Mobile Industry Devouring PC Industry: 25 Billion App Downloads, 6% Global Web Traffic

The mobile industry is growing at an outstanding rate. As we previously reported, mobile browsing currently makes up for six percent of global web traffic. That market share was hedged in just the last few years, within five years of the first iPhone and first Android phone, and within two years of the first iPad release.

The widespread use of mobile devices, such as smartphones and tablets, has hardly begun and, already the internet is beginning to change as a result. While web browsing is a major segment of the mobile industry, what's more impressive are the mobile app traffic acquisition numbers.

Mobile app downloads from iOS and Android will hit 25 billion before the end of the year, according to Flurry, a mobile analytics firm.

For a while, the customer base for the iPhone and Androids were largely early adopters, said Peter Farago, head of marketing at Flurry, in a NYTimes report. Now, it's become a much more global market, especially as the prices for both devices have come down.

More than 440 million iOS and Android devices have been activated since 2007, the year that both mobile platforms launched, according to Flurry. While mobile device sales have soared, mobile app consumption has been even more tremendous: On a month-to-month timeframe, mobile app downloads have been growing at about 11.4 percent. In Oct. 2011 alone, 2.6 billion mobile apps were downloaded in the Android Market and Apple App Store.

If mobile app downloads continue to increase at a steady rate, by Dec. 2011, mobile app downloads could reach 3 billion downloads per month.

Even though application downloads are growing and show no signs of slowing down, once any application is downloaded onto a consumer's mobile device, it faces its steepest challenge. According to Flurry data, after being downloaded, applications are often discarded, not opened or uninstalled.

Within just one month of being on a device, a mobile app can drop from having a user retention of 100 percent to 38 percent, meaning that consumers are not opening the application as often as once had when they first downloaded it. User retention continues to dip to 14 percent at the six month mark and four percent at the twelve month mark.

The key challenge is that developers lack the tools to bring traffic back to their app, post-download. And, therefore, the industry has a traffic acquisition problem, not a discovery problem, says Flurry in a blog post. So as an app's installed based grows over months, even years, the relative number of incremental users that can be added from ranking in the charts continues becomes relatively smaller. In other words, over time, an app is better off targeting its much larger installed base of users to increase usage. This is the equivalent of traffic acquisition.