India’s app economy snapped back to growth, with downloads climbing to 25.5 billion in 2025 after slipping the previous year, according to new figures from Sensor Tower. The rebound was powered by a surge in AI assistant usage and an unexpected breakout in microdrama apps, which together also pushed total time spent in apps to 1.23 trillion hours, up from 1.13 trillion in 2024.
Despite leading the world in downloads, India still lags far behind on consumer spending in apps, underscoring a persistent monetization gap. But the shift in what Indians are downloading—and how long they’re staying engaged—signals a meaningful reshaping of the country’s mobile habits.
AI Assistants Ignite Fresh Demand Across Categories
Generative AI apps went mainstream last year. Sensor Tower’s data shows downloads of such apps leapt from 198 million in 2024 to 602 million in 2025, making AI one of the strongest growth engines across categories. ChatGPT led India’s generative AI charts by installs, with Google Gemini, Perplexity, and Grok rounding out the top tier.
Two forces explain the spike. First, richer multimodal models from major labs elevated everyday use cases—image generation for social posts, voice summaries of news, and on-the-fly translation in Indian languages. Second, aggressive go-to-market tactics tailored to India—free or extended premium trials and lightweight on-device features—reduced friction. Industry watchers at data.ai have noted that India’s habit of cycling through multiple apps to test value is unusually high, making freemium models particularly effective.
The AI lift spilled into adjacent categories: video editing and social discovery apps benefited as creators used AI to script, dub, and stylize short clips. That interplay between creation tools and consumption platforms amplified the overall engagement bump.
Microdrama Outpaces Traditional OTT Platforms
Short, snackable serials—vertical episodes running one to three minutes—became a fixture of India’s commute and tea-break culture. Downloads of short drama apps grew by more than 350 million, Sensor Tower reports, and after the third quarter, new installs of microdrama platforms surpassed those of major OTT streamers.
Kuku TV, Story TV, QuickTV (from the makers of ShareChat and Moj), and DashReels ranked among India’s top video apps by installs in 2025. Kuku TV’s parent raised $85 million in a Series C led by Granite Asia, fueling original content pipelines. QuickTV’s co-founder told CNBC that over 40 million users are now watching microdramas on its service, a sign that the format has moved from curiosity to habit.
The monetization thesis is different from long-form streaming: ad-supported viewing, branded storylines, and low-ticket micropayments. With production costs a fraction of traditional TV and OTT, platforms can iterate rapidly, test arcs with data, and spin up localized series in Hindi and regional languages without blockbuster budgets.
Quick Commerce And Utility Apps Lift Local Share
Domestic publishers grew their share of installs from 33.91% to 36.52%. That momentum appears less about entertainment and more about everyday utility: quick commerce, government services, and finance. Ultrafast grocery players like Blinkit, Zepto, and Swiggy Instamart helped pull food and delivery into the fast-growing cohort, Sensor Tower found.
On the public services side, the steady usage of DigiLocker, UMANG, and state-level apps reflects how mobile has become the default interface for documents and benefits. Finance remains anchored by UPI-led apps such as PhonePe, Google Pay, and Paytm, which keep downloads high even as in-app purchase revenue for local publishers stays flat.
This is the paradox of India’s scale: immense install volume, but value capture weighted toward ads and transactions, not subscriptions. Analysts at IAMAI and Kantar have consistently tracked strong growth in digital advertising, while paid content adoption inches forward more slowly.
Why India Leads In Installs But Not In Spend
Three structural factors dominate. First, data is cheap and ubiquitous—TRAI’s historical benchmarks put India among the lowest-cost mobile data markets—so experimentation flourishes. Second, a massive Android base and rising 5G coverage lower barriers for heavy app use, as Counterpoint Research has noted for smartphone shipments and network upgrades. Third, subscription spending per user remains low, pushing developers to ad-supported and transaction-led models.
For AI and microdrama, that means the winning playbook in India emphasizes reach and retention over early monetization. Platforms are likely to blend ad formats with commerce—think shoppable scenes in microdramas or AI assistants that generate affiliate-ready recommendations—before nudging users toward paid tiers.
What To Watch Next In India’s Mobile App Market
Expect telcos and handset brands to bundle AI assistants and creator tools in device deals, deepening distribution. Short drama platforms will test payments inside stories, creator tipping, and brand-funded seasons. Regulators are also circling generative AI and synthetic media; clarity on disclosures and watermarking could shape growth trajectories, especially for content apps.
For now, the takeaway is straightforward: India’s mobile market is finding new energy in AI-first experiences and micro-length storytelling. The download rebound is the headline, but the stickiness—the hours people are spending—suggests these trends have staying power.