November 26, 2014

Making Money is Hard Work

moneyA recent thread in the [android-discuss] Google Group has brought up, again, the question of “Will Android apps every [sic] make proper money?”. Compared to past threads on this topic, this thread is pretty good on the whole, so far at least. One person posted a list of “grievances”, though, that warrants some analysis.

The market for Android applications, right now, is a niche. It’s a nice-sized niche, probably over 3 million at the moment, but it’s still a niche compared to other possible markets. However, there is little about the market for Android applications that makes it structurally inferior to markets for applications for other platforms. There could be more to make Android better than other markets, but it’s not light-years worse, either.

With that in mind, let’s tackle the posted “grievances” one by one, comparing the poster’s perception of Android with the markets for Windows software, Web apps, and iPhone apps:

Exposure

  • Android: “limited exposure in Android Market in terms of presentation, global exposure and payment options”
  • PC: zero exposure except what you generate yourself (the techniques for which are well-documented and are also available to you for Android apps)
  • Web apps: same as PC
  • iPhone: better than Android, but not perfect if you listen to the complaints from the iPhone developers

Piracy

  • Android: “rampant(?) piracy”
  • PC: rampant piracy
  • Web apps: piracy impractical in most cases
  • iPhone: no significant piracy that I am aware of, counterbalanced by the problems getting your app onto the device in the first place (e.g., iPhone App Store gatekeepers) — probably a net win for iPhone by a bit

Ads, Part One

  • Android: “unreasonably high entry level to AdSense”
  • PC: AdSense not an option, AFAIK
  • Web apps: AdSense may be an option (reading the T&C’s, it feels like they want content sites, not app sites, so I’m not 100% sure)
  • iPhone: same as Android

Ads, Part Deux

  • Android: “unsophisticated integration of ads in general”
  • PC: ad-based software hasn’t proven itself to be useful outside of perhaps games (e.g., does Opera even run ads anymore?)
  • Web apps: better than Android
  • iPhone: same as Android, AFAIK

Payment Systems

  • Android: “restricted ability to set up one’s own payment system at an dev-operated back”
  • PC: no limitations here
  • Web apps: no limitations here
  • iPhone: worse than Android, since with Android you can at least distribute your apps through other markets and run your own payment system

Micropayments

  • Android: “lack of in-app micro-payments”
  • PC: no limitations here, though I’m not aware of this model being used much outside of games, at least for purchasing stuff from the app developer
  • Web apps: same as PC, though probably a bit more widely used
  • iPhone: recently added feature, haven’t heard good or bad about it yet

Google

  • Android: “Google releasing apps, squashing independent devs in the process”
  • PC: same as Android in principle, though in practice Google seems to do less for the desktop
  • Web apps: worse than Android, since Google tends to do Web first and mobile second
  • iPhone: same as Android (some apps are Android-only, counterbalanced by some apps being made for iPhone first)

Now, I look at that roster of “grievances” and I do not see how Android is dramatically worse than other likely options. Some of these can be dealt with by individual developers (e.g., worried about piracy? use DRM). Some of these are intrinsic to mobile (e.g., others are more bullish about ad-sponsored apps than I am). Android can certainly be better, but IMHO it is not terribly worse than the alternatives.

What some developers seem to forget is that selling apps and making money is hard work. Not everyone succeeds. Even in land-rush scenarios like the iPhone App Store launch, there are winners and losers, and those scenarios don’t last forever (e.g., the iPhone land rush is long since over).

So long as Android developers remain fixated on selling individual apps to individual users via an individual market, those developers will need to do lots of outside marketing, to make sure their target audience knows about the app. The Android ecosystem could use a bit more help in this area, of course. And, as I pointed out in a recent blog post series, there are other ways of making money than selling individual apps to individual users via an individual market.

But if you think selling for Android is bad, try writing a Windows app, uploading it to just one Web site, doing no other marketing…and see how many copies you sell there.



