App downloads stagnated in fourth quarter, new analysis finds • TechCrunch

The global app economy Slow down for the first time last year Consumer spending on apps fell 2% to $167 billion, according to the latest annual report released by Data.AI. At the same time, downloads were up 11% year-over-year – a seemingly positive indication that app adoption is still on, driven especially by emerging markets. But deeper Analysis The fourth quarter points to a slowdown in download growth at a time of the year, which is generally a boon for the app ecosystem. The holiday season brings new phones and more free time for consumers to try out new apps and games, which makes these new figures even more surprising.

According to the intelligence agency of the app Sensor towerMobile app adoption across the App Store and Google Play Store Leveled to Q4 2022Declining a slight 0.1% year-over-year to reach 35.5 billion new installs in the quarter.

Image credit: Sensor tower

It’s analyzed on a per-user basis, meaning additional downloads of an app by the same person on different devices don’t count toward the total. This does not count app reinstalls only to show an increase in new downloads. However, its statistics are only estimates.

While the fourth-quarter trends weren’t enough to pull up the overall year-over-year download growth metrics, it appears to be another sign of a stagnant app economy — one that, no doubt, is normalizing after additional growth during Covid, and one that the overall aggregate Influenced by economic forces, which also play an important role in app marketing costs.

But there’s another argument to be made, and that’s that years of high-value commissions on app sales and in-app purchases across app stores worldwide are finally starting to have an impact on innovation in the larger app ecosystem. If companies have to fork out up to 30% of their revenue just to distribute their apps and games to a mobile audience, it’s harder for them to weather storms like a down economy. And entrepreneurs may be less inclined to build for mobile, especially, when other areas of the market are less constrained. Look at developments around crypto and Web3, for example — they haven’t been able to fully expand to mobile due to app store guidelines and the platforms’ need to profit from in-app purchases. With so much pressure on app innovation, it’s no surprise to see downloads and consumption suffer.

This trend isn’t just evident in metrics around stagnant app install rates and declining spending.

Another example of ecosystem disruption is visible in Apple’s editorially selected top apps of 2022. A tribute to reflect the opportunity to create for mobile, Cupertino company Z highlighted social networking app BeReal as its “App of the Year” as “arguably a breakout success with young people, an app with daily active users.” Falling far behind Its download statistics and currently has no business model — the app doesn’t generate revenue yet. fueling its continued existence VC financing, is not the ability of the App Store to provide a platform where new ideas can easily monetize And its developers are struggling to come up with what kind of subscriptions or in-app purchases they can convince their young users to pay for — the result of an app marketplace that has sold consumers for years on the idea that mobile software should be free.

Then there are the apps that topped Sensor Tower’s list of most downloaded apps in Q4 2022 — apps from tech giants like Meta and ByteDance, cornering each other for the top spot. Over the years, it’s been rare for a newcomer to find a way onto this list, and that remains true in the fourth quarter.

Image credit: Sensor tower

Globally, Instagram overtook TikTok for the number one spot, and Meta’s other apps ranked in the top 10 (Facebook at No. 3, WhatsApp at No. 5, Messenger at No. 8, and WhatsApp Business at No. 9.) ByteDance’s CapCut, an extension of TikTok’s workflow, 4 no. Other top apps include the usual suspects, such as Snapchat, Telegram, Spotify, Amazon, Flipkart, Twitter, and more big names.

In games, Subway Surfers was No. 1, followed by Garena Free Fire, Stumble Guys, Roblox, FIFA Mobile, Ludo King and Candy Crush Saga. Subway Surfers ended the year with nearly 292 million installs, up 48% from 2021. Newcomer Stumble Guys took the No. 3 spot with more than 184 million downloads, which is notable because it only launched in 2021 while the other top five apps were released in 2017 or earlier — a highlight amid an otherwise quarter-over-quarter decline for mobile game installs. place

In the App Store, game downloads fell by 6.9%, while in Google Play, they gained a smaller 0.6%.

Image credit: Sensor tower

Still, the games section continues to install apps. In the App Store, it accounted for nearly three times as many installs as the No. 2 category, utilities, the report noted. But alarmingly, the games category of the App Store has dropped below 2 billion since Q1 2019.

On Google Play, the games category accounted for more installs (11.7 billion) than all categories of the App Store combined (8.1 billion), but the Play Store’s non-game categories fell 1.5% year-over-year to 15.8 billion. by installing

It’s too soon to tell whether current trends represent the final cooling off of the app store gold rush, with broader economic forces clearly playing a role in app adoption and spending here. Also, new app markets are coming online which means more first-time app downloads. But for now, the trend is a signal that there is some saturation in the top app market and suggests that app stores need to start to innovate and grow more, forcing them to engage in increased competition.

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