Just days into the Chinese New Year (Year of the “Snake” for anyone keeping track), China has passed the U.S. to become the world’s top country for active Android and iOS smartphones and tablets. This historic milestone takes place a year after Flurry first reported that China had become the world’s fastest growing smart device market. Since then, it took China’s rapidly growing middle class just twelve months to close the gap on the U.S.
For this report, Flurry uses its entire data set, tracking more than 2.4 billion anonymous, aggregated application sessions per day across more than 275,000 applications around the world. Flurry estimates that it reliably measures activity across more than 90% of the world’s smart devices.
Reviewing the chart shows that China and the U.S. had roughly the same active smart device installed base in January 2013, 222 million in the U.S. versus 221 million in China. We use a model to project the final February 2013 installed base for each country based on historical growth trends as well as the number detected devices per country through the first half of February. Flurry estimates that by the end of February 2013, China will have 246 million devices compared to 230 million in the U.S.
We also conclude that the U.S. will not take back the lead from China, given the vast difference in population per country. China has over 1.3 billion people while the U.S. has just over 310 million. Considering that the U.S. has the world's 3rd largest population, the only other country that could feasibly overtake China sometime in the future is India, with a population of just over 1.2 billion. However, with only 19 million active smart devices in India, China will not likely see competition from India for many years. Below, we show the top 12 countries by active iOS and Android installed base through the end of January 2013.
The chart shows that the U.S. and China each have more than five times the active installed base than that of the U.K., the world’s third largest market. Additionally, both China and the U.S. continue to see rapid device adoption. Year-over-year, compared to January 2012, the U.S. added 55 million new devices. However, in that same time, China added a staggering 150 million new devices. With its growth rate, China would have passed the U.S. earlier, except for the U.S.’s massive holiday season, which enabled the U.S. to hold off China for an additional two months.
The final chart in our analysis shows growth in the number of active smart devices per country, between January 2012 and January 2013. While China no longer leads the world in growth, it still commanded an impressive 209% rate of growth on top of a base of 71 million devices from January 2012. For this chart, Flurry selected countries that had a minimum of half a million devices as of January 2012. Countries that grew faster than China over the last year were Colombia, Vietnam, Turkey, Ukraine and Egypt. While the four BRIC countries are not all among the top 12 countries in terms of percentage growth (specifically, Brazil and Russia are not top 12 "growers"), all four are among the top 12 when calculating the number of net active devices added per market (i.e., Brazil +11.5 million, Russia +12.0 million, India +12.4 million, China +149.5 million).
In this new era of mobile computing, sparked by a confluence of powerful innovation across microprocessors, cloud storage and network speeds, Apple and Google have helped create the fastest adopted technology revolution in history, 10X faster than that of the PC Revolution and 3X that of the Internet Boom. And now, as the largest and fastest modernizing country in the world, Chinese consumers lead that revolution.
Flurry recently quantified China’s meteoric adoption of iOS and Android applications. While China ranked 10th in application sessions at the beginning of 2011, it finished the year in 2nd place, only behind the United States. With its large population and rapidly emerging middle class, adoption of apps vaulted China into the position of world’s 2nd largest app economy. In additional analysis, Flurry also determined that China has the most market upside, based on calculating those in China who can afford smartphones versus the current installed base.
This report reveals that, for the first time ever, China now leads in new smart device adoption (iOS and Android smartphones and tablets). We also update app usage velocity trends for China and the rest of the world, since first studying this late last year. For this report, Flurry used its entire data set, tracking more than 1 billion anonymous, aggregated application sessions per day. More than 60,000 companies use Flurry Analytics across more than 160,000 applications.
China's Growth Spurt
Let’s start with a look at the fastest growing countries, as measured by app session growth.
Comparing Q1 of 2011 versus Q1 2012, the chart above shows the ten fastest growing countries in terms of app sessions. A session is the launch and use of an application. For example, a consumer who opens a news application and then spends two minutes reading various articles counts as one session. Starting on the left, China leads the world in app session growth, with an enormous growth rate of more than 1100% between Q1 2011 and Q1 2012. China’s growth rate is particularly staggering given that it was already the world’s 7th largest country in terms of app sessions by the end of Q1 2011. This speaks to the country’s sheer population as well as increasing affluence among a meaningful part of its population. Please note that we project the last ten days of Q1 2012.
Building an App? Go East, Young Man!
We next study new device activations between China and the U.S., with amazing results.
The above chart shows new iOS and Android device activations per month in the U.S. and China for the last 15 months, from January 2011 through March 2012. In January 2011, the U.S. accounted for 28% of the world’s total iOS and Android device activations, while China accounted for 8%. In February, Flurry calculated that China surpassed the United States in monthly new iOS and Android device activations for the first time in history. China is now the world’s fastest growing smart device market. For March, we project that China will account for 24% of all iOS and Android device activations, while the U.S. will account for 21%. Again, please note that we project the several days of March to round out Q1 2012.
With China now activating more devices per month than the U.S., this means that the gap is closing between the two countries in terms of installed base. Not only is China already the second largest app economy, but also could eventually overtake the U.S. as the country with the largest installed base of smart device users. We estimate that the U.S., a more mature market, currently has more than twice as many active devices than China. However, China, a faster growing, emerging market, already has twice as large an installed base as the next largest market, the UK.
Apps Without Borders
In this last chart, Flurry looks at the shift in application usage across the world.
