Why Android developers aren't getting paid

Finding the causes of weak monetization

Even as Android still continues to be the disruptive story in mobile marketshare, some industry analysts are continuing to point out the popular open source platforms biggest weakness: monetization.

A new story is popping out on the wires today from Business Insider, which reports that "for every dollar of iOS revenue, developers only get 24 cents from Android."

The article itself is based on an older Flurry Analytics report released last December, which at the time cited the number one cause of this disparity as transactional friction: without a seamless way to pay, users are less willing to slog through paying for an app in Android.

But in its follow-up report, Business Insider spoke with Peter Farago, VP of Marketing at Flurry, who also highlighted another factor that was holding Android back from making money for Android developers:

"'They don't have a curated store.' This is Farago's personal hypothesis. As a result of the platform's nature, Android has a less efficient app distribution model than iOS. Farago thinks consumers have been burned more on Android, or, as he put it, 'There's a lot of garbage on the shelf.'"

Is this feature really one of the reasons Android developers aren't making money? Farago certainly thinks so.

In a more recent Flurry report from March, Farago highlighted the amount of revenue per active user between not just iOS and Android, but broke the data down between three distinct app stores: the iTunes App Store for iOS, and the Amazon Appstore and Google Play stores representing Android. The Amazon Appstore is available for Amazon Kindle Fire users, which runs a forked version of Android.

Here, the results seem to confirm Farago's opinion about curation. For the months of Jan-Feb 2012, for every one dollar of revenue an iOS user spent, 23 cents was generated by an Android user using the Google Play store… and 89 cents was spent by Amazon Appstore users.

Which means, in terms of percentages, apps on the Kindle Fire are already generating nearly four times more revenue for those developers than general Android app developers. And this is after Google implemented some curation tools within the Android marketplace last year.

While Farago was willing to go on record about curation in the Business Insider piece, he still cited payment friction as the biggest hamper to Android's problems in his March blog entry. Apple and Amazon have far greater success running stores, whereas "[r]unning a store, retail or digital, has not been Google's traditional core competency," Farago wrote.

So how big of a factor does curation play? Looking at the results of Flurry's numbers, it's hard to imagine that curation isn't playing a role. Until Google Wallet or some sort of payment option is required upon initial customer configuration of an Android device, though, it's difficult to pull out the factors that can solely be attributed to curation and those that are caused by other market forces.

Results like this should at least spur Google to get it in gear and implement some better transactional tools. If Flurry's data is even remotely correct, then Android's poor revenue numbers will make it a no-brainer for developers to roll out their apps on iOS first. And no matter how many Android phones are selling now, if the apps suffer, users could ultimately vote with their feet for something from Cupertino.

Read more of Brian Proffitt's Zettatag and Open for Discussion blogs and follow the latest IT news at ITworld. Drop Brian a line or follow Brian on Twitter at @TheTechScribe. For the latest IT news, analysis and how-tos, follow ITworld on Twitter and Facebook.

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