The average smartphone user devotes two hours a day toward using mobile apps—whether it be for gaming or social networking purposes. The free app trend is rapidly growing; 81 percent of the Google Play Store and 90 percent of the App Store is comprised of free apps. For 2013, the global app business is expected to make a whopping $25 billion in revenue, up 62 percent from last year. How are apps making so much money?

The Freemium App Model offers apps free of charge, while requiring charges for advanced features, functionality or virtual goods. This model marks a shift away from the practice of posting in-app advertisements and pay-per download model. Candy Crush Saga and Pandora are just two of the apps that are free for download and make money from in-app purchases.

There are some drawbacks to the Freemium App Model. Developers take on a huge risk and games targeted for kids can draw a huge bill if parent supervision is lacking. To learn more, check out the infographic below presented by Startapp.

Startapp-freemium-in-app-purchasesv5a

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