Ever wondered who pays for the awesome game you just downloaded from the Google Play store for free? Or how does the mobile game developer get his costs back and manages to stay alive while you are playing for weeks and months without paying a single penny? As you may have guessed, most of mobile apps make their money through advertisements.

The in-app banner and interstitial ads are one of the major sources of revenue for the app developer. Such ads are part of the ad networks. InMobi, one of the world's largest independent mobile ad network, engaging 691 million consumers across 165 countries, has recently published some interesting insights into mobile app world.

The InMobi App Insight Report summarizes unique trends and insights based on the analysis of over 7000 app promotion campaigns that ran on their network in Q2 2013. The report is particularly useful to app developers who rely heavily on trends, insights and data intelligence provided by ad networks.

Here are some highlights from the report:

Top countries with Mobile App Downloads

Over 50 Million app installs were delivered on the InMobi network in 2013 till the date the report was published. USA led the countries with nearly 34% of the apps downloaded and India was a distant second, with a little more than 9% of the total apps downloaded.

Not surprisingly, the top 5 countries accounted for over 60% of the overall app downloads. Japan, China and Indonesia lagged behind India in the top 5. But US is still the top country with 15.4% in terms of tablet usage on InMobi platform (with India nowhere in top 10) and the iPad covering a whopping 54% of total ad impressions.

Top categories of apps

Of all the different app categories on the InMobi network, games represented the most downloaded category. Juniper Research's report had predicted in the "Future App Store: Discovery, Monetization & Ecosystem Analysis 2013-2018," report that gaming will fuel a sharp hike in app downloads – in 2017, over 160 billion apps will be downloaded globally onto consumer handsets and tablets.

The trends observed on the InMobi network are in tandem with this prediction, with games as a category representing a strong 64% of the total apps downloaded through their network. Communication apps were a far 11.3% and telecom 6.8%.

Some interesting insights and trends

The ad which completely covers your mobile/tablet screen is an interstitial – they are the new love for users. Upto 25% click through and 10% conversions have been seen on interstitial ads on the InMobi network which should push app developers to ride this wave.

The average conversion rates for interstitials across app categories ranged from 8% for comics to 5.6% for Health and Fitness. However, the good old banner ads continue to work well for a wide range of non-gaming apps on both iOS and Android with conversions of upto 3.5% for Software on Android and 2.6% for Weather on iOS.

The bottom-line is a good mix of HD banner ads along with interstitials can help the app reach audiences on a wide range of devices and rotating ad formats can reduce ad fatigue, thus increasing ad engagement.

Does OS matter?

Interestingly, on Android, the average conversions on interstitial ads are almost double (1.73% for iOS to 3.06% to Android) than that of other ad formats like Banner Ads, Expandables and Text Ads where iOS rules the roost. However, for Q2 2013, Apple manufactured 53.9% of total tablets compared to Samsung's 28.4% and Amazon's 4.1%.

Which site to target for maximum conversions?

Almost all kinds of sites delivered good downloads on games – suggesting that the audience for this category is diverse and widespread. Sports and health & fitness sites delivered maximum downloads for social apps. On the other hand, communication sites delivered the most downloads for entertainment apps.

Are tablets important?

In tier 1 cities, most users will own a tablet by the end of 2013, generating 3x more download revenue than smartphones. For InMobi, one out of every three app promotion campaigns on the network also ran on tablets.

The timeshare for tablets is a mindboggling 90 minutes compared to the 58 minutes for mobile and 50 minutes for desktops. Thus users are at least 3X more open to consuming ads on tablets compared to smartphones.

Which ads work well on tablets?

A quick comparison between tablet CTRs and average ad network CTRs reveal that text ads don't work well on tablets. However, interstitial ads deliver solid results with almost 46% higher CTR for tablet campaigns.

User acquisition costs?

Indexed against the costs in the US, the research indicates that driving a download in most markets, especially in China, Japan and Korea is relatively cheaper in comparison to the US market , with the UK representing the most expensive markets and India the least expensive.

New revelation?

China is the new US.

According to IDC, in February 2013, China overtook the US to become the world's largest smart device market, with 246 million devices (against the US 230 million) and accounted for 26.5% of all smartphone shipments last year.

Concurrent with the growth in smart devices, mobile applications are also growing at an astronomical rate. In addition, the falling price of the iPhone and the increasingly capable low to mid-range Android handsets now available have further propelled this growth.

