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Ⓒ App Annie 2013!
Japan Outspends US, Continues Meteoric Growth!
1. Japan Revenue Overtakes US! 2. How Japan Hit #1! 3. Japan’s Strongest Performers! 4. Looking Ahead to 2014! 5. Conclusions & Key Takeaways!
2!
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Ⓒ App Annie 2013!
Japan Now #1 Country in App Store Revenue!
Indexed Revenue!
Combined Store and Google Play AppApp Revenue ! ! Combined iOSiOS AppApp Store & Google Play Monthly Revenue 350! Japan! United States!
300! 250! 200! 150!
South Korea!
100!
United Kingdom!
50! 0! Oct 2012!
Oct 2013!
• Over the past year, Japan’s app store spend has exploded, exceeding growth in other major markets! • Japan now top-grossing country across iOS and Google Play combined 3!
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Ⓒ App Annie 2013!
Japan Outspends US, Continues Meteoric Growth!
1. Japan Revenue Overtakes US! 2. How Japan Hit #1! 3. Japan’s Strongest Performers! 4. Looking Ahead to 2014! 5. Conclusions & Key Takeaways!
4!
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Ⓒ App Annie 2013!
Smartphone Adoption Catching Up Rapidly in Japan! Annual Mobile Phone Penetration! United States!
100%! 80%! 60%!
28%!
42%!
40%! 20%! 0%! 2012!
% of Population!
% of Population!
Japan! 100%! 80%! 60%!
39%!
44%!
2012!
2013!
40%! 20%! 0%!
2013!
Smartphone users! Other mobile phone users!
Smartphone users! Other mobile phone users!
Japan Population: 127M**!
US Population 317M**!
• While Japan is a mobile-centric society, smartphone adoption has lagged behind other major markets; feature phones already were quite advanced! • Smartphone penetration in Japan started catching up rapidly in 2013 5! Sources: eMarketer 2013, ** CIA July 2013!
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Ⓒ App Annie 2013!
Mobile Digital Content Market Already Strong in Japan!
Market Size (Yen)!
Mobile Phone Digital Content Market in Japan! Annual Mobile Phone Digital Content Market in Japan! 900B! 800B! 700B! 600B! 500B! 400B! 300B! 200B! 100B! 0B!
Smartphone Market!
Feature Phone Market!
2009!
2010!
2011!
2012!
Source: Mobile Content Forum, Japan, August 2013!
• Japanese consumers already have been accustomed to purchasing digital content (e.g., music and games) on feature phones! 6! • Digital content market has been growing steadily the past few years! CONFIDENTIAL PROPERTY OF APP ANNIE - DO NOT DISCLOSE
Ⓒ App Annie 2013!
Google Play Caught Up to iOS in Japan App Revenue! iOS App Store Google Play Monthly App Revenue ! iOS App vs. Store vs. Google Play Revenue! Rest of World!
250!
Indexed Revenue!
Indexed Revenue!
Japan! 200! 150! 100! 50!
250! 200! 150! 100!
0!
50! 0!
Oct 2012! iOS App Store!
Oct 2013! Google Play!
Oct 2012! iOS App Store!
Oct 2013! Google Play!
• App spend on Google Play has skyrocketed in Japan, far outpacing growth in the rest of the world! • Google Play has closed the gap with iOS in app revenue in Japan 7!
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Ⓒ App Annie 2013!
Carrier Billing for Google Play Japan Facilitates Payment!
…In some markets, Google has teamed up with wireless carriers… to include app purchases on phone bills, [Director, Google Play] Kochikar said.! ! In Japan and South Korea, two countries with direct carrier billing, Google developers have seen revenue jump almost 14- fold, the company said.! ! ! ! ! ! ! Source: Bloomberg, February 2013!
• Japan traditionally has relied on cash, rather than credit cards! • Google Play introduced carrier billing for Japan’s leading mobile carriers (NTT DoCoMo, KDDI, and Softbank) in early 2011 8!
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Explosive Growth in Games Drove Japan Revenue! Combined iOS App and Google Play Monthly App Revenue ! Combined iOSStore App Store and Google Play App Revenue! Rest of World!
Japan!
300! 200!
3.9x!
100! 1.3x!
0! Oct 2012!
Oct 2013!
Apps Excluding Games!
Games!
Indexed Revenue!
Indexed Revenue!
400!
400! 300! 200! 2.7x!
100! 1.9x!
0! Oct 2012!
Oct 2013!
AppsExclusing ExcludingGames! Games! Games! Apps
• Growth in games spend in Japan dramatically outpaced growth in the rest of the world! 9!
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Ⓒ App Annie 2013!
Japan Outspends US, Continues Meteoric Growth!
1. Japan Revenue Overtakes US! 2. How Japan Hit #1! 3. Japan’s Strongest Performers! 4. Looking Ahead to 2014! 5. Conclusions & Key Takeaways!
10!
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Ⓒ App Annie 2013!
Domestic Publishers Led the Growth in Japan! Combined Playand andGoogle iOS App Store Game Revenue in Japan! Combined iOSGoogle App Store Play Monthly Game Revenue in Japan! ! 700! Top 5 Publishers by Gain in Monthly Game Revenue from Oct 2012 to Oct 2013:
Indexed Revenue!
600! 500!