  • http://www.polyclefsoftware.com Derek

    I think the title of this article basically sums this up, but as an indie dev who's been trying a variety of strategies to make money in the Android Market for the past ~6 months I'd like to address some of these points as well.

    On ads, even if you don't meet the AdSense beta requirements, it doesn't hurt to apply. And guess what? There are other mobile app ad providers besides Google. I'm currently in the AdSense beta, but for the six months prior I used AdMob, with generally decent results. They've got an SDK specifically for Android, and it's very easy to integrate ads into your apps.

    On piracy, it's very difficult to measure the extent and impact, unless you either embed some analytics in your app or have a client/server app that tells you how many users you have vs. how many purchases. I'd be very curious to see someone try to measure the extent of piracy on Android, especially vs. other platforms such as the iPhone. I personally think strategies such as in-app advertising or giving away a free client but charging for server access are going to be essential for success on the Android platform, as ways of mitigating the effects of piracy.

    I'd agree that the market still needs a lot of work. I'd still like to see:

    *alternate purchase options, esp. charged directly to your wireless bill
    *a better official website front-end for the Android Market
    *expansion of the ridiculous character restriction on app descriptions

    But Google has made incremental improvements, and all in all I'm reasonably happy and very optimistic going into this holiday season with an avalanche of new devices coming out.

  • http://intensedebate.com/people/commonsguy commonsguy

    Hopefully it's not an avalanche. That might hurt! ;-)

  • joey

    well said.. It is not easy at all to make a living off the market. If you do develop a successful application, chances are you will create competition.
    If you make it too successful, if not android, the device makers themselve will bundle the same app with the device ultimately. Either ways you are guaranteed to see it become harder as time goes by.
    Shelf life for ideas on Android is probably 6 months to a year, after that you are better off moving on to the next idea.

  • Yoni

    I'm going to try not to be too harsh here; it's a good set of points overall… but "no significant piracy" on the iPhone? Seriously, Mark? Have you ever talked to any iPhone developers? Every single paid app developer I've ever spoken to has told me most (some as high as 95%) of their users are running pirated copies of the app. It wouldn't have been hard to do even a little preliminary research; a quick googling for some articles about it would tell you (see http://ps3computing.blogspot.com/2009/07/iphone-p… , for example). I'm sure you could have also very easily found an iPhone developer to actually tell you some platform facts so you wouldn't have to just make random guesses :)

    Of course, that doesn't mean that those 95% of app users who pirated a given iPhone app would have paid for the app if they weren't able to get it for free — just that piracy is as much, or probably *more*, of a platform problem on the iPhone compared to Android.

  • http://www.fuligin.com WWenthin

    I have not published an app yet but…. What type of tools are there on the marketplace to determine who has installed your app? Anything? My current app requires a backend and you must connect to it to play. I will know who is playing but how would I be able to determine if they have paid if I cannot run my own registration and payment?

  • http://www.polyclefsoftware.com Derek

    @WWenthin

    I use Flurry analytics:

    http://www.flurry.com/index.html

    It's extremely easy to integrate into your app and gives you all sorts of interesting information. You can then compare your sales numbers to your number of users via Flurry to determine the mismatch.

    I was hoping at some point that Google would implement their analytics for Android. Maybe someday. Until then, Flurry is great.

  • http://soft.antonspaans.com Streets Of Boston

    The title of the post is saying it all.

    Don't expect to become rich of your app by just putting it on a market, any market. You yourself have to market it. Ads, word-of-mouth, apps for professional niches, etc.

    Of course, some lucky b*tards will get quite rich by just posting an app to a market, but these are rare exceptions.

    I thought this was an interesting pod-cast about this issue (iPhone dev talk)
    http://www.mobileorchard.com/podcast-warm-clothed

  • http://intensedebate.com/people/chuckfalzone Chuck Falzone

    Regarding “lack of in-app micro-payments,” is there anything restricting developers from doing so in an Android app? Or just that no one has?

