China has its own Macworld/iWorld conference and plenty of iPhone fever, but the paid-download app market appears to still be maturing there. A new report from Shanghai-based analyst firm Stenvall Skoeld claims that the Chinese version of the iOS App Store accounted for 18 percent of total downloads in the second quarter, but just 3 percent of revenue.
The report estimates that the country’s share of total App Store revenue was significantly smaller than the estimated 42 percent revenue share from the US, which accounts for 28 percent of downloads.
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Apple’s App Store revenue in China amounted to $37 million over the quarter, up 105 percent from last year. Apple is expected to grow its app revenues in the country this year by 98 percent to $171 million, as Stenvall Skoeld’s charts illustrate.
China stands as Apple’s second-largest app market in terms of downloads. It’s notable that, according to the research, the vast majority of iOS downloads in China are free apps. The average revenue per iOS app download in China was estimated at 3 cents, significantly lower than the global average of 19 cents.
At the least, Apple’s App Store revenue is better than that of the Google Play store, which does not yet support paid downloads in China.
To arrive at the numbers, the firm extrapolated from Apple’s fiscal third-quarter results and then combined those figures with analytics data from App Annie.
Anecdotally, one possible reason for the low revenue figures in China could be piracy. A large percentage of Chinese iPhone users that I’ve come across use jailbreak solutions to gain access to free applications. Stenvall Skoeld director Carl-Johan Skoeld estimated that as many as 40 percent of Chinese iPhones are jailbroken, though he described piracy as “only one of many contributing factors.”
Developer Chris Pruett recently tweeted that almost 100 percent of pirated downloads of his applications, which are on both Android and iOS, originate from China.
New Q2 numbers from Canalys revealed that smartphone shipments were up 199 percent year over year in the country and represented 27 percent of global shipments. Samsung leads that pack with a 17 percent market share in China, followed by domestic vendors LTE, Lenovo and Huawei. Apple is believed to have slipped to fifth-place in the region.
An earlier report from Stenvall Skoeld found more than half of the 21 million iPhone owners in China to be located in urban areas like Beijing and Shanghai.
You can read the App Store report in full here.