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From the point of view of a developer, one counter-point is that the App Store still makes far more revenue than the Android Marketplace (about 17x more, to be

From the point of view of a developer, one counter-point is that the App Store still makes far more revenue than the Android Marketplace (about 17x more, to be precise), so iOS is still a better platform of choice [1]. A counter-point to that counter-point is that Android's Marketplace has far fewer apps than the App Store (about 4x fewer), and far fewer paid apps (about 2x fewer) [2]. That 8x factor still doesn't explain the 17x difference in revenue. My guess is that the typical Android app is of lower quality (since the store is not moderated) and lower priced in comparison to iPhone apps. At any rate, given this dramatic change in market share, it seems to me that not deploying for the Android platform at this point is a dangerous proposition, except perhaps if your primary customer acquisition channel is the platform's built-in store/marketplace. [1] http://techcrunch.com/2011/02/21/861-5-percent-growth-android-puny http://techcrunch.com/2011/02/21/861-5-percent-growth-androi... [2] http://reviews.cnet.com/8301-13970_7-20032228-78.html http://reviews.cnet.com/8301-13970_7-20032228-78.html

iaskwhy 16y ago
There seems to be a "small" difference between this and the Windows analogy: Apple got into the mass market this time and its users are showing money. If Apple can keep at least 10% of the market then it might as well have more than 50% of the people-that-actually-buy-apps market like you show. Let's assume this scenario of 50%. Then it all boils down to how better it is to develop to one platform against the other. And, to keep it in perspective, I didn't even mention the iPad here... I always thought Apple was going for the wrong strategy here, once again (like the article points), but I'm starting to doubt it.
- CoffeeDregs 16y ago
  >Apple got into the mass market this time and its >users are showing money. If Apple can keep at least >10% of the market then it might as well have more than >50% of the people-that-actually-buy-apps market like you show. At the risk of aging myself, I had an IBM PC in 1981 and watched friends get Macs. The quote above sounds as if it were lifted directly from that time period. The main difference between then and now is that the mobile market is already very large and relatively well explored. Apple's strategy seems nearly identical. Any of this sound familiar?: lots of overpriced peripherals; proprietary networking (see FaceTime); all new technology!... that then basically didn't change for 15 years (co-operative multitasking up until about '00); created the perfect interface and wrote a book about it!... then would only change about the interface in response to competitive pressure. I don't think Apple is going to have anything like 50% market share of phones or app purchasers. As the article pointed out, the mobile market is going to be won in developing countries and that's precisely where Apple can't play.
deleted 16y ago
[deleted]
evo_9 16y ago
I think it's simply that Apple/iOS users spend more money. IOS is the more mainstream platform and you have general/non-tech users on the platform buying relatively cheap apps, at least by their previous standards (they'd gotten use to 59.95 for a game software for example). In general I think iOS users just spend more money as a whole. Android seems to be favored by users that prefer free software and simply spend less as a group.
webwright 16y ago
There's probably a lagging effect in quality on Android. 8 months ago, a lot of mobile companies were spinning up. Android was a big question mark, and iOS was an obvious juggernaut. I'm imagining that a lot of resources have been thrown at Android apps over the past few months in anticipation of continuing growth. We'll see the fruits of that in the coming months.
timdorr 16y ago
Those are paid app revenues only, though. Because of Google's focus on advertising, that's becoming a very viable alternative method of revenue for app producers. Look at Angry Birds, who is bringing $1m per month on Android [1] and doesn't have to sell to as many new customers to maintain those numbers. Eventually, they're going to hit a wall. $.99 is great up front, but $0.05 a month from 5x the number of customers is better. [1] http://www.intomobile.com/2010/12/03/angry-birds-android-1-million-ad-revenue/ http://www.intomobile.com/2010/12/03/angry-birds-android-1-m...
- tjogin 16y ago
  Angry Birds on Android was launched off of the success on the iPhone though. Not that invalidates their success on the Android platform or anything, just that it doesn't speak to the power of the Android platform, since it probably would never have happened if not for their previous success on the iPhone. I.e. the Angry Birds story is not a good example of when focusing on Android rather than iOS would have been a good idea. Can you think of any Android exclusive app or game that is achieving a similar success? Then that app is probably a better example.
jawee 16y ago
From a perspective of the general types of apps sold on mobile phones to similar mostly one-function apps and games, I think the comparison to Windows vs. Mac holds through. On Windows, most of the smaller utilities and games are generally free and it is hard to sell them to the average consumer, whereas on Mac it is much more common to find small-scale projects that are commercial. This divide is only going to be more accelerated with new easier ways of payment for applications such as the app store.
tjogin 16y ago
Good points. Another aspect to consider is that some Android users don't even know that they are Android users. I don't know how many, but speaking from personal experience, it seems a non-negligible percentage of "normal" Android users simply bought a touch screen smartphone in the lower end of the market, because that's what carriers are pushing now. It's running Android, but the owner doesn't know it, and isn't familiar with any marketplace to download apps. iPhone users though, they know that they have an iPhone and what that entails. Meaning, they know what the AppStore is, and Apple has their credit card information. Some even had an Apple account before they got an iPhone — if they had an iPod previously they can just start buying apps right away. Counting users is one thing, but what you should be counting are active users of respective marketplaces/app stores.
Joeri 16y ago
Paid apps aren't very relevant in the long term though, for several reasons:` - It's a race to the bottom. New competitors enter and price their app lower to compete. Existing players are forced to adapt. Marginal cost is zero so apps eventually settle at the lowest possible price point at which there is revenue ($1). - People buy apps only once. Right now the market is growing, but once it has become saturated (everyone has a smartphone), sales for existing apps will drop to near zero. - Freemium always wins the low-end. The low-end doesn't pay for content, so the only way to reach them is to offer the content for free. Revenue is made through advertising or by up-selling after adoption. The web went free because it turns out the low-end is bigger than the high-end. If it's a given that the paid app market is going to dry up (and I think it is), then it's also a given that app developers will have to have a free strategy. Going free means having more eyeballs, because revenue per user is lower. So, you need to be on the biggest platform, and android is going to be the biggest platform. Why? Because google "gets it" and is spending all their resources into buying up market share, including the low-end (where most eyeballs are). Apple is not going to fight for the low-end, it's not in their DNA. Everyone else is simply not in a position to compete.