1. 2. 3. 4. 5.
400! 300! 200! 100!
GungHo Online LINE COLOPL SEGA NAMCO BANDAI
All other publishers
0! Oct 2012!
Oct 2013!
• While Puzzle & Dragons from GungHo Online has dominated the headlines in Japan this past year, LINE, COLOPL, SEGA, and NAMCO BANDAI also saw significant growth in game revenue
11!
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Ⓒ App Annie 2013!
Riding the Dragons: The Success of GungHo Online! Puzzle & Dragons passed 10 million downloads*! Puzzle & Dragons passed 20 million downloads*! TV commercials began airing!
Puzzle & Dragons passed 1 million downloads*!
12!
* Figures released by GungHo!
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Source: Bloomberg, 2013!
â’¸ App Annie 2013!
COLOPL’s Home Run Hitters! Quiz RPG passed 10 million downloads*!
Pro Baseball PRIDE passed 3 million downloads*!
Quiz RPG! passed 5 million downloads*! TV commercial began airing!
Initial public offering!
13!
* Figures released by COLOPL! CONFIDENTIAL PROPERTY OF APP ANNIE - DO NOT DISCLOSE
Source: Bloomberg, 2013!
Ⓒ App Annie 2013!
COLOPL’s Quiz RPG Spiked After TV Commercials! Quiz RPG:! World of Mystic Wiz!
• After TV commercials began screening, downloads* tripled in 3 months! * Source: COLOPL, 2013! ! TV ad campaign launched!
14!
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• TV commercials also have driven huge growth in Japan for other games, such as Puzzle & Dragons!
LINE Expands from Messaging App to Game Platform! • LINE announced explosive growth in users throughout 2013! 100 million!
18 Jan 2013!
150 million!
30 Apr 2013!
200 million!
21 Jul 2013!
300 million!
25 Nov 2013!
• LINE also established a gaming platform that integrates with the messaging service. Hit games include:!
LINE POP!
LINE Pokopang!
LINE WIND runner!
• The company is rumored to be considering an IPO* 15!
* Source: Reuters, October 2013 CONFIDENTIAL PROPERTY OF APP ANNIE - DO NOT DISCLOSE
Ⓒ App Annie 2013!
Japan Outspends US, Continues Meteoric Growth!
1. Japan Revenue Overtakes US! 2. How Japan Hit #1! 3. Japan’s Strongest Performers! 4. Looking Ahead to 2014! 5. Conclusions & Key Takeaways!
16!
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Ⓒ App Annie 2013!
Smartphone Adoption in Japan Will Accelerate in 2014! Projected Annual Mobile Phone Penetration! United States!
100%! 80%! 60%!
42%!
62%!
40%! 20%! 0%! 2013!
2014!
Percent of Population!
Percent of Population!
Japan! 100%! 80%! 60%!
44%!
50%!
2013!
2014!
40%! 20%!
Smartphone users! Other mobile phone users!
0%! Smartphone users! Other mobile phone users! Source: eMarketer, Inc., 2013!
• Japan is far from being saturated for smartphones; penetration is expected to grow further in 2014, overtaking that in the United States and 17! contributing to further app store gains CONFIDENTIAL PROPERTY OF APP ANNIE - DO NOT DISCLOSE
Ⓒ App Annie 2013!
iOS Device Sales Grow After DoCoMo Adds iPhone to Its Lineup in September 2013! Apple's Share of Smartphone Unit Sales! 60%!
50%!
40%! 37%!
34%!
32%!
Q1 2013!
Q2 2013!
20%!
0%! Q4 2012!
Japan!
United States!
Q3 2013! Source: IDC!
• DoCoMo added the iPhone Sep 20, so Q3 only partly reflects the impact • It will be interesting to watch how Apple’s device install base* and app revenue develop in Japan in the coming months 18!
(* Note: A shift in device sales does not necessarily result in a shift in install base) CONFIDENTIAL PROPERTY OF APP ANNIE - DO NOT DISCLOSE
Ⓒ App Annie 2013!
Japan Outspends US, Continues Meteoric Growth!
1. Japan Revenue Overtakes US! 2. How Japan Hit #1! 3. Japan’s Strongest Performers! 4. Looking Ahead to 2014! 5. Conclusions & Key Takeaways!
19!
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Ⓒ App Annie 2013!
Japan: Conclusions & Key Takeaways!
! Japan has surpassed the United States to become the top-grossing country by combined iOS and Google Play app revenue! • Smartphone adoption has been catching up rapidly in Japan! • Google Play revenue has soared in Japan, catching up to iOS! • Games revenue in particular has exploded in Japan! ! Publishers that rode the wave to success in Japan included not just GungHo Online, but also LINE, COLOPL, SEGA, NAMCO BANDAI! • Successful publishers were domestic, having local knowledge! • TV advertising is effective in driving app performance in Japan! ! ! More investment opportunities await in Japan next year! • Smartphone adoption will accelerate in 2014! • iOS devices more accessible with DoCoMo offering the iPhone! 20! Sources: App Annie Oct 2012 vs. Oct 2013, eMarketer, IDC! CONFIDENTIAL PROPERTY OF APP ANNIE - DO NOT DISCLOSE
Ⓒ App Annie 2013!
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â’¸ App Annie 2013!