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FINANCE<br />
free apps – a model that has become a hit with<br />
the mobile gaming industry.<br />
By 2010, Apple introduced the iPad, creating<br />
a further opportunity for app developers who<br />
began to design apps specifically for iPads. By<br />
2011, the App Store had recorded 10 billion<br />
downloads. With the explosion in the number<br />
of apps, Apple brought in two small, yet<br />
significant, innovations. The first was the<br />
concept of folders to place the dozens of apps<br />
that each user would download on their phone,<br />
and the second was the ability for apps to<br />
multitask on the Apple devices. For example,<br />
you could play music off one app and<br />
simultaneously browse the internet.<br />
By January 2012, over $4billion had been paid<br />
out to developers and by March that year Apple<br />
said that it had hit 25 billion downloads from its<br />
store which was by then operational in 155<br />
countries. By 2015, the Apple Watch launch<br />
meant one more canvas for developers to unveil<br />
a whole host of apps specific to the wearable<br />
device, with many of them focused on health<br />
and well-being. Last year, Apple gave the App<br />
Store a much-needed aesthetic overhaul.<br />
Reportedly, the App Store is now home to<br />
over two million apps and there are around<br />
498,000 app publishers developing content for<br />
the repository. Worldwide, there were 23.4 app<br />
downloads in Q4 2017, 7.3 billion of which<br />
were from the App Store and 16.1 billion from<br />
Google Play. WhatsApp, YouTube, Facebook,<br />
Messenger and Instagram are some of the most<br />
downloaded apps.<br />
The biggest challenge for app developers today<br />
isn’t designing them in as much as monetising<br />
them. The App Store revenue model is based on<br />
four categories: Free Model that includes apps<br />
which are completely free to download and use;<br />
Freemium Model where users download an app<br />
for free, but are then charged an additional fee<br />
for premium features or services which block<br />
adverts on the app. Popular gaming apps operate<br />
using this in-app purchase model and now<br />
accounts for 80 per cent of the total spend in app<br />
stores. Apart from the Paid Apps model that<br />
requires you to pay an upfront fee to download<br />
the app, there’s also the Subscription Model,<br />
with an auto-renewable option and a Paymium<br />
Model too which is a hybrid between the Paid<br />
and Freemium Model.<br />
to over $110 billion. China is the market that<br />
Apple is watching the closest – it is the top<br />
market for iOS consumer spend, having<br />
overtaken the US in 2016. The predictions are<br />
that by 2020, there will be 5 million apps in the<br />
App Store.<br />
Even though the number of apps in the App<br />
Store will shoot up exponentially, it’s also<br />
becoming a more crowded space where people<br />
are being far pickier than they were earlier and<br />
only downloading apps they absolutely need.<br />
The new wave of apps integrates machinelearning,<br />
big data, AI and more. For example,<br />
the San Francisco health-tracking company<br />
Cardiogram has developed an app that can be<br />
loaded onto an Apple Watch and uses its<br />
machine-learning model called DeepHeart to<br />
predict with 97 per cent accuracy abnormal<br />
heart rhythms, sleep apnea with 90 per cent<br />
accuracy, hypertension with 82 per cent accuracy<br />
and diabetes with 85 per cent accuracy.<br />
The App Store, figuratively and literally, is<br />
a lifesaver.<br />
THE FUTURE OF APPS<br />
Market research firm App Annie<br />
has predicted that in <strong>2018</strong>,<br />
worldwide consumer App<br />
Store spend will grow 30<br />
per cent year-on-year<br />
23<br />
EQUITY
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