iaskwhy 16y ago

There seems to be a "small" difference between this and the Windows analogy: Apple got into the mass market this time and its users are showing money. If Apple can keep at least 10% of the market then it might as well have more than 50% of the people-that-actually-buy-apps market like you show. Let's assume this scenario of 50%. Then it all boils down to how better it is to develop to one platform against the other. And, to keep it in perspective, I didn't even mention the iPad here... I always thought Apple was going for the wrong strategy here, once again (like the article points), but I'm starting to doubt it.

CoffeeDregs 16y ago
>Apple got into the mass market this time and its >users are showing money. If Apple can keep at least >10% of the market then it might as well have more than >50% of the people-that-actually-buy-apps market like you show. At the risk of aging myself, I had an IBM PC in 1981 and watched friends get Macs. The quote above sounds as if it were lifted directly from that time period. The main difference between then and now is that the mobile market is already very large and relatively well explored. Apple's strategy seems nearly identical. Any of this sound familiar?: lots of overpriced peripherals; proprietary networking (see FaceTime); all new technology!... that then basically didn't change for 15 years (co-operative multitasking up until about '00); created the perfect interface and wrote a book about it!... then would only change about the interface in response to competitive pressure. I don't think Apple is going to have anything like 50% market share of phones or app purchasers. As the article pointed out, the mobile market is going to be won in developing countries and that's precisely where Apple can't play.

deleted 16y ago

[deleted]

evo_9 16y ago

I think it's simply that Apple/iOS users spend more money. IOS is the more mainstream platform and you have general/non-tech users on the platform buying relatively cheap apps, at least by their previous standards (they'd gotten use to 59.95 for a game software for example). In general I think iOS users just spend more money as a whole. Android seems to be favored by users that prefer free software and simply spend less as a group.

webwright 16y ago

There's probably a lagging effect in quality on Android. 8 months ago, a lot of mobile companies were spinning up. Android was a big question mark, and iOS was an obvious juggernaut. I'm imagining that a lot of resources have been thrown at Android apps over the past few months in anticipation of continuing growth. We'll see the fruits of that in the coming months.

timdorr 16y ago

Those are paid app revenues only, though. Because of Google's focus on advertising, that's becoming a very viable alternative method of revenue for app producers. Look at Angry Birds, who is bringing $1m per month on Android [1] and doesn't have to sell to as many new customers to maintain those numbers. Eventually, they're going to hit a wall. $.99 is great up front, but $0.05 a month from 5x the number of customers is better. [1] http://www.intomobile.com/2010/12/03/angry-birds-android-1-million-ad-revenue/ http://www.intomobile.com/2010/12/03/angry-birds-android-1-m...

tjogin 16y ago
Angry Birds on Android was launched off of the success on the iPhone though. Not that invalidates their success on the Android platform or anything, just that it doesn't speak to the power of the Android platform, since it probably would never have happened if not for their previous success on the iPhone. I.e. the Angry Birds story is not a good example of when focusing on Android rather than iOS would have been a good idea. Can you think of any Android exclusive app or game that is achieving a similar success? Then that app is probably a better example.

jawee 16y ago

From a perspective of the general types of apps sold on mobile phones to similar mostly one-function apps and games, I think the comparison to Windows vs. Mac holds through. On Windows, most of the smaller utilities and games are generally free and it is hard to sell them to the average consumer, whereas on Mac it is much more common to find small-scale projects that are commercial. This divide is only going to be more accelerated with new easier ways of payment for applications such as the app store.

tjogin 16y ago

Good points. Another aspect to consider is that some Android users don't even know that they are Android users. I don't know how many, but speaking from personal experience, it seems a non-negligible percentage of "normal" Android users simply bought a touch screen smartphone in the lower end of the market, because that's what carriers are pushing now. It's running Android, but the owner doesn't know it, and isn't familiar with any marketplace to download apps. iPhone users though, they know that they have an iPhone and what that entails. Meaning, they know what the AppStore is, and Apple has their credit card information. Some even had an Apple account before they got an iPhone — if they had an iPod previously they can just start buying apps right away. Counting users is one thing, but what you should be counting are active users of respective marketplaces/app stores.

Joeri 16y ago

Paid apps aren't very relevant in the long term though, for several reasons:` - It's a race to the bottom. New competitors enter and price their app lower to compete. Existing players are forced to adapt. Marginal cost is zero so apps eventually settle at the lowest possible price point at which there is revenue ($1). - People buy apps only once. Right now the market is growing, but once it has become saturated (everyone has a smartphone), sales for existing apps will drop to near zero. - Freemium always wins the low-end. The low-end doesn't pay for content, so the only way to reach them is to offer the content for free. Revenue is made through advertising or by up-selling after adoption. The web went free because it turns out the low-end is bigger than the high-end. If it's a given that the paid app market is going to dry up (and I think it is), then it's also a given that app developers will have to have a free strategy. Going free means having more eyeballs, because revenue per user is lower. So, you need to be on the biggest platform, and android is going to be the biggest platform. Why? Because google "gets it" and is spending all their resources into buying up market share, including the low-end (where most eyeballs are). Apple is not going to fight for the low-end, it's not in their DNA. Everyone else is simply not in a position to compete.