Tapping the App market

In the increasingly tech-savvy Gulf mobile apps are becoming big business

A recent study by telecoms equipment firm Ericsson forecast that mobile subscriptions in the Middle East and North East Africa are set to reach 970 million by 2020. Of these, 40 per cent will be smartphones – indicating a substantial market for businesses to serve.

Apps have changed consumer habits in the region with users increasingly reaching into their pockets to fuel their app addiction. According to the latest study by mobile market research firm On Device Research, almost 41 per cent of the users in the UAE downloaded paid apps over the last 30 days, increasing to 51 per cent in Saudi Arabia. More broadly 50 per cent of users in Egypt, Lebanon, Saudi Arabia and the UAE downloaded more than five apps – both paid and free – in the last month with gaming and social media the most popular choices.

Around 44 per cent of the consumers performed in-app purchase, the poll showed. Of which 39 per cent said that they paid to avoid advertisements while around 37 per cent paid to get additional content.

“People are more willing to pay to get more content, which is good news for the region,” says Nader Kobeissi, managing director, MENA, On Device Research.

“We also looked at whether the same people who paid for the apps do the in-app purchases and the answer is pretty much yes. Only 3 per cent paid for an app and did not do an in app purchase. To me it is that if you get somebody to pay for the app, you will definitely get somebody to pay for an app again.”

One of the reasons that people don’t spend too much on apps is that they have trust issues with the mobile payments or they have privacy issues where they don’t want to give personal details. But that is not the number one reason here in the region. Users are looking for apps and they want to buy them but they don’t find the right ones. That is good news for developers.”

Noting that more than half of users (53 per cent) had not bought apps in the region, Kobeissi says there is still a significant opportunity for developers to tap into the market and monetise their offerings. Although, he noted several barriers preventing more app purchases in the four countries surveyed.

“One of the reasons that people don’t spend too much on apps is that they have trust issues with the mobile payments or they have privacy issues where they don’t want to give