Apple App Store downloads in China triple, but revenues for developers still lag

Foreign gaming firms are recruiting and receiving a growing number of proposals from Chinese developers

Downloads from China on Apple's App Store have tripled from a year ago, but developers in the country must continue to look overseas to generate revenues, because of the prevalence of free apps, according to an app market analytics firm.

"In order to be at the top, you cannot just be focused on the Chinese market. If you want to make money you have to be focused on the international market," said Bertrand Schmitt, CEO of App Annie in Beijing.

Schmitt made his comments on Thursday while speaking at the Mobile Game Summit Beijing, where he showed new data on China's Apple App Store market.

As of May, China had the second highest number of iOS app downloads in the world, right behind the U.S. But the country ranks eighth in total revenues generated from iOS downloads, putting it behind the number one ranked U.S., Japan and the U.K.

Although China has a billion mobile phone subscriptions, the country has also been plagued by piracy. In the case of the iPhone, users sometimes choose to jailbreak their iPhones, allowing them to install paid apps for free.

In China, this means every iOS app download generates about US$0.03 when comparing gross revenue against total downloads, according to App Annie. In comparison, an iOS app download in the U.S. generates $0.28.

Many of China's app developers already target overseas markets. The country's top ten publishers on Apple's App Store get on an average about 90 percent of their revenues outside China, with the range extending from 29 percent to 99 percent, according to App Annie.

Despite the piracy and prevalence of free apps being downloaded, revenue in China from iOS downloads grew by 213 percent in May when compared to a year ago. Download numbers also increased by 305 percent.

Apple's iOS, however, captured only a minor portion of China's smartphone market. In this year's first quarter, Apple's iPhone had a 19 percent share of the market, while Android-based handsets had a 68 percent share, according to research firm Canalys. But in tablets, Apple's iPad continues to dominate sales in China.

Besides Chinese gaming companies targeting markets abroad, foreign companies are also looking at China to get games developed for global markets.

"I'm a little bit shocked and surprised and a little bit afraid of Chinese developers because there are so many good developers coming out from China since last year," said Brian Oh, senior manager for Gamevil in South Korea, which develops games for iOS and Android. "I get tons of emails about proposals. About 30 to 40 percent are from China. So I do see potential there for the market."

U.S. gaming developer Kabam has an office in Beijing, China, which has 65 employees and continues to hire locally, said Michael Li, general manager for the company. Its popular iOS game, "Kingdoms of Camelot: Battle for the North", was developed in Beijing.

"It's definitely a good test case that shows we can build in China games that can be very successful in the West, and not just in Asia," he said.

Join the newsletter!

Or

Sign up to gain exclusive access to email subscriptions, event invitations, competitions, giveaways, and much more.

Membership is free, and your security and privacy remain protected. View our privacy policy before signing up.

Error: Please check your email address.
Keep up with the latest tech news, reviews and previews by subscribing to the Good Gear Guide newsletter.

Michael Kan

IDG News Service
Show Comments

Most Popular Reviews

Latest Articles

Resources

PCW Evaluation Team

Tom Pope

Dynabook Portégé X30L-G

Ultimately this laptop has achieved everything I would hope for in a laptop for work, while fitting that into a form factor and weight that is remarkable.

Tom Sellers

MSI P65

This smart laptop was enjoyable to use and great to work on – creating content was super simple.

Lolita Wang

MSI GT76

It really doesn’t get more “gaming laptop” than this.

Jack Jeffries

MSI GS75

As the Maserati or BMW of laptops, it would fit perfectly in the hands of a professional needing firepower under the hood, sophistication and class on the surface, and gaming prowess (sports mode if you will) in between.

Taylor Carr

MSI PS63

The MSI PS63 is an amazing laptop and I would definitely consider buying one in the future.

Christopher Low

Brother RJ-4230B

This small mobile printer is exactly what I need for invoicing and other jobs such as sending fellow tradesman details or step-by-step instructions that I can easily print off from my phone or the Web.

Featured Content

Don’t have an account? Sign up here

Don't have an account? Sign up now

Forgot password?