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Summary:

Getting paid on Android has been a touchy subject for developers, who have had trouble turning their apps into big money makers. But now Google has rolled out a new web store for Android Market and in-app purchases for apps that developers are hoping will kick-start revenues.

Screen shot 2011-02-02 at 12.42.46 PM

Getting paid on Android has been a touchy subject for developers, who have had trouble turning their apps into big money-makers like their iOS counterparts. But now that Google has finally rolled out a new web store for Android Market, support for local currencies, and in-app purchases for Android apps, developers are hoping to kick-start revenues.

The web storefront of the Android Market, first promised last May, brings the ability to search, browse and buy apps from a computer browser. Up to now, mobile apps would be purchased directly through the Android Market store on devices or through independent app stores such as AppBrain and GetJar. The new Android Market provides a very Apple-like App Store interface with categories, lists of top free, paid and featured apps along with screen shots and video demos. Customers who buy an app will have it pushed out to their device through a Wi-Fi or mobile broadband network. And they’ll be able to share links to apps in Android Market now through Twitter.

The other major improvement is in-app purchases for Android Market apps. Some payment providers like Zong and Boku have either deployed or tested similar systems on Android apps. But this is Google’s first move toward offering native support for in-app purchases for virtual goods and extra content inside Android apps. Developers who integrate the feature can offer one-click payments through Google Checkout or carrier billing from AT&T and T-Mobile. In-app payments will roll out to consumers by the end of this quarter. 

This is clearly the bigger announcement for developers because it brings a huge new revenue source to Android app developers. In-app purchases have proven incredibly lucrative to Apple iPhone developers, who now make almost as much money from such purchases as they do from paid downloads. Selling from within an app gives Android developers a new way to make money outside of traditional advertising.

Matt Hall, co-founder of Larva Labs, one of the early developers in Android Market, said to me today that he’s excited about the changes and believes they’ll help monetize new and older titles. Larva Labs has been sitting on a Facebook photo wallpaper app that Hall said will launch with Google in-app purchases. He expects to apply in-payments to most of Larva Labs existing apps as well.

“In-app payments look great,” said Hall. “It needs to be that almost any Android user should be able to purchase something with a click. Anything you can do to make the process seamless really helps with conversion.” Hall, however, is hoping to see more carrier billing options, suggesting that for some, it’s a simpler way to pay for things than Google Checkout.

Andrej Nabergoj, CEO of Outfit7, which makes a series of Talking Friends apps, said the new in-app purchase feature will help close the revenue imbalance between its apps on iOS and Android, which produces far less in sales for Outfit7. The company has recorded more than 60 million downloads on both Android and iOS. For its free apps on iOS, Outfit7 has been able to convert 10 percent of customers to the paid version of the apps through in-app purchases. That option will finally come to Android for the first time when Google makes it available, Nabergoj said.

“We have 20 million downloads on Android and it’s growing really well. But we have a really hard time monetizing it,” he said. “I have a lot of confidence that in-app purchases will help monetize that audience.”

Mike Breslin, vice president of marketing for game maker Glu Mobile, said the move to in-app purchases also plays to Android’s history of selling more free apps. Instead of trying to push paid purchases up front, Breslin said developers can stay free, get a lot of downloads and try and pick up sales later on.

He said freemium has been a huge paradigm shift in mobile gaming and it’s remaking parts of Glu’s business. Games like Deer Hunter Challenge and World Series of Poker are now making more money as freemium titles than they did when they were paid. Breslin said the move to freemium will not only help existing developers but should make Android more of a destination for serious game developers, one of the knocks against the platform compared to iOS.

“It’s really exciting news for anyone in the content business,” Breslin said of in-app payments. “Especially social mobile gaming companies like us, our entire games are built around freemium. When you can monetize a channel, it’ll bring better quality products and more often.”

