"This is a mature market and will continue to grow steadily," Tao said. "But I don't think we will see a dramatic increase in the sector."
Her views were echoed by Li Senhe, chief executive officer of Zaker, a mobile news app, which collects content from other websites through copyright deals and employs nearly 200 staff.
This allows users to build their own magazine based on individual interests. "The days when you just launched a news app and users rushed to download it are gone," Li said.
Indeed, the marketplace has become as crowded as a subway train during rush hour.
Dozens of news apps have sprung up in China. They range from those rolled out by established newspaper and magazine companies to online portals and media providers, such as Toutiao and Zaker.
In this melting pot, apps run by traditional online sites are dominating the Internet media scene, but that could be changing. "Apps designed to provide news to individual tastes are now showing great potential," Tao, of Talking Data, said.
Tencent, which has the largest market share in the news app industry through its own dedicated portal, Tencent News, has already made significant moves to tap into this trend.
With 250 million active daily users, the company plans to radically update its service. "Personalizing our content will be an important part of the apps development," Wang Yongzhi, editor-in-chief at Tencent.com, said.
Finding a niche in the market will be crucial for news apps if they are to survive.
At Zaker, Li has worked hard to cultivate a distinctive brand since setting up the company in Guangzhou in 2011 with the help of $10 million in investment.
Today, Zaker has 12 million daily users and the majority of them are from first-tier cities in China, such as Beijing, Shanghai and Shenzhen. Most have at least a college degree, drive a car, buy luxury brands and travel extensively, according to company data.
"Eventually, each player will cover a specific group of users and provide news and content in line with their demand and taste," Li said. "That is what we are doing."
Toutiao is moving in a similar direction. Big data, a broad term for processing vast amounts of complex statistics, which can be boiled down into market and consumer trends, will be vital in working out the right strategy.
The company already uses 4,000 servers to crunch the numbers and will add another 2,000 by the end of the year.
"We first analyze all news content, label it and sort it by keywords," Lin, vice-president at Toutiao, said. "Then we analyze our users and match the content to their tastes."
This in turn should help drive customized advertising by matching the right brands with the right consumer, Wang Shicong, an analyst at Analysys International, pointed out.
"Advertisers are looking for a target audience and big data can do that," Wang said.
In January, Analysys International reported that the online advertising market in China grew 53.5 percent last year to 153.52 billion yuan compared to 2013. It predicted that the sector would grow to 319 billion yuan by 2017.
Zaker, which has yet to release detailed financial figures, generates most of its income from advertising.
But CEO Li is looking to expand the company's revenue base. In June, Zaker launched a range of new services, including online movies and travel packages.
"The news app sector cannot live happily ever after through advertising income alone," he said. "We have to explore new models and opportunities to grow in the future. You have to stay ahead of the pack."
