Apps stores ignore low-end handset market

Staff writer  |   June 16, 2010

CommunciAsia Show Daily

Emerging markets in Asia, with just 6% of users owning handsets with an open OS, are an untapped opportunity for operators to generate revenue from apps stores.

Amrish Kacker, head of Asia Pacific for Analysys Mason, said just 1% of mobile subscribers in Asia pay to download games compared to 60% of iPhone users. Apps also are becoming an impulse purchase, he noted.

“This is a huge opportunity for operators to expand from such a small base,” he said.

Speaking yesterday in the mobile VAS stream at the CommunicAsia Summit, Kacker said the profile of handsets in emerging markets is vastly different than in the closely-watch developed markets and not enough attention is paid to midrange and low-end phones.

Some 57% of handsets aren’t GPRS enabled while 37% are closed OS devices. Feature phones are expected to account for 50% of handsets by 2013, with the share of open OS devices increase to 18% during that period.

Operators in these markets need to start exploring other ways to deliver apps such as IVRs and SMS. If they rely on users moving to data services, he said they first have to get users to access the Internet and of course have to offer prepaid services. “The concept of paying for service on a regular basis is already there in Asia. Look at ringback tones in Thailand and other markets.”

He also noted that the definition of an app is different in emerging markets. It doesn’t have to be downloaded. “Basically it’s anything to get people to pay for a service.”