The number of mobile application users is set to quadruple in five years, according to new research from In-Stat. And while Apple's iPhone is leading the charge, In-State says worldwide sales of open source-based smartphones are expected to be double that of devices based on Apple's software over the same time period.
The increase in smartphone app usage is also providing unprecedented opportunities for mobile marketing, which in turn will result in a whole new industry catering to mobile ad analytics, said David Chamberlain, principal analyst at In-Stat and author of the report, "The Apps Store is Born: Smartphones Enable New Marketing and Advertising Opportunities Worldwide."
Chamberlain projects the number of devices supporting mobile applications to grow to about 140 million by 2013, creating a new revenue stream for mobile advertising.
Mobile app-centric smartphones -- led by the iPhone and Android-based handsets -- will reach more than 30 percent of the global smartphone market. With the customer base expanding and users downloading more mobile apps, Chamberlain said there's a huge opportunity to capitalize on the format.
Part of what's driving the boost in mobile app use is the shift in how they're accessed by customers. "The app store is going to live on the handset, which will bring on a big boost in adoption," said Chamberlain. "The model up to now involved going online and picking one out and downloading it, but we're moving away from that now."
The report also touches on smartphone sales broken out by mobile operating system, and the numbers look good for those based on open-source. "When you look on a global basis, Apple is only a tiny part of the smartphone market," said Chamberlain. "We didn't break out Android separately, it's with Linux and other open-source devices, but we're predicting in five years that ultimately sales of Linux and Android will be double that of devices based on Apple's OS."
Apple's iPhone app store has had unprecedented success, with more than 800 million downloads since it launched last summer. The concept was quickly copied by Google for phones based on its Android operating system. RIM is expected to launch its own app store this month, while Palm and Microsoft have similar plans.
Meanwhile, the smartphone market is heating up, with sales pegged to grow, albeit at a slower rate, over the next five years. This comes as new Android devices are slated to enter the market this year, as well as Palm's Pre, all gunning to grab market share away from the iPhone.
Meanwhile, hardware makers such as Acer are scrambling to enter the fray while industry watchers speculate that Dell and others may also join in.