Until now, China was among several regions that could not use its local currency for making purchases from the iTunes App Store. This created a huge barrier for anyone who wanted to purchase apps since one of the only legitimate ways to purchase apps would be to use a credit card from another region (like the US or UK), an option very few had.
This all changes with Apple’s new policy to accept RMB payment in China. Users can now purchase apps and make prepaid payments (up to 500 RMB) using local bank cards.
Why is this important? The app market here is huge. China has quickly become the second largest app market in the world in terms of total downloads.
Unfortunately for developers or companies selling apps, the great majority of those downloads have been free. While free downloads are skyrocketing, paid downloads in China has not been taking off, and piracy is huge.
As an example, our app Pig Rush sells for $0.99 cents (with additional, optional, in-app purchase items). Earlier this year we had a free promotion and in one weekend, more users downloaded Pig Rush in China than paid and free downloads combined in the US for the entire year. To put it another way, when you count downloaded units China is #1 with nearly 50% more downloads than the #2 region (US).
When you look at paid applications however, it’s a completely different story. Without giving exact numbers, a good sales day in the US sells more copies of Pig Rush and its in-app purchase items than have been sold in China in well… ever.
That said, I’m optimistic. While China hasn’t yet shown to be a region great for sales, its users have also never had a chance to experience the convenience that purchasing apps through the App Store has to offer. One of the main reasons the App Store has been such a success (and what others have yet to emulate) is because it’s so easy and painless to make purchases. Additionally, for many users the low price of most apps ($0.99 cents, or 6 RMB) makes going through the process of jail breaking and finding hacked .IPA files simply not worth the trouble.
It will be interesting to see if developers see a jump in paid downloads in China (they really can’t get lower), so we’ll be sure to post an update a few months from now when we have some data. In the meantime, now might be a good time to localize your apps for China!