Making millions in downloadable apps

Telephia just published a report on the market for mobile downloadable applications, which is the first time in a while they’ve given numbers on this space.  Since Telephia’s metrics are taken from the source (cell phone bill scanning), they can generally be trusted.

‘Of the $118 million in revenue that downloadable mobile applications such as LBS, weather applications, chat/community, and personal organization tools generated during Q2 2007, LBS represented 51 percent.’

Now $118 million in a quarter is a big number for downloadable apps.  The LBS percentage has grown substantially from a couple years ago, but that makes sense because of the high price point for navigation apps and the promotion of GPS capabilities by the carriers.

Significantly, two navigation companies, NIM and Telenav, are generating 42% of this revenue.  After LBS, the long tail of categories begins …  including apps such as music (Pandora), address book backup (MightyBackup), weather (Accuweather), yellow pages (Superpages), IM (AOL’s AIM), maps/directions (MapQuest), and of course widgets (WHERE).

In Telephia’s last report on this market, in Q1 2006, revenue from mobile downloadable apps was roughly $18 million per quarter.  That would indicate the downloadable application market has been growing  somewhere around 13% per month.  Not a bad number.

Another recent report Telephia published was on mobile video, in which they state that mobile video revenues in the U.S. totaled  $146 million in Q1 2007, growing 198 percent year-over-year.  Also not bad.  Mobile video has been heavily promoted by the major carriers over the last couple years. 

The lesson is that when US carriers are willing to put some marketing muscle behind downloadable applications, they succeed.  A multi-million campaign of tv, web, print, when combined with in-store promotion, retail sales training, and good deck placement can yield impressive results.

Leave a Reply

Your email address will not be published. Required fields are marked *