People are using apps more than ever, but paying less for them
Rising prices have had shoppers tightening purse strings all over, and not even smartphone apps have been immune from the impact of this financial pressure. Thankfully, there are lots of fantasticfree Android appsto choose from, but developers who aim to monetize their software are feeling the pinch. The annualState of Mobilereport from analytics firm data.ai, formerly known as App Annie, has just revealed that spending on apps and IAPs dipped for the first time ever in 2022, but people are nonetheless using apps more than before.
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Non-game apps actually saw a revenue increase of 6% year-over-year (YoY) to a total of $58 billion in 2022, primarily on the strength of social media and streaming apps, the top two categories of earners. Games were the main contributor to the overall downturn, as spending in this segment slid 5% to $110 billion. 1,419 gaming apps raked in $10 million in revenue during 2022, similar to the 1,433 that reached this threshold in 2021. But only 224 crossed the $100 million mark, representing a 4% decline YoY. A dismal 10 games had revenue exceeding a billion dollars, down from 15 last year.
The report paints a much rosier picture of app download trends in 2022. Game downloads breached the 90 billion mark in 2022, up 8% YoY, while downloads for all other types of apps rose 13% YoY to a record 165 billion. Simulation titles drove the rise for games, while app downloads were boosted by offerings in the personal finance category, such as loan apps, rewards apps, and expense trackers. Interestingly, crypto-related apps saw downloads plummet 55% in the last year (not unlike the value of those assets themselves).
Downloads and financial stats aside, data.ai’s report also shows people spent a whopping 4.1 trillion hours using mobile apps in 2022, up 9% from 2021. On a more granular level, people spent five hours per day in mobile apps — approximately a third of the average person’s daily waking hours, and 3% more time than last year’s average. This appears to be a global trend, as users in many of the top 10 analyzed markets clocked over five hours of daily usage, on average.
So where were smartphone users spending all their time? People gave 35.8% of their attention to social media and communication apps like WhatsApp, Facebook, Twitter, Discord, and even theGoogle Phone app.Entertainment appslike YouTube, TikTok, Netflix, and Spotify ate up 33.9% of a user’s time. 15.7% of people’s time was spent in various, smaller app categories, while the remaining 14.6% was used on productivity apps like Chrome, Google Maps, and the lowlyClock app.
Instagram dethroned TikTok as the most downloaded title of the past year, but the short video app kept its ranking of highest revenue and became the only app other than Tinder to record over $6 billion in lifetime spending. Facebook remained the undisputed champion of retaining the most monthly active users (MAU) despite the hordes of rival social media platforms luring them away. In fact, the rest of the top four apps by MAU retention are also all Meta properties: Instagram, Facebook, and WhatsApp.
All things considered, it’s still been a pretty solid year for mobile apps, especially when compared to other markets amidst ongoing financial uncertainty. The app economy continues to evolve and adapt to changing consumer behavior, and we certainly expect it to continue growing in the coming years. Developers and companies will just need to stay on top of the latest trends and consumer preferences to stay competitive.
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