• The Australian Communications and Media Authority

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31 May 2011The mobile applications market is one of a range of developments reshaping communications markets through changes in technology and use.

Mobile applications (‘apps’) are software programs that may be installed on smartphones and a growing selection of other devices. Due principally to the increased availability of smartphones -- and faster broadband on 3G mobile telecommunications networks -- mobile applications are a major growth sector in the digital economy.

This paper provides an analysis of the mobile applications market through an examination of three of the largest app stores. The analysis is designed to identify emerging issues for consumers. It examines the value chain and business models of applications development and use over the web, mobile platforms and managed services, in order to identify potential regulatory issues in the mobile applications market and consider a range of issues faced by consumers.

In 2008–09, rapidly escalating consumer detriment in the Australian mobile premium content space highlighted issues such as changing content delivery methods and business models, mobility and extended value chains. In response to that particular environment, the ACMA determined that sometimes it can be better to respond rapidly and firmly to developments that threaten consumer detriment, particularly where market conditions and product characteristics are not ideal for a co-regulatory approach. For example, there are poor incentives for industry to participate and many small players and/or complex products, especially from a consumer perspective.

Like the mobile premium services market, the mobile applications market is characterised by extended value chains and multiple players. This complexity has the potential to create issues for consumers such as lack of control over transparency and ease of transferring personal information between platforms, measuring data use via mobile applications and the clarity of charging arrangements for data.