The chart above compares mobile app sessions tracked by Flurry Analytics in Q1 2011 versus Q1 2012. The green area shows the percent of app sessions occurring in the United States, the leading mobile app market. While the absolute number of sessions in the U.S. has more than doubled between Q1 2011 and Q1 2012, its share of total sessions has declined from 56% to 46%. In other words, while the U.S. app market is growing rapidly, the rest of the world is growing even faster. Looking at the balance of the top 10 countries (ranks 2 – 10: China, UK, South Korea, France, Australia, Canada, Japan, Germany and Spain), this group has increased in collective sessions by 3.4 times between Q1 2011 and Q1 2012, resulting in an increase in total session-share from 27% to 30%. Further, the rest of the world (another 217 countries across which Flurry tracks user sessions), has grown by more than 4 times, increasing in session-share from 17% to 24%.
No matter how we slice it, the application market continues to grow at unprecedented rates, and increasingly across more borders. With smart devices adoption rates more than four times greater than those witnessed during the 1980s PC revolution and twice as great as those seen during the 1990s Internet Boom, no other consumer technology has been more accessible than smart device application software. It’s literally taking over the world.
The era of mobile computing, heralded by Apple in 2007 with the debut of the iPhone, has put powerful, networked computers into consumers’ hands. Onto these devices, consumers have downloaded billions of apps. In 2011 alone, we estimate that 25 billion iOS and Android apps will be downloaded. And Flurry expects that number to roughly double in 2012.
Like other new technology, adoption of iOS and Android devices began primarily in North America and Western Europe, where disposable income is higher. However, as prices have come down for older iOS models, and OEMs supporting Android have offered more affordable down-market devices, we’re seeing a clear shift in consumer app usage to international markets, including emerging economies. Let’s warm up with a chart showing how mobile app sessions are expanding outside of the U.S.
The chart above compares mobile app sessions tracked by Flurry Analytics in January 2011 and October 2011. Flurry now tracks over 20 billion mobile app sessions per month across more than 120,000 applications. The green area shows the percent of app sessions occurring in the United States, the dominant mobile app market. While the absolute number of sessions in the U.S. has doubled between January and October, its share of total sessions has declined from 55% to 47%. This means that the rest of the world is growing faster. Looking at the balance of the top 10 countries (UK, Canada, Australia, France, Germany, Japan, Indonesia, South Korea and China), this group has increased in collective sessions by 2.7 times between January to October, resulting in an increase in total session-share from 28% to 31%. Further, the rest of the world (another 217 countries across which Flurry tracks user sessions), has increased in session-share from 17% to 22%. Among all this growth, there is one country that has caught our attention more than any other.
Meet the Mobile Dragon
You may have heard of China, and its 1.3 billion people. In fact, you most likely associate the country with high volume, affordable manufacturing. However, China is also fast becoming one of the world’s most promising consumer economies. Earlier this year, Bloomberg reported that 2010 foreign direct investment in China rose to a record $106 billion. Included in this are investments by companies such as Wal-Mart, which co-invested over $500 million in online retailing. According to the International Monetary Fund, China has the world’s second largest gross domestic product, behind the U.S., and ahead of Japan, Germany and France. Additionally, the Boston Consulting Group released a report in November 2010 forecasting that the number of middle-income and affluent consumers will almost triple in the next 10 years to 415 million. As it relates to mobile, China has the most cellphone users in the world, with over 950 million users according to statistics released by China’s Ministry of Industry last week.
To understand how this translates into mobile app adoption, Flurry compiled a list of the fastest growing mobile app markets in terms of sessions tracked by our service. We show the chart below.
This chart ranks the top 10 countries, in terms of mobile app session growth, from January 2011 to October 2011. To be included in the analysis, countries had to have generated at least 10 million monthly sessions in January. Inspecting the chart, it’s clear that China’s growth is astronomical. While the top 100 countries are averaging session growth of over 200%, China is delivering more than four times this growth rate, spurred by a massive population voraciously adopting applications.
China Vaults to Second Largest App Economy
With its hyper-growth in app sessions, China has moved up the ranks among the world’s top countries to now occupy the second spot behind the U.S. The graph below charts China’s share of total mobile app sessions per month, relative to other top countries during 2011. Note that to get a better view of movements among countries ranked second through fifth, we exclude the U.S. from the chart, given its scale.
China, represented by the red line, began the year ranked tenth in terms of app sessions, with 1.8% of all sessions tracked by Flurry. By April, China had climbed to fifth with 2.7% of all sessions, and, in July, overtook the United Kingdom to become the second largest country, with 5.4% of sessions. By the end of October, China had further grown to 7.3% of sessions. The U.S., which declined in sessoin-share over the year, finished in October with 47%. If both China and the U.S. were to continue along their respective trajectories, China could overtake the U.S. by the end of 2013, with both countries converging around 23% app session-share.
Finally, we took a look at AppCircle, Flurry’s mobile app traffic acquisition network to understand advertising dollars companies are willing to spend on acquisition per market. In this part of the business, we measure from which country consumers are downloading news apps advertised to them. The country of origin is a reflection of geographic consumer demand. Overall, downloads of new apps from China grew from 1.2% to 12% over the course of the year, from January through October. Similar to the total growth we saw in Flurry Analytics user sessions, the Flurry AppCircle network grew by 2.5 times. The chart below shows AppCircle-driven downloads per country for the month of October 2011.
Whether studying China by existing app session generated or new demand for apps, the growth rates are similar. As one of the fastest modernizing and largest countries in the world, the adoption of mobile apps in China is unprecedented. For app developers, who more traditionally look at North America and Europe, China is a market too compelling to ignore. A new market has emerged, and China is the new mobile app dragon.