The health app market, currently valued at $10B, will grow at a compound annual growth rate of 15 percent to reach $31 billion by 2020, according to a report from research2guidance.
Although the health app market has seen significant growth, Zuzana Vranova, a senior research analyst at research2guidance, said that app developers are still trying to find effective monetization strategies. Existing app revenue sources, for example advertising and paid downloads, that developers in other industries use, are not sufficient for monetizing health apps, she added.
One strategy that health app developers have found is to use the apps to sell connected devices, like activity trackers and glucometers.
“The mHealth market will step out of its niche in the next few years," research2guidance managing director Ralf-Gordon Jahns said in a statement. "mHealth app publishers will have to concentrate on selling high value health services and devices with the help of their apps in order to grow.”
Currently, research2guidance reports 45,000 app publishers are responsible for about 165,000 available health apps.
In 2013, research2guidance predicted that in 2017, worldwide mobile health market revenue will total $26 billion. The research firm said at the time that bulk of the $26 billion in revenue won’t be from paid downloads (which will make up 9 percent), but from mobile health hardware and services (84 percent). This was also consistent with research2guidance’s predictions the year prior.