Most Google Android Developers Not Making Money
Google Android developers are saying having three versions of the open source operating system -- Android 1.5, 1.6 and 2.0 -- kicking around is a problem. The disparate phones and their custom firmware are also issues. But Android developers are unhappy for other reasons, according to a small survey taken by Skyhook Wireless in October: money, or the lack of it generated by writing Android apps for consumers to purchase. The navigation software maker sampled 30 Android developers and found that 57 percent of developers said they are not satisfied with their profits on Android. So 16 out of every 30 programmers are disgruntled about their Android apps earnings. That doesn't bode well for Android. Of course, 30 people is so small a sample as to be almost negligible -- there are thousands of Android developers who have built more than 15,000 apps -- but if the trend holds true across the majority of apps makers, it's very disturbing. Other highlights underscore a dim trend, with some more meaningful than others:
What disturbs me here is the high number of developers who dislike the design of the Android Marketplace. This marketplace was just redesigned in early September! "Often, apps will be released and quickly buried by other apps, and difficult to find again," Skyhook found. Worse is the almost 70% of coders who don't want to keep iterating on the Android apps they do write. That's a recipe for disaster. Skyhook concluded:
Today, developers are not generating real revenue via Android apps. This is the result of very low average download volumes, a poorly designed market, lack of an effective customer billing system, and the incapacity to serve ads. Due to these low profits, developers are becoming hesitant to invest more time and effort into apps that do not pay off....And now, anticipating the release of over 50 Android devices, many Android developers fear that fragmentation will squander the opportunity for widespread app distribution. This sounds like more of the same. AdMob, which Google is buying for $750 million reported back in August -- before the launch of the Motorola Cliq, Sprint HTC Hero, Motorola Droid and HTC Droid Eris -- that Android developers were making peanuts compared to Apple's iPhone apps developers. Google Android application developer Matt Hall from Larva Labs supported this theory and said it might be worse than anyone actually estimated. I am at a loss as to what this means for the future of Android. On the one hand, Android phones are coming fast and furious -- there's about 15 smartphones, from the clunky G1 to the myTouch 3G and the solid Droid and Droid Eris. On the other hand, if developers begin to throw in the towel on Android, Google might as well pack in the Android Market and just offer its own services, which are pretty darn good. Indeed, Skyhook notes Android developers remain excited about the potential for the platform:
These survey results are a snapshot of the current state of the market, and as more Android devices are released monetization options may improve. What these survey results show is that the Android platform faces serious challenges. In order to retain developer enthusiasm, Android must develop effective methods for app monetization. Otherwise, developers will lose interest in the platform, and focus their resources where they can best monetize their apps. In other words, they may go where the big money is -- Apple's iPhone. |

Comments (17)
apple store is the abnormality rather than the trend. the age of making hundreds of thousands of dollars off relatively simple programs is OVER. apple struck the gold mine of young, hip, money wasters. android's audience are relatively conservative when it comes to spending $$$ on apps like iFart. it doesnt mean android has inferior technologies. it just means mobile app market has reached maturity like PC apps.
Lastly, every one of these app makers would go to apple if they could make money. no one restricts themselves to just one platform out of ADMIRATION. the truth is only the top iphone apps are big money makers. the 30 app makers are crowded out of the market and HAD to go to android.
In short, stop whining and make better apps.
Posted by Ray | December 1, 2009 12:50 PM
Clint,
Everyone knows that there are more iphone handsets than android handsets in use at present. But all the projections show sales of android phones far outnumbering iphones by 2011.
Could it be that software developers, being rather clever, are aware of this data trend, and are thinking of the future?
One more: Clint, are you in any way remunerated by Apple?
edj
Posted by Ed Jurkevics | December 1, 2009 1:17 PM
Ed:
Good points. And, no, I currently use the Droid and love it.
Posted by Clint Boulton
| December 1, 2009 1:20 PM
I have to say that although these are valid points, I think the most important fact right now is the POTENTIAL that android has, rather then the current market share. It's gaining momentum quickly. Not all App store developers for Apple started off making tons of money, most things started off free and once the store gained popularity and credibility, and the iPhone was adapted by millions and millions of people, then developer firms started churning out "app store blockbusters." What I feel is that often many of the the Android early adopters, and the ones that are catching on now... are also big tech people that like gadgets and new operating systems. These same people, myself included, really appreciate the innovation and the amazing things developers are doing...and I'm sure would be more than happy to pay for the apps. There are some apps in the Android market that are LIFE changing for cell phone use, I would be MORE than willing to pay 99 cents, or heck even 5-10 bucks for it. Right now a lot of devs do the "Donate" version, and although thats great and I'm sure they make some money, once they make the price a dollar, instead of one free one donate, then the price of admission will cause many people who simply want the app, to have to buy it. The refund policy of android is amazing, so any buy is no risk. Also, for the future, things like in app purhchasing similar to apps in the iphone, once the platform is huge and adopted by the general consumer, this will be a great opportunity for revenue.