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  1. Honeycomb: What You Need to Know (It’s Not Just For Tablets): Mobile Technology News « Wednesday, February 2, 2011

    [...] In-App Purchases and Local Currency. This is another feature of the improved Android Market, so it’s not specific to Honeycomb. That means smartphone owners will benefit from the new in-app purchase functions and support for local currencies. While these improvements will help developers potentially earn more revenues, they enhance the end-user experience as well. Want to buy additional game levels on the fly? No problem because it’s a simple, seamless experience. And consumers no longer have to worry about currency conversion rates either. Android developers are already raving about these new features, with hopes of boosting sales. [...]

  2. KingofthePaupers Thursday, February 3, 2011

    Jct: My first political poem:
    Why represent our collateral with their chips for a fee?
    When we can represent our wealth with our chips for free?
    And with every transaction done in your own local currency, the banksters get no interest. Every deal you do without using their cash, bankers get no vigorish. The more deals done in our own chips, the more the banks die. The day all local currencies adopt the Time Standard of Money (1 Ithaca Hour = $10US Greendollars) (1 German Hour = 20 Greenmarks) (1 French Heure = 60 Greenfrancs) then they will all be able to intertrade and the loanshark banks go bust. Har har har. The UNILETS Time Standard of Money kills the banks! Har har har. Who’d have thought they would be so vulnerable to being side-stepped to death?

  3. Android users are FAT GEEKS Thursday, February 3, 2011

    Goodluck! Android users don’t pay for software.

    Android Piracy is a HUGE problem.

    Android’s Serious Piracy Problem Costs Developers Big Money
    http://www.businessinsider.com/android-piracy-2010-8

    Android software piracy rampant despite Google’s efforts to curb
    http://www.networkworld.com/news/2010/092910-google-android-piracy.html

  4. Nokia’s Ovi Store has been doing all this for ages, on a much grander scale, to MANY more devices. You want to make money? Go there.

  5. KingofthePaupers Saturday, February 5, 2011

    “Getting paid on Android has been a touchy subject for developers, who have had trouble turning their apps into big money makers. But now Google has rolled out a new web store for Android Market and in-app purchases for apps that developers are hoping will kick-start revenues.”
    Sphinx Khan: Oh come on you guys! Android kicks ***. This is going to help the developers who make all those amazing applications.
    Jct: It’s going to help developers keep all their profits instead of having to pay interest to use bankers’ chips. Each transaction loses them their rake-off. Watch the banks die! Har har har har har har nyuk nyuk nyuk nyuk.

  6. Android This Week: Market Matures; Honeycomb Unveiled; Turbo Tablet: Mobile Technology News « Saturday, February 5, 2011

    [...] patiently to earn money from their Android endeavors and these new features should help. Indeed, initial reactions from Android devs are positive and may influence more apps to go with the freemium model. The base functionality is available at [...]

  7. Interesting Reading #680 – Europa mission announced, Nokia’s iPhone Killer, Taxi of tomorrow, world’s fattest nation and much more! – The Blogs at HowStuffWorks Saturday, February 5, 2011

    [...] Developers See Dollars In Android Improvements – “Getting paid on Android has been a touchy subject for developers, who have had trouble turning their apps into big money-makers like their iOS counterparts. But now that Google has finally rolled out a new web store for Android Market, support for local currencies, and in-app purchases for Android apps, developers are hoping to kick-start revenues….” [...]

  8. I don’t think this is an Apple or Android argument more than it’s a discussion on the best way to deliver apps to people. Apple took it’s own approach and Google tried something different. It didn’t work out exactly right so they are tweaking it. Nothing wrong with that. Nothing says that the Apple way of life works for everyone either (Palm Pre). I think the best thing is just that Google is listening to developers and customers.

    Ultimately OS’s won’t matter so much. In fact, they will probably get lighter and lighter as apps get more complex. Sure, you might buy an iOS or Android device, but what will sell you on that aren’t so much the features of the OS, but the apps you can get.

  9. Get rid of the damn 15 minute return window and put it back to 24 hours. I used to buy Android apps. A few I returned either because they sucked or didn’t do what they were supposed to do. Now, its just too fast to actually test the app before you decide to keep it.

    Frankly, I pirate the app first and if I like it, I buy it.

  10. Does these improvements have any impact on us? Yes, they do. We will be blessed with better features and facilities.

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