Mobile App Market Grows in China, but Harder to Penetrate

The global market for mobile apps continues to grow, but raises business challenges for those creating new apps. Developers targeting China, the world’s largest smartphone market, face a complex and oft-times confusing process. These app makers are forced to navigate through dozens of app stores with looser rules than in the U.S., fending off cloned apps and steering around regulations and local competition.

“What’s more, companies that charge for their apps are finding they need to get more creative about business models in China since users there are accustomed to getting most digital content free,” writes the Wall Street Journal. For example, ZeptoLab UK Ltd. launched the puzzle game “Pudding Monsters” in China last year.

“Weeks before the launch, the firm scrambled to integrate with payments systems for multiple app stores, with each offering different ways for users to pay for unlocking new levels and virtual items,” explains the article. “Then, to combat rampant app piracy, ZeptoLab decided to distribute authorized versions of the app to forums and other free download sites where they knew Chinese consumers would be hunting for the game.”

“It is the same work you have to do everywhere else — times 10,” said Misha Lyalin, chief executive of ZeptoLab.

ZeptoLab’s experience is typical for the growing number of app makers targeting China. These companies know they must tap the world’s most populous country before U.S. growth slows, but the path to making money isn’t so obvious.

Whereas the U.S. deals with two primary app distributors in Apple and Google, the environment there is much more fragmented. “…most of the activity happens through app stores operated by wireless carriers, Internet companies and startups jockeying to stand out by offering unique promotions. Many target Android apps or iPhones that have been modified to download apps without going through the app store,” explains the article.

“Still, many app makers said the growth opportunities make navigating the unfamiliarities of the Chinese app market worthwhile,” concludes WSJ. “At Fotopedia, which makes photo travel magazine apps, the company said China became its largest market last year, representing 20 percent of visits, compared with 14 percent from the U.S. At the beginning of 2011, China was Fotopedia’s 10th-biggest market.”

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