China leaps ahead of Japan, is now second in global iOS app revenue

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China just beat Japan to take second position for global revenue from iPhone and iPad apps, a new report says.

The US is still the king of iOS app revenue generation in Q1 2016, according to App Annie (PDF link). However, China’s snapping at its heels, with a 2.2 times growth year-on-year that made it move up a notch since January.

In terms of the sheer number of app downloads, China took the top spot last year, overtaking the US. That’s thanks to China’s huge number of smartphone owners as well as Apple’s big screen iPhone 6 and 6 Plus, say the App Annie analysts.

But as any startup will tell you, getting people to download apps and making money off them are two different things.

In the first quarter of 2016, despite China getting close to “peak smartphone,” the rate of revenue growth accelerated year over year – up from 2 times growth in Q1 2015.

But all of that is still not enough to match in-app spending in the United States, which maintains a 30 percent lead on China for total iOS App Store revenue. This is because more users are willing to pay for app services like Netflix and Spotify as well as making other in-app purchases.

Infographics by App Annie.

Android trends

App Annie expects worldwide app store downloads across all OSes to grow 33 percent to 147.3 billion in 2016, driven largely by smartphone adoption in emerging markets.

In the first quarter, Vietnam experienced the fastest year-over-year percentage growth (1.7 times) in Android app downloads from Google Play from Q1 2015. It also ranked second in market share growth, the report said. Games contributed to half of the growth of Google Play downloads in the country.

Argentina and Egypt followed, with 1.4 times growth each.

However, India led global trends on overall year-on-year market share growth for Google Play, outstripping Vietnam.