Apps Earn Their Own Conference

appnationAppNation Conference launched September 13-14 in San Francisco drawing an inaugural crowd of 1200+ developers, marketers, vcs and agency folks to discuss this emergent ecosystem. This post will cover the conference, marketplace, potential and where we are today based on a Nielsen report released at the event. First, a video interview with conference organizer, Drew Ianni:

AppNation, the Conference:

The conference was expected to draw about 700 attendees but word-of-mouth buzz and local news coverage created a rush at the doors, earning over 1200 participants. The spirit of the event was like most early-day gatherings of movement creators where a sense of greater good and mission to contribute to defining a new space trumped titles, company alliances and egos. It will likely be recalled by participants as a moment when the industry was purer and more collaborative. The speaker line-up was top-rate with a mix of leaders from established media, marketing and capital institutions and upstarts as appropriate for an emergent space. If anything, I felt like most panels could have been carried by just one or two of the speakers and were less effective by having 4 panelists plus a moderator.

The Marketplace

As with any emergent market, don’t be fooled by numbers. In-App advertising and paid downloads are just two sources of revenues. In addition to social-gaming apps earning over a billion dollars today in virtual goods and currency there are brand extensions/service (to think big dollars, consider “Enterprise”), development and delivery infrastructure and more. There’s also the freemium model, where light versions of applications act as advertising and convert engaged users up to paid models at low costs of acquisition. So nailing down the size of the market is tricky, but it’s helpful to see what people are doing today as an indicator of hot spots to watch:

Most Popular AppsGames, Utilities, News and Entertainment dominate today’s most popular applications according to Nielsen’s report, The Rise of Apps Culture available on SlideShare. If you group utilities into location-based search it quickly rises to the top of the list aggregating activities like maps, weather, local news, restaurant and shoppint.

Age and location likeliest indicators of how you use your phone according to Nielsen research.

According to GetJar, the second largest Apps store, 65% of apps downloaders are 18-34 years old, 57% downloaded mobile apps/software over games at 22%, music at 10% and wallpapers 8%.

Most Popular Apps by OSWhen you look across mobile Operating Systems you can see the power of vertical integration for Google services like Navigation and Goggles elevating the mapping function on Androids. Also interesting to see Twitter rising up on the thick-thumb-friendly Blackberry platform. And, based on these statistics, you can see how the omnipresent, killer app Facebook can take a page from Google on the benefits of vertical integration by creating its own device as rumors suggested this past weekend.

One research report suggested that already 24% of Americans use Apps, which is an amazing accomplishment in just two years. 20% is usually the moment researchers point to as a tipping-point for technology, and several sources forecast smartphone penetration exceeding 50% by end of 2012. So, we’ll take 24% today. Here’s how they get to these numbers:

Of the 82% of adults today who are cell phone users, 43% have software applications or “apps” on their phones.  When taken as a portion of the entire U.S. adult population, that equates to 35% who have cell phones with apps.  This figure includes adult cell phone users who:

  • have downloaded an app to their phone (29% of adult cell phone users), and/or
  • have purchased a phone with preloaded apps (38% of adult cell phone users)

Yet having apps and using apps are not synonymous. Of those who have apps on their phones, two-thirds of this group (68%) actually use that software.  Overall, that means that 24% of U.S. adults are active apps users today. (shout out to Donovan Pugh for breaking it down).

The Potential

The fact Apps got their own conference became newsworthy. Walking around the show room floor, seeing the infrastructure and talent moving into this space you could sense a feeling that the next “network” or entertainment channel was in the works. If you think I’m overstating, inquire a little deeper about where apps sit in the hearts and minds of those 24% of our population who use them. You can do this with an informal man-on-the-street interview of smartphone users in airports or bars: ask what apps they use and how it adds value to their lives as well as their devices. You’re likely to hear people admit guilty pleasures at worst (like reality TV) or unbridled passion and advocacy (like cult movies or TV shows). Apps have entered popular culture–we mentioned Angry Birds the plush toys & movies in the works a few round-ups ago–and are becoming an indispensable part of the changing ways we relate to each other, to content, with brands and with our devices. That bodes well for the AppNation organizers and participants. Will this become the next CES, Comicon or E3? Drew Ianni believes so. What do you think? Debate in the comments below…

Light snacking: we’ll close with Revision3’s AppJudgement wrap-up of coolest apps from the AppNation conference:

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