App store downloads worldwide will more than double this year to 17.7 billion (according to technology research firm Gartner). App revenue in 2011 will hit $15.1 billion, up from $5.2 billion in 2010. By 2014, app downloads will jump to 185 billion.
Gartner predicts that 81% of app downloads will be free -- a percentage that has decreased since 2008 and will continue to drop in 2011. By the end of 2014, advertising will be generating just under a third of the revenue generated by application stores, up from 16% in 2010.
Gartner notes that app stores and developers typically split revenue on a 70/30 basis. However, that model is starting to come under pressure.
In a separate report this week, Forrester predicts the mobile apps market will see new business models based on subscriptions, micro-transactions and in-app billing expand from games to other content categories including news and music.
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