Led by a surge in smartphone sales, the application or app market in the country is likely to grow by more than four times to $ 626.23 million (around Rs. 3,800 crore) by 2016, with paid apps contributing Rs. 2,065 crore.
The Indian Council for Research on International Economic Relations (ICRIER) said that the total worth of Indian app economy is worth $ 150 million currently (about Rs. 900 crore) but it has immense potential to grow.
"India is on the cusp of a data revolution that will be led by mobile as has been the case with voice," ICRIER Director and Chief Executive Rajat Kathuria said here at a broadband conference organised by Sri Lanka-based think tank Lirne Asia.
"A number of factors favour an app revolution in India -the existence of developers, a billion connections, a deficit in service delivery through conventional means, a competitive mobile market combined with a serious attempt to address regulatory constraints,' he said.
He said there are around 3 lakh app developers in the country with about 100 million app downloads every month. There are, however, many developers who are building apps for the global market and not necessarily for India.
Kathuria said application stores such as Google's pay higher revenue share to the developers as compared to the Indian mobile operators. He said India needs local application distribution platform that provide 70-30 revenue share to developers.
"Telecom operators may have a role to play, provided they offer competitive revenue share to app developers, in facilitating mobile payments since they cater to large prepaid segment," he added.