China Tops US in App Store Spending

By Features PCmag

Apple iOS users in China spent $1.7 billion at the App Store in the third quarter, beating US spending by 15 percent to become the largest market in the world for iOS apps.

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The spending totals, released in a report this week from analytics company App Annie, reveal a large spike in the value of App Store spending in China this year. In the third quarter of 2015, Chinese iOS users spent about $700 million, less than the US and Japan.

So what is prompting the Chinese to open their wallets? Games, according to the report. App Annie claims that while 75 percent of App Store apps aren't games, they account for 75 percent of the store's revenue.

Entertainment was the second-largest spending category. That includes apps like Youku, similar to YouTube, and Tencent Video. Much of the spending on both entertainment and games comes not from buying the apps themselves (they're free in many cases), but on in-app purchases like subscriptions and individual movies.

The rise of Chinese entertainment apps may be due to the fact that Apple's shuttered its own entertainment offerings this past spring, including iBooks and iTunes. The Chinese government reportedly ordered the shutdown over censorship concerns. Still, Apple takes a cut of all App Store revenue, so it still benefits from increased spending on third-party apps.

Earlier this year, App Annie predicted that the global app market is expected to grow 24 percent from $41.1 billion in 2015 to $51 billion by the end of 2016. And by 2020, revenue across all app stores is expected to exceed $101 billion globally.

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This article originally appeared on PCMag.com.