Google Is Stealing Revenue Share From Apple's App Store

Tim Cook and Jony Ive Apple Portrait IllustrationMike Nudelman/Business InsiderApple’s Tim Cook and Jony Ive

Google has continued to steal mobile app download revenue market share from Apple, according to an investors note from Macquarie Research.

While both Apple and Google’s respective app stores are growing fiercely, with total spending up 83% on the previous year to a monthly total of $US1.4 billion, Google is growing far faster.

Here are the numbers from April, which Macquarie says come from Distimo, the app download research company:

  • Google Play: $US530 million, up 166%, market share = 38%
  • iOS App Store: $US870 million, up 53%, market share = 62%

Note that the last time we saw numbers from Distimo, the Google/Apple split was 37/63 in favour of Apple — so Apple appears to have lost a full point of share to Google since November 2013.

On Monday, Apple CEO Tim Cook will attempt to reignite some excitement around the iOS app environment at the company’s WWDC conference for developers. These numbers suggest Apple has high-class problems — it’s taking a 30% cut from any paid download in an environment that sees gross app revenues of $US870 million a month on iPhone and iPad.

But given that Android has a majority share of users across all devices, and its share of revenue is growing more rapidly, it’s still conceivable that one day Android may become the most lucrative platform in addition to its existing status as the most used platform. That wouldn’t hurt Apple — there’s obviously room for two — but it would hurt Apple’s brand as the premium app environment. There’s no way Apple wants to be No.2 when it comes to both users and revenues.

Here’s what Macquarie says:

Google Play share ticks down vs. iOS App Store, but growth accelerates for both. While Google Play has gained meaningful share from iOS over the past year, share appears to have stabilised in the upper 30%-area (at least for now) and ticked down 10 bps m/m to 38% of total spending in April. That said, spending on Google Play continues to grow at a much faster rate than spending on Apple’s App store, with total spending on Google Play rising 166% y/y in April (up from 162% in March). This compares to 53% y/y growth for iOS in April (though this is up 10 percentage points from March’s 43% growth and represents the highest y/y growth rate since Oct ’13).

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