I have my own opinions on this but need some arguments when talking with designers. What are the advantages/disadvantages of using caps for all words in mobile application design?
There are very few advantages to using all caps, and that is why we usually don't.
When we read text, largely what our brains are doing is recognizing the overall shape of words, rather than the individual letters. Lowercase letters have different sizes and visual densities; some have ascenders sticking up, or descenders sticking down. This means that looking at the visual silhouette of a lowercase word, and identifying at the first and last letters, is almost always enough to identify the word.
For all-uppercase words this is much less true, and reading a word requires looking at each letter. Words take fractionally longer to identify, and are misread more often, which reduces reading speed and requires more concentration. For the same reason it is also hard to find your place if you glance away from a large block of uppercase text. These problems are much worse for anyone with dyslexia or any kind of visual impairment, to the extent that using all caps for informational text may actually be illegal under accessibility statutes.
For what it's worth, some reasons you might use all caps:
for emphasis (but bold or italic or larger type are all preferable)
for graphical reasons – as sergiol says, capitalised words are basically rectangles and if it's just one or two words, the greater visual simplicity may be worth it.
for ancient Latin text (before lowercase was invented, carved inscriptions on Roman monuments used only capital letters)
to discourage people from reading a block of text – this is allegedly why some warnings on cigarette packaging use all caps, and also why the text is surrounded by a tight black border.
I gather that it is more common for Greek text to be set in all caps; I don't know why this is, and it may be for related historical reasons (the distinction between small and capital letters originates from the distinction between handwritten and carved text). I would assume the same arguments apply in Greek or Cyrillic but I don't know if there are other considerations there.
"What are the advantages/disadvantages of using caps for all words in mobile application design?"
Do you mean ALL CAPS ALL THE TIME? Or Capital Case Only For The First Letter?
- ALL CAPS looks like you're SHOUTING! Bad if there's no semantic reason for this.
- Can feel like it crowds other elements, especially on mobile where space is at a premium
- Less legible if longer than a few words - the rhythm & end points of words are obscured
- Not possible with many written languages
- In some languages, capitalization changes meaning or pronunciation
- Doesn't achieve the desired effect as well as alternatives that render it unnecessary
- It does appear larger/more important or emphatic.
- For stylistic appeal & uniformity in a headline or logo
- It would make Latin-text designs more similar to Asian text that has a uniform height.
Standing out visually can (and should) generally be achieved through other means: Use a larger font size, a heavier weight, or a darker/more saturated color. No need for capitalization unless it's semantically appropriate.
You might often see all caps in a logo precisely because it creates a more uniform shape or can be more stylized - but you asked about "all words." This definitely wouldn't apply in a general sense.
With many languages (E. Asian especially) you will wind up with the same "rectangle" of text as you would with ALL CAPS, because their characters have a uniform height/width:
Readers of those languages are used to that though - it would not be appropriate (or a good user experience) to force this uniformity on other languages that have variable heights/widths (most European & Middle Eastern languages). While Latin text has capital letters, Arabic and Persian scripts do not. Creating a uniform height even if you want to in those scripts is a matter of stylistic font selection.
Capitalizing Across a Headline, Etc.
Doesn't make a difference in English at least, as long as you're consistent. People are used to this approach in news headlines, but in other circumstances it's likely awkward.
Depending on the rules of the language, capitalization has a specific grammatical purpose for identifying nouns, proper nouns, etc. It's not just an aesthetic choice, but a semantic & linguistic one.
In German for example, if you write "essen" it's a verb (to eat), but "Essen" is a noun (food/meal). In English, "Bob" is a proper name, but "bob" could be a noun or a verb. In Arabic, which doesn't have "capital letters," a 'D' vs 'd' or 'T' vs 't' when romanized indicates a distinct pronunciation and different letter & sound entirely.
Point being: you shouldn't just change how words are spelled for aesthetic reasons.
Last thought ... if you really want to be sure what's right for your situation, you could adjust the case programmatically & test with your prospective audience. You can apply all-caps, first-caps, and small-caps to normal-case strings without having to actually change the underlying string data. See which one people prefer.
This is more of an algorithmic problem, but it is worth keeping in mind that some languages do not have the distinction of upper- and lowercase. E.g. Japanese (they also don't have the concept of bold text).
And some letters do not exist in an uppercase variant, e.g. the German "ß" ('sharp S') is a strictly lowercase letter1 as there are no words that start with it, and in all-caps is usually reduced to the (sometimes ambiguous) letters "SS" instead.
1) There have been designs for an uppercase letter in modern times, "ẞ", but it only recently got added to Unicode, is usually only found in the system fallback font, isn't easily typed on any German keyboard and isn't taught at schools, so in practice it might as well not exist.
A thing to consider is that "design", when use as a form of communication, should ease the process rather than hider it. For that reason I avoid using all caps from a typographical perspective. As Bobtato mentioned, our brains read by recognizing the overall shape of words. Not necessarily the individual letters. One of the biggest challenges that all caps present is to people with dyslexia (15% of the US population). Reading individual letters is difficult and frustrating. Many cannot see the shape of the intended word. If it's just a few letters they will work it out if they feel it might be essential to the overall meaning. If it is decorative, "seem" unimportant, or long it might as well not exist.