In-App Purchase Revenue Hits Record High: Accounts For 76% Of U.S. iPhone App Revenue, 90% In Asian Markets

In SoMeIT (Social Media Information Technology), we are fully dedicated to satisfying all of your web needs, integrating your business to social networks.

Though it’s well-known that many of today’s mobile applications generate revenue through in-app purchases, a new report released today shows how powerful this money-making mechanism has become. Last January, just over half (53 percent) of iPhone App Store revenue in the U.S. was attributed to in-app purchases, but as of last month, that number has climbed to a record 76 percent. The figure varies by region, however. In Germany, for example, it’s lower – only 61 percent of revenue in February came from these in-app sales. Meanwhile, in Asian markets the number soars. In Hong Kong, Japan, China and South Korea, at least 90 percent of all revenue comes from in-app purchases. These findings are revealed in the latest report from app store analytics firm Distimo, which took a deep dive into the data in this month’s report. In particular, the report examines trends here in the U.S., looking at the business models chosen by app publishers who are using in-app purchases in their mobile applications on the iPhone. Not surprisingly, Distimo found that the majority (71 percent) of apps were “freemium” applications, meaning that the app itself was free, but other features, virtual goods, extra levels, services, upgrades, and more are available for sale once the app is on the iPhone. Another 5 percent of apps using in-app purchases were paid applications, and around a quarter (24 percent) of iPhone apps in the U.S. were paid applications only, without in-app purchases involved. In a crowded App Store where there are now some 800,000+ iOS applications to choose from, developers find it more difficult than ever to have their apps discovered, much less installed. Putting a price tag on the app itself is something that’s seen as a barrier to entry for curious or casual users, especially given that Apple’s App Store has yet to implement a “try before you buy” option, similar to what Google’s Android app marketplace, Google Play, offers through easy-to-access refunds and subscription content trials, for instance. App developers competing for precious homescreen space have clearly been cornered into adopting this business model, even though at times (and certainly in children’s applications) it can almost come across as disingenuous, or even shady, when not properly advertised. And the move towards more freemium, in-app purchase based (IAP) apps is still occurring. As noted above, more apps are generating revenue through this method than just a year ago.  Looking at

source: http://feedproxy.google.com/~r/Techcrunch/~3/5OvQOgaprtU/