Google has now released it's 8th update to the transparency report that they started publishing in 2010. Globaly, the requests from governments for user information have more than doubled.

In it's first transparency report that came out in December 2009, Governments across the  had made 12,539 user data requests, while in the latest report that number has more than doubled to 25,879.

While the data and user account requests are increasingly exponentially, it is interesting to note that Google is providing lesser amount of data in percentage terms. In 2010, Google provided data for 76 percent of all the requests made to them, while in the latest update for 2013, the data produced was only 65%.

Requests by India

India remained the country with 2nd highest number of requests made to Google. While US topped with 10,918 requests in Jan-June 2013 period, India made 2,691 requests during the same time.

Google furnished some data to 64 percent of requests made by India, which is in line with global average. Like it's global counterparts, Google has been returning lesser data with each passing year. In 2010, the same percentage was much higher at 79 percent, which is now at 64 percent.

Does these transparency reports help?

While it may not help ordinary users, they definitely help in bringing transparency to consumers. Also, when Google puts such kind of data out in open, authorities do understand that they need to have a legitimate and legal reason for asking for a user data.

Also, after Google started publishing these transparency reports, other large online players like Facebook, Twitter, Microsoft and others have also joined the bandwagon.

And lastly, if not anything, users start feeling that much more safer with their data residing on their servers.

What do you think?

For the first time in the history of smartphone sales, Lenovo has become world's third largest smartphone vendor, as it surpassed LG Electronics and sold 12.8 million units in the third quarter of 2013.

Android remains world's most preferred operating system with 82% share in the overall market of smart phones. Analysts are predicting overall 1.8 billion units of mobile phone sale by the time 2013 finishes.

These facts were revealed in the Gartner's Q3 report for global mobile sales in 2013.

Report Highlights

- Smartphones continue to outsell feature phones globally. This trend had started in the last quarter, when for the first time ever, more smart phones were sold compared to feature phones. Overall, out of 456 million mobile phones sold all over the world, 250 million or 55% were smartphones. Last year in the same period, smartphones accounted for just 40% of the total mobile sales.

- In the overall sale of mobile phones, Samsung is the clear winner as of now. Capturing 26% market share, Samsung sold 117 million units in Q3, which is an increase of 3 percentage points compared to last year.

- Despite all bad news, Nokia is still world second largest mobile phone vendor, as it sold 63 million units in Q3; although this 13.8 market share is nearly 6 percentage points lower compared to last year.

- Apple is at #3 in overall mobile phone market, with 6.7% market share. It sold 30 million units in Q3, which is an increase of 1 percentage point. Point to note that the holiday season has just begin, and Apple is known to be a killer for this phase. The next quarterly results would be interesting to watch out for Apple.

- In smartphones, Samsung is again the clear winner. It has captured 32% of market share with sale of 80 million units in Q3. Total of 250 million smartphones were sold globally last quarter.

- Apple is at #2 with 30 million sales and holding on to 12% market share. Compared to last year, although the total number of units sold has increased by 6 million, but the market share has come down by 2 percentage points.

- And the clear winner in the smart phone segment is Lenovo, which has become #3 biggest seller of smartphones all over the world. LG is now at #4 position, Huawei at #5 position with 11 million units sold. In case you are from US or any other western country and wondering how Lenovo became a market leader in smartphones, then you are not to be blamed. Lenovo is riding on its domestic market success in China, which accounts 95% of all Lenovo smartphone sales.

- If we observe the Operating System market, then we can see that Android is still holding the fort, without any visible threat from anyone near. In the last quarter, Android enabled smart phones has captured whooping 82% of all smartphone sales. Out of 250 million smartphones sold worldwide, 206 million were on Android platform.

- iOS from Apple is at #2 and Microsoft is still at #3 position with 8.9 million units. Last quarter, Microsoft had jumped to #3 position by beating Blackberry, and the trend continues.

- Blackberry OS is at #4; Bada OS at #5 and Symbian at #6.

A very interesting observation which was made regarding sales of Android enabled phones globally: Other OS developers and vendors are obviously worried about the 80% market share but it is also worth noting that almost 40% sale of all Android devices worldwide is coming from one region: China.

And when this market becomes saturated, the market share of Android can seriously come down.

Besides China, India is the next biggest market for Android enabled phones. Slowly other operating systems such as Firefox are also entering the system, and it is expected that the market equations will change in future.

But for time being, its Samsung and Android which are calling the shots; and the holiday season would be really interesting to look out for.