As for different phone platforms, I think it's absolutely a downside, but also a large plus. For developers, although changing versions and tweaking many different versions is tedious, it's also interesting and challenging. Some phones have new and amazing features that devs can do AMAZING things with. What I think should happen, and of course IMHO, is that Google should develop a better sorting method where developers can submit their apps into different device categories. That way, they can submit a Droid version, a G1 version, etc etc. So each phone can go to their section and see even more personalized and specific apps. Better for consumer, and developer. Look at Blackberry...apps are terrible, and much too expensive. But if you go on crackberry.com, you select your device, and you're shown all things for that phone. Much easier. If that was how the Blackberry App World worked, and the apps weren't so outdated and expensive, then it would be a phenomenal market. Android's future?
Posted by Scott | December 1, 2009 1:22 PM
That is why open source anything isn't really all that great and why Linux hasn't even made a dent in the OS arena. To many flavors of the same thing, this confuses people, ecspecially non-techie people. This is why Android is a niche player in the market.
Posted by MrWhite | December 1, 2009 1:35 PM
The average developer for the iPhone is NOT making any money either obviously because there is way too much competition; you've got to standout and above over 100,000 apps.
Although the average Android developer may not be making any money, they have better odds in earning a profit compared to the iPhone market. If you think an app is easily lost among 10,000 apps, imagine how virtually invisible your app would be among 10 times as many apps!
The Palm Pre app catalog is where the money is at for now until the iPhone decides to reduce their number of apps by eliminating thousands of their ignored and useless apps.
Posted by prepare | December 1, 2009 1:35 PM
I don't disagree with some of the criticism, but these surveys being cited were taken before Droid sales took off. Droid alone will be adding a million new Android based phones by the end of the year. The Android ecosystem is still in its infancy compared to the more well established iPhone. As an end user I would like to see the Android Market greatly improved. The second major issue I see is that Android apps currently cannot be installed/run from the SD card.
I think it is way to early to pass judgment on how successful Android will be, certainly developers who ONLY create apps for Android might be at a financial disadvantage now, but I think it would be foolish of any of them to ignore Android.
Posted by ScubaSteve | December 1, 2009 1:48 PM
Well what are the expectations? 100% happy with the amount of money they're making? Isn't the statistic that 5 out of 6 new businesses fail in a year? Well if 43% of these developers are succeeding, then that is 2.5 times the expectation. I don't see how this is bad.
Really, some more comparison and background is necessary for the stats in this article to mean a thing. How does this compare to the iPhone store developers? Have these same developers had more success on iPhone? Do they compare to successful iphone developers in terms of demographic, experience, and resources?
Anyway thanks for looking at real numbers rather than falling into the trap of getting swooned by Android's "potential". Every shiny new technology and its brother has had a nice hockey-stick projection since the beginning of time, and tons of them still fail. Reporting on the hypothetical hockey-stick adds no new information. Usefulness, not buzz, determines the eventual success of a product.
Posted by Dax | December 1, 2009 1:54 PM
In my opinion there is nothing wrong with the hardware. The issues are of a lager picture. The services and carriers are at war with each other at the cost of the consumer. Carriers have no support for the end user except for costly bills which reward the end user with a negative experience.
Where is the support for advancement and where are the tools that benefit? Carriers have to generate life out of innovation and can't afford investing in the experience of the consumer at the moment. This is something to do with good technological hardware meeting service upgrade and expansion friction. To provide the ideal situation of world wide connection with superior speed and performance a collaborative effort needs to be sought out within American network providers. Power innovation for generating high speed networks needs to be met first. As we have all experienced the fragile juice of electricity is the divide between a working innovation and just another piece of plastic. The power of human communication, language, and evolution of this era is upset with age old limitations of resource and environmental pollution. History lessons, like matter, are never destroyed they change form. In other terms we have built a great house and now have to change the foundation. Setting the example for ideal networks is lost, unless those with the opportunities to work together and create such a feat of our time can all synchronize their individual efforts.
The power of our generation is making sure we are using what works and not what will come to haunt us several decades later. The world is waiting for America to get down to business and start working together. Terrorists win if we can not provide solutions for them that work humanely. Communication is a big part of that connection: it wins wars, promotes understanding, and builds pyramids. Like everybody else; I know pieces of the issue, but don't have the answers to the problem. That will take far more community like minded thinking.
Posted by Dan | December 1, 2009 2:10 PM
@Dax
I agree with everything you said, but as far as potential being a pseudo prediction tool, I think that potential and buzz is often what brings something to popularity, and then if it lives up to hype and IS useful as you said (such as what it seems Android 2.0 is), then that same hype and argument for potential is what then turns into the driving force for sales and development. There have been many "useful" things that never got off the ground because not enough people knew about it, and it wasn't marketed well to get this hype. Clearly the buzz and the physical product itself work together in order to become a successful product. Very similar to what you said, just wanted to clarify my thoughts!
