App economy expected to double by 2017 to $151 billion

Innovations with smart TVs and connected cars will help drive app commerce

The combined value of paid apps, app-enabled purchases of goods and services and in-app advertising is expected to double to $151 billion in the U.S. by 2017, AppNation said today.

The research shows that the largest segment of the so-called app economy is sales of app-enabled physical goods and services, which made up about $45 billion of the nearly $60 billion total at the start of 2013. By the middle of this year, the $60 billion total reached about $72 billion, which is expected to more than double to $151 billion in 2017.

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AppNation said paid app downloads are a sliver of the total, accounting for less than $1 billion in 2013 and rising to just above $1 billion in 2017.

"Despite the massive popularity of apps and a saturated marketplace in the U.S., the overall growth rate in the app economy is still accelerating and will be until at least 2015," said Drew Ianni, CEO of AppNation, a research firm. "With the number of apps used per day by U.S. consumers still expanding, and as time spent on mobile devices shifts more to use apps versus other media, it is clear that there is still a lot of runway ahead of and across all key sectors of the app economy."

AppEconomy also surveyed 2,500 U.S. online consumers, finding that mobile users under 45 are using video apps twice a week. Also, most consumers say that they find new apps through word of mouth.

The AppNation report, co-authored by Ross Rubin, an analyst at Reticle Research, noted that smartphones and tablets drive the app economy today, but connected cars and smart TVs will add to total app usage.

This article, App economy expected to double by 2017 to $151B, was originally published at Computerworld.com.

Matt Hamblen covers mobile and wireless, smartphones and other handhelds, and wireless networking for Computerworld. Follow Matt on Twitter at @matthamblen or subscribe to Matt's RSS feed. His email address is mhamblen@computerworld.com.

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This story, "App economy expected to double by 2017 to $151 billion" was originally published by Computerworld.

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