  • http://intensedebate.com/people/commonsguy commonsguy

    The difference is that with Android, installing a pirated app is not significantly more difficult than installing a non-pirated app. With iPhone, unless you jailbreak, I don't know how you get the pirated app on the device. The blog post you link to indicates that ~1000 jailbreakers grabbed the guy's game. This is no way, shape, or form indicates that 95% of iPhone users are capable, let alone willing or interested, in running pirated apps.

  • http://intensedebate.com/people/commonsguy commonsguy

    You'd need to do something that fit within the Android Market terms and conditions, if you distribute that way. It's unclear whether a micropayment system is possible given that restriction.

  • http://www.icents.net Marc Glasberg

    I would like to ask Mark and everyone else to visit our micropayment platform, and tell me (replying to this comment or by email) if you would like to have it ported to the Android:

    http://www.icents.net

    iCents.net could work for in-app micro-payments, even if a micropayment system is not possible under the Android Market terms and conditions.

    Thanks!

  • http://intensedebate.com/people/commonsguy commonsguy

    Your technology is interesting. If you can strike a deal with Google to have them publicly endorse iCents for Android in-app purchases, that would be huge. Lacking that, I advise any Android Market-using developer to seek qualified legal counsel to determine if, indeed, iCents complies with the Android Market terms and conditions.

  • Matija

    This is the first time I’ve heard of rampant piracy on Android. I follow Android news quite diligently, but I’ve yet to see any info on availability of pirated stuff. My carrier doesn’t yet allow paid market apps, but all the apps on my phone are legal and I bought TouchDown (the exchange mail app) from it’s producers, because they offer that possibility. I’d have bought Robo defense as well, but AFAIK they only support sales through the market.

    Conversely, a coworker has an iphone, jailbroken, and all the apps he has on it are pirated. He tells me there’s an app you can put on a jailbroken iphone that automatically breaks the DRM an uploads the pirated iphone app to a pirate server. So it looks to me like you got the piracy situation backwards…

  • jeremy

    Hmm,

    I can see the notes for supporting multiple screen sizes (small, normal and large) http://developer.android.com/guide/practices/scre

    But the only ref to different hardware was to buy the device and test on it. That's was my point, yes? Leave the compatibility testing to the developers? They've got nothing better to do, right?
    http://developer.android.com/guide/developing/dev

    There's also the kinda laughable UI guidelines "The Android UI team has begun developing guidelines for the interaction and visual design of Android applications". 4 pages. Wow.
    http://developer.android.com/guide/practices/ui_g

    iPhone UI guidelines? I stopped counting after 150 pages.
    http://developer.apple.com/iphone/library/documen

    Way to go people, release Android, what a year ago? and _then_ develop your look and feel. All the design i was taught was to get the look and feel done, then release the sdk. Helps consistency for the end user. The apps look and behave the same way from the get go. Makes it easier for the devs too since they know what to work from and not have to change things when the guidelines change. Also means if the dev has no idea about UI they can follow the guidelines and not have to subcontract out the interface to come up with a useable app.

    Shows how Google feels about design, useability and consistency i suppose. Comparing both SDK's really shows the iPhone maturity and depth. It's not about features people, or "open-ness" it's about how easy the phone is to use.

  • itcrespo

    And it seems to be easy to manipulate android builds, take a look at this tutorial

    http://lulachronicles.blogspot.com/2009/11/how-to

    I want to make some money with games, do you know what is the best option? IPhone, Android, Blackberry, J2ME?

    cheers

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    it is hard.. but this is a nice way of tought..

  • http://blogtext.org/autoforex/ autoforex

    I think, android market is future of mobile market in general but not earlier than 2015.

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    “my God, i imagined you have been heading to chip in with some decisive insght at the finish there, not leave it with ‘we leave it to you to decide’”

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