Posted by Scott | December 1, 2009 2:21 PM
1 The Droid is most likely Linux users and such... while the Iphone is the windows and Apple users. I dont expect to pay anything for any APP so i only download free apps, as many others. Also 15000 apps, are you kidding me there has to be a few copies of the same app, we don't need 20 different ways to make farting noises. I think this is a good step in weeding out some of the useless apps
Posted by Spikes2020 | December 1, 2009 2:24 PM
All the bashing of the AppStore is just bitterness. It's really well though-out and works really well. Apparently. The most defining variable to look at is amount of money spent on apps per phone user. And here the AppStore outshines the competition with their integrated business model.
I'm talking as an Android developer here. We want Google to bring the spenders and then, however which way you put it, it's always going to be a fight for the money among the developers. Yeah sure, today you have to stand out among 100.000 apps in the AppStore and only 10.000 on the Market, but there's a reason there's only 10.00 apps in the Market. You're won't make any money there! The statistically calculated ROI from putting your apps in the Market is still lower than the AppStore. And if we take into account the extra man-hours having to be put into making your apps compatible with all the different Android devices the ROI will be even lower.
Mind you, I am still very optimistic towards the Android platform but I think a lot has to be done to make the competition fairer between the iPhone and Android. You can't just put this thing out there and hope for the best, you have to take control of the platform and show the way. Google, are you listening?
Posted by Christoffer Du Rietz | December 1, 2009 3:41 PM
Dude,
Those apps should be free man, what do you think free software is?
I can get it for free, why do you expect me to pay you for it?
Posted by Bernard | December 1, 2009 4:10 PM
You know, I think Spikes2020, Christoffer Du Rietz, and yes even Bernard have good points. There are two major sticking points for Android right now.
Yes, some of the early adopters come from an open source background where sharing and collaborating is often times considered a free no-cost endeavor. So, yes, the Bernards of the world are a sticking point.
But secondly, and what I think is most important, is the fact that the user interfaces of the App Store and the Android Marketplace are competely different. The ease of use for the iPhone/App Store pairing is SO EASY, that it is easy to engage consumers. Not so for the Android Marketplace - laugh if you want, but it is not as intrinsically optimised for the lay person.
And hence, they have less dowloads and makes less money.
Posted by unemployedanalyst | December 1, 2009 5:32 PM
Going back to Clint's original posting, and giving the matter some more thought, the overall situation is bleak.
The problem is that the barrier to entry for both iPhone and Android apps developers is extremely low. Hack out an app, post it, and you're in biz. No need for marketing, management, VC, a bizness plan. Every two-bit coder is now an entrepreneur.
Outcome: a torrent, a veritable blizzard of apps, piled so deep one upon another that almost nobody can reach any reasonable scale of revenues. And users are so overwhelmed by the choices that they are frozen in place. Until solid app-brands emerge, consumers will be wary of all apps.
This is going to be an ugly marketplace for developers for a long time, no panacea. And I mean both the iPhone and the Android spaces.
-edj
Posted by Ed Jurkevics | December 2, 2009 10:10 AM
As a G1 user, and a daily browser of the latest Google Apps, I would definitely buy apps if the charges went directly to my T-Mobile bill. There would be impulse purchases, waste of money purchases, and everything in between, but since I'm not signed up with Google Checkout, that stops me from buying.
I'm sure it's not all that difficult to sign up for Google Checkout, but with hundreds of passwords and logon names to remember already, I tend to not sign up for anything now that requires me to create a new username and account setup. It's got to be absolutely required (my bank, my online stock brokerage account)before I'll bother registering anywhere.
Posted by Dharma | December 2, 2009 10:18 AM
Apple's ace-in-the-hole that hardly anyone in the tech press talks about or even acknowledges is the iPod touch, which accounts for over 40% of the iPhone OS usage. Discussing the installed base strictly in terms of smartphone users and iPhone units dramatically undercounts the market reach for the iPhone apps.
The iPod touch is basically a $200 handheld computer and media player that does not require any contracts or service tie-ins. Android and the other smartphone platforms tie back to service providers with monthly charges. They lack any sort of standalone option for those consumers that don't wish to switch providers or commit to a two-year contract.
The variety of Android phones that analysts think will help vault the platform ahead of the iPhone also create a fragmentation that will create a drag on app deployment. Fragmentation is already occurring with Android, and that's with a very limited number of models on the market. What will happen when the 50 or so Android models due to come out in the next year finally hit the market? Yet, even if combined Android sales surpass the iPhone by 2012, it will still remain behind as a platform until it also surpasses the installed user base that includes the iPod touch.
Posted by Woochifer | December 22, 2009 10:21 PM