The year in mobile apps: Where we’ve been, where we’re going

Smartphone and tablet purchases have been on the rise for several years, but 2011 was a turning point: This was the first year that these mobile devices outsold desktop and laptop PCs. The effect — and perhaps some of the cause of this — is a love affair with mobile apps, leading to more apps sold than ever and more time spent with them than ever. We mobile consumers demonstrated this very clearly both in the U.S. and abroad: Apple(s AAPL) this month hit 18 billion downloads total on its iOS App Store, and Google’s Android(s GOOG) Market likewise hit 10 billion.

As the year winds down, here’s a look back at the biggest, most significant things that happened in the apps we use on our smartphones and tablets this year, as well as the most important themes to watch out for come 2012.

In 2011…

We spent more time in apps than browsing. For the first time ever, we used mobile apps more than opening up a browser window to access Web-based services. Flurry Analytics found that users had crossed over in mid-2011; we spent 81 minutes a day in apps versus 74 minutes in a browser. A year earlier, the tally had been an average of 64 minutes in a browser versus just 43 minutes in apps.


The iOS App Store proved it is still the place for devs who want to make money. Android phone unit sales are outpacing iPhones, yet two-thirds of the most downloaded apps are free on the Android platform, indicating that users of the Google-powered devices are less interested in buying apps. The developers are the ones who feel this acutely: On average Android appmakers earned 24 cents for every dollar iOS developers make.

The app obsession went international.  As app downloads grew this year, the percentage of them coming from the U.S. shrunk from 55 percent in January to 47 percent by October. In the meantime, China’s percentage of app downloads skyrocketed 870 percent in 2011, Argentina’s shot up 527 percent and Saudi Arabia’s increased  388 percent, just to name a few, according to Flurry. Apple experienced this same trend with both its iOS app sales as well as its tablet and smartphone sales, as China quickly became its second-most important market in 2011.

Google promised, but did not deliver a solution to the Android update problem. A headache for both carriers and developers, Google publicly acknowledged the problem that not all Android devices were getting timely or consistent updates as Google frequently improved its mobile OS, and in May promised a forthcoming set of guidelines to alleviate it. Though several carriers and handset makers promised to work with Google on this, nothing of substance has materialized, and some are already calling the Android Update Alliance “dead.”

In 2012…

More HyLoMo everywhere. “HyLoMo” is a cutesy, shorter way of saying “hyper-local mobile,” a concept that’s already being infused into apps, but should take off in a big way next year. The basic concept: Much of our activity is reasonably local — we tend to shop, eat and travel in the areas near to where we live and work. Smartphones already know where we are, so apps and any service can now take advantage of the river of information that’s now available from a variety of sources about where we tend to go, what we tend to buy and what we want to do. “The amount of real-time data that’s available can change apps into being infinitely more useful,” says IMMR analyst Phil Hendrix, who’s researched this HyLoMo trend at GigaOM Pro (Subscription required). Whether that’s searching, making purchase decisions or looking for travel information, both consumers, businesses and advertisers should benefit.

Voice-control integration will explode. Apple isn’t the first phonemaker to use voice control or a natural language interface, but the iPhone 4S’s Siri, introduced in October, set off a wave of mainstream interest in the technology. And this coming year we’ll likely see much more about voice-based interfaces from its competitors — Google is reportedly working on its own version. Meanwhile, Nuance (whose technology is used in Siri) just bought rival Vlingo, in hopes of attracting more high-profile customers as “virtually every mobile and consumer electronics company on the planet [looks] for ways to integrate natural, conversational voice interactions into their mobile products, applications, and services,” Nuance CEO Mike Thompson said.

NFC grows, but not for payments. It feels like we’ve been betting on NFC for a long time. And in 2012, we’re betting on it again. There’s going to be even more activity, but it will probably not be as much about payments as the other behaviors around paying for things: marketing offers and loyalty rewards/points from vendors. You can already see this in how Google its setting up its Wallet and Offers products. Look for NFC to be weaved also into social networking and contact exchange apps next year.

More niche app stores will emerge. The other side of the coin of Apple and Google’s mobile app stores’ popularity is that it’s hard to find good apps. That means it’s more challenging for developers to get noticed. Apple’s tried to deal with this issue through curated lists. GigaOM Pro’s Colin Gibbs says (Subscription required) for Android this will mean more branded app stores, similar to Amazon’s(s amzn). The Android market “is so cluttered” that more app stores within it will emerge, he said, “either as pure retail outlets for niche markets” or companies pushing their own content. Potential examples include Best Buy and Electronic Arts. And there’s also a great opportunity for corporate-focused app stores as well.