when Citibank released their predictions for the application market, I and many others found it hard to believe that the industry would grow by nearly sevenfold in just over two years. According to a report from CNN Money earlier this morning, however, the mind-blowing industry growth may not be quite so far-fetched. The report originated with Piper Jaffray's Gene Munster, which revealed that the App Store is doing quite well for itself.

Keep in mind that Apple doesn't release official deets on the App Store often, so Munster had to create his own model; I suggest taking it with a grain of salt.

Munster's report revealed that iOS users are buying 61 percent more apps than they were last year and they are actually paying 14 percent more on average per app. The average iOS user will download 83 applications in 2011 versus 51 applications in 2010. Munster states, “Smartphone users are showing an increasing appetite to use apps to add features to their phones,” which makes perfect sense considering there are over 425,000 apps available. In addition, the likely culprit for the jump in average selling price is the introduction of the iPad, as the larger, HD apps generally cost a few dollars more than their iPhone counterparts.

Munster has given the public some pretty interesting insight on how iOS users are continuing to use the App Store, but what about other platforms? I can't say much for Windows Phone 7, BlackBerry or webOS as I haven't used any of those platforms as my primary in a very long time. But when it comes to Android, I know the ropes pretty well.

I still buy some apps on Android, especially when I feel I really need one. The last app I actually purchased was Camera ZOOM FX, thanks to the G2x's lackluster camera software. But ever since Amazon introduced their own Appstore, I've been extremely hesitant about pulling the trigger on paid applications for Android. Knowing that any given day, that $10 app I've been wanting may be the "free app of the day," it's well worth the wait and gives my wallet a much needed rest. That said, Amazon has ensured that I will probably download at least one app every couple days, whereas before, I wouldn't unless I needed my phone to do something new.

What has ultimately changed when and why I download applications though, are the several tablets I've recently owned. Having a blown-up smartphone is essentially pointless without applications. Sure, browsing the web is much easier on the larger display. But web browsing is hardly a strong selling point for a $500 luxury item. It's all about the apps. I've filled both my iPad and Transformer with at least 60 apps each, many of which are tablet-only applications.

With more applications available on a daily basis, it only makes sense that users will begin to download and purchase more applications. And as the functionality increases, the price of such applications will rise accordingly. However, smartphones are not the only vehicle responsible for enormous application industry growth. Tablets – however unnecessary they may be – are selling like hot cakes, increasing demand for HD tablet applications and games as well. Onward and upward!