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iPhone owners in US spent $40 each on apps in 2016

Pokemon Go helped boost gaming revenue in Apple's App Store, while spending on streaming services more than doubled.

Pokemon Go took the world by storm last year, boosting revenue for app stores, including Apple's.
Sarah Tew/CNET

People are spending so much time on their phones that a European city has installed traffic lights in intersection sidewalks to try to keep "smombies" (smartphone zombies) safe.

But smombies are good for business, at the very least for Apple in the US.

iPhone users in the US are spending more and more on apps and in-app purchases. Spending climbed to an average of $40 per person last year, according to research released Monday by Sensor Tower. This is up from $35 in 2015.

Gaming continued to lead the way, accounting for more than 80 percent of Apple App Store revenue in the US. Spending in that category increased from $25 on average per person in 2015 to $27 last year. This may not be the biggest surprise, given that 2016 witnessed the rise of Pokemon Go, which crossed $1 billion in revenue worldwide last month.

The "entertainment" category, home to apps for streaming services such as HBO Now, Hulu and Netflix, saw spending more than double year over year. Netflix, for one, raked in $58 million in revenue from App Store subscriptions in 2016.

Continued spending on iPhones and on the apps downloaded to them is of intense interest to Apple. The company generates about two-thirds of its sale revenue from the iPhone. In late January, Apple reported that it sold 78.3 million iPhones in the quarter that ended Dec. 31. That's more than in any previous quarter in its history, snapping a three-quarter streak of iPhone unit sales declines.

Despite app revenue shooting up last year, app downloads were slightly down. The average iPhone user in the US downloaded 33 new apps last year, Sensor Tower said, less than the 35 in 2015. That may be part of a trend as well. Previous Sensor Tower research showed that 1 percent of app publishers rake in 94 percent of revenue.

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