Making money with mobile apps

By Serdar Yegulalp, Computerworld |  Mobile & Wireless, mobile application, mobile apps

The ad-funded model

A third way to generate revenue from mobile apps is a method ported directly over from the Web at large: advertising. But be aware: Ad-supported apps come with all the controversies associated with using advertising as a revenue model, plus a few new ones.

Ad-supported apps can serve as a way to hook people into buying a full version of a program without the ads. For example, the MixZing Music Player for Android has a free, ad-supported version; pay $6.99 for the full version, and you not only remove the ads (which are at least unobtrusive), but unlock a slew of extra features, like an MP3 tag editor.

The problem with ads in a mobile application is -- for lack of a better word -- acreage. On an ad-supported Web page, ads can run in banner or skyscraper elements confined to the edges of the page and don't have to be as intrusive. With a mobile app, the small screen means any ad is going to eat into the UI, and a badly integrated ad will turn people off. Ads placed too near controls, for instance, may mistakenly intercept button-press actions.

Another small drawback to advertising in mobile apps: The ad system is all but useless if the user doesn't have an active data connection. This will become less of an obstacle as more mobile devices are sold with some form of data plan included and as municipal Wi-Fi becomes more pervasive. (Also, an ad can still be effective, even if it clicking on it doesn't work due to a lack of networking. As long as it raises some awareness in the mind of the viewer, it's still doing its job.)

Another method of monetizing through advertising is using revenue generated through a search engine. This has been Mozilla's model with Firefox and could just as easily be applied to mobile apps as well. Whenever a user executes a Web search via Firefox's native search box, a certain percentage of ad revenue generated from the search goes back to Mozilla through an affiliate program.

The downside to this approach is that it lends itself only to applications that have some search component -- such as a mobile browser -- which make up a very small segment of the existing app mix. That said, it's entirely possible that creative methods of integrating search with mobile apps will make search-engine revenue that much more viable a choice.


Because the current incarnation of the mobile apps market is still so new and only just now experiencing a flowering of cross-platform competition and innovation, the ways apps can be monetized and sold are likely to enjoy as much of a period of experimentation as the apps themselves.

Originally published on Computerworld |  Click here to read the original story.
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