With Google Play stunted, China’s $35 billion app industry is like no other

China may be the world’s fastest growing smartphone market but the country’s growing app space is a very different one to that of North America, Europe and other Western markets.

Android is the dominant smartphone operating system (OS) in the country, accounting 68 percent of smartphone sales in the final quarter of 2012, yet the Google Play store is a much less frequented destination for device owners there than might be expected.

The search provider’s much publicised issues in China — which saw it relocate its search engine to Hong Kong in 2010 — have had repercussions on its Google Play app store. The service is not blocked in China, despite an outage in October, but censorship issues mean that it contains only free apps, with developers preferring to publish and market their offerings elsewhere.

This gap leaves China’s app space looking like no other, with a series of other firms stepping in to aim at the huge demand, providing apps for Android, iOS and other platforms away from the official channels. That’s significant for more than just financial reasons, as Google, Apple and others would prefer to have more control over the apps that customers are loading into their devices, with malware one concern for third-party app stores.

In contrast to Google-Android, Apple is very much in the hunt for China’s app market, which Analysys estimates to be worth $35 billion, Bloomberg reports. The Cupertino-based company opened its App Store to local payments in China last year, and that has contributed to its significant profits in the country.

The 💜 of EU tech

The latest rumblings from the EU tech scene, a story from our wise ol' founder Boris, and some questionable AI art. It's free, every week, in your inbox. Sign up now!

However, culturally, Chinese smartphone users are inclined to turn to other sources, despite local App Store support. The remainder of the competition comes from operators, fronted by China Mobile, the behemoth that has more than 660 million subscribers, more than any other mobile operator in the world.

As we revealed in January, the ‘Mobile Market’ app store has more than 149 million registered users, who make 30 million downloads each month. Last year, the store’s revenue hit $3.6 million (23 million yuan).

That figure is growing but the traffic it generates is equally as important, China Mobile CEO Li Yue told Bloomberg:

The reason we care about this business is that it can help drive or promote our other businesses. If a developer makes a very good app, then it will help boost traffic on our network and help our growth that way.

While China Mobile has reach, its 68,663 app strong store doesn’t have anything like the same scale as Apple – which has more than 560,000.

Fellow operators China Unicom and China Telecom also run their own app stores which, in addition to third party offerings — such as 91 mobile — gives the Chinese industry a very different outlook to Western markets.