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ChatGPT has created a new app sector – and Europe is leading the way

ChatGPT has spawned a new sector of AI chat apps – and Europe is the epicenter. Since the launch of the tool in November 2022, these apps have been downloaded 23.6 million times from the Google Play Store, according to research from App radar.

The study uncovered 40 AI chat apps with more than 10,000 users using ChatGPT or similar technology. Europe emerged as the world leader of the nascent segment. The continent was the birthplace of 14 apps that generated a total of 8 million downloads – 34% of the entire industry.

The rest was split between the Americas (nine apps with 2.7 million downloads) and Asia (seven apps with 7.4 million downloads). Another eight apps with 5.2 million downloads had an unknown country of origin.

Thomas Kriebernegg, co-founder and CEO of App Radar, counts the boom among the most explosive he’s ever seen for a new industry. He largely credits the media interest in generative AI and the perception that ChatGPT is groundbreaking. In Europe, growth has been further accelerated by talented developers and a receptive audience.

“In general, European consumers are much more willing to experiment with new technology than people in other regions. You can see that clearly when you compare the usage figures of fintech apps and solutions in the UK with the US.” Kriebernegg told TNW via email.

“This culture enables European app developers to grow their customer base faster before expanding into new territories.”

The continent’s most notable country is Turkey, which has attracted 5.9 million downloads across four apps, including the top three. With a growing development ecosystem, a mobile gaming hub, regulations to support startupsand a growing list of technical successeses led by Getir, the country is a potential powerhouse in the segment. But turning its early advantage into a lucrative ecosystem will be a challenge.

The promising user bases are yet to generate huge revenue.

At the moment, AI chat apps are mostly monetized with ad revenue and premium subscriptions, but basic usage is essentially free. TTo secure a large, paying customer base, developers will need to offer unique services that add great value. Unfortunately for the app makers, existing users seems reluctant to invest.

Nevertheless, Kriebernegg expects the sector to continue to grow for the time being.

“Often app segments are dominated by 10 or 20 apps that make up the vast majority of users,” he says. “Currently, eight apps have over a million users, so there’s plenty of room for new challengers.

“As the market begins to coalesce and leaders emerge, it will become much more difficult for new entrants to compete unless they bring something unique and innovative to the table.”

“Obviously this is just the beginning.

Most of the current apps are in the “Productivity” and “Tools” categories of the Google Play Store, suggesting they are designed for everyday work and tasks. A smaller group within the ‘Entertainment’ category is intended for company.

Analysts expect new use cases to emerge fairly soon, but it’s still unclear if customers will ultimately prefer specialized AI apps or “one-stop shops” that cover a variety of tasks

For the early app users, ChatGPT seems to mainly offer a smarter search function or a faster way to compose messages. The model’s Q&A capabilities are extremely popular, which may well be the case further alert Google about the future of search.

“ChatGPT apps enable this kind of natural search, where information is presented in a very intuitive way,” says Kriebernegg. “It can be more accurate and much faster than using these questions or keywords on Google. The result is that people really embrace each other ChatGPT apps as assistants.

“However, it is clear that this is just the beginning. I would expect people, once they really get to grips with generative AI, to look at how they can automate everyday tasks or help with creativity, such as producing visuals or music.”

Shreya has been with australiabusinessblog.com for 3 years, writing copy for client websites, blog posts, EDMs and other mediums to engage readers and encourage action. By collaborating with clients, our SEO manager and the wider australiabusinessblog.com, Shreya seeks to understand an audience before creating memorable, persuasive copy.

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