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The mobile app divide: Free rules on Android, paid rules on iPhone

Apple and AndroidThe two mobile platforms with the most apps are Google’s Android with around 95,000 apps, and Apple’s iOS with around 250,000 apps.

Those are impressive numbers, but this article isn’t about the sheer number of apps available. Instead, we wanted to focus on a very interesting distinction between the two platforms: The radical difference in the ratio between free and paid apps.

Free versus paid

They say that a picture is worth a thousand words, so let’s illustrate the difference between the two app stores with a picture and save us some writing:

The share of paid vs. free apps on Android Market and App Store

That’s quite a difference, isn’t it? On Apple’s App Store, roughly 70% of the apps are paid apps. On Google’s Android Market, it’s almost exactly the other way around, 64% free apps.

Why so many more free apps on Android?

Or from the other point of view, why so few paid apps on Android compared to iOS?

It’s certainly not for a lack of developers. There are surveys indicating that there are now more Android developers than iPhone developers.

But the fact remains: Far fewer Android developers are trying to sell apps compared to their iPhone counterparts.

There may be several reasons for this:

  • Money. Many developers are uncertain if Android is a lucrative enough market (we wrote about one aspect of this last week), although there have been voices raised to the contrary recently. The iPhone (and iOS), on the other hand, is an established platform with a number of high-profile success stories and may therefore to a greater degree be attracting developers wanting to make a profit.
  • Many developers are shut out from selling apps. Only developers from nine countries are allowed to sell apps on Android Market. Developers in other countries may therefore be much more likely to release applications for free instead of trying to earn some money from selling at a modest price.
  • More hobbyists? Perhaps the lack of an approval process makes it more likely for hobbyist projects to exist on Android.
  • Different culture? It’s quite possible that Android has attracted a higher share of developers from the open source and Linux world, who are used to making their applications available for free.

What do you think? Is there any one big reason why the ratio between free and paid apps is so very different on Android and iOS?

Data sources: App Store numbers from 148Apps.biz, Android Market numbers from AndroLib.



15 comments
Colin
Colin

Apple has done a great job of making it easy to purchase through your credit-card backed account, or your pre-charged account. They offer in-application purchasing while Android doesn't. For a developer it is easier to "abide by the rules" and develop for Apple - for example I have an application that uses in-application purchasing as a large part of its business and I can't simply port this to Android. I thought about implementing my own credit card payment system (through payment gateways) but then discovered how small purchases are used to validate that stolen credit cards are still enabled and how much it costs just to process a dispute even if it ends up in your favor. Apple did not have in-app purchasing for a long time, but eventually added it as a result of developer demand but only, I'm sure, after they figured out how to make money from them. So there is a developer need and a way to make money for the host. But as yet Android does not have this feature or, really, a good ecommerce system that is user friendly and consistent. So if app developers are discouraged from creating paid applications on Android then people are going to expect fewer paid applications, which then further discourages developers, leading to a vicious and downward spiral. Google really needs to focus on making a consistent and user friendly payment system to rival Apple's App Store. Then the playing field is level and we'll see if the same balance of free to paid exists across the two platforms. Of course, Google doesn't need to make a consistent and user friendly payment system as they're clearly making a ton of money, but it sure would be nice if they did.

vagvag
vagvag

i am an android developer from Greece, i can not sell , i can not buy paid apps from the market ... end of story

Marcus
Marcus

Nice article, but I also think you need to factor in the actual number of downloads. Gartner Dataquest released figures earlier this year that said over 80% of the app downloads are free (see http://www.gartner.com/it/page.jsp?id=1282413). So maybe there are a lot more paid apps, but fewer people actually download the paid apps.

Mike11
Mike11

Well, I think maybe the biggest reason for more free apps on Android is the complicated payment situation (both historical and now). Even 2 years later you can only buy and sell apps in a small percentage of countries where Android is offered. Also the payment ecosystem itself was and is very inconsistent. When the Apple App Store started there was already a year-long established and trusted payment system in place with Credit Cards, gift cards etc. and a lot of users already had an account. So worldwide it was and still is way easier, even for users who are allowed to pay for apps, to actually do so and in response for developers to charge for apps. Other than that I agree with your listed reasons. (perceived) money making opportunities and different app development culture ("open" camp and because of Java; Objective-C developers were more used to charge for programs).

TL
TL

Surprisingly, the article does not mention that there are actually more free apps in the Apple Apps Store (30% of 250,000 or about 75,000) than in the Android market (64% of 95,000 or about 61,000). Besides that, many of the Apple apps are $3 or less. I have no problem paying that amount for something I will use. Give me better quality and useful apps at a reasonable price. Free crap is of no value! I'm not saying that the Android Market doesn't have good free apps...I don't have an Android device and have only lightly browsed the Market. But let's not over emphasize free when the issue for most users is value for money.

Laura Beth MacDonald
Laura Beth MacDonald

I think part of the difference is what options are available and what the mobile apps are for. Even on the iphone there are many free options or versions- especially if it is connected to a store. I think the big thing now that the mobile apps and the internet are the biggest and easiest ways to increase a company's business. A good option is to hire a digital marketing agency to take care of this for you, like New York's Resolute Digital. They produce high quality results and really know what they are doing. I worked for one of their clients and was really impressed by them.

Daniel Eran
Daniel Eran

Apple primarily sells hardware. To do that, it needs a rich software and content ecosystem (iTunes), even if it doesn't make much money on it. It's still critical to selling hardware, because if you can't run apps or play commercial movies / music on the iPhone/iPod/iPad, it's not going to sell under competition from platforms that can. Google sells ad/search placement. To do that, it needs a venue for posting ads, even if it makes no money on hardware or the software platform. Google clearly isn't worried about selling hardware (look how quick it threw in the towel on the Nexus One) and doesn't care about Android as a platform (which is why it's promoting Chrome OS, isn't hosting app store sales in most countries, allows rampant theft of Android apps, and plumps app numbers by allowing tons of titles that are nothing more than a ringtone or wallpaper. It doesn't really take lots of analysis to determine why Google's platform is single-mindedly aimed at publishing Google ads, while Apple's is targeted at doing everything it can to sell hardware. Apple has 30+ years of running consumer hardware platforms. Google has next to nothing, and there is no precedent for a successful software platform built upon ads. None. There are lots of ad-supported failures to look back on however. This does not bode well for Android.

BooleanMaster
BooleanMaster

Because there's more money in free apps. It's all about volume.

Jim
Jim

Looking at the graph, since there are two and a half times more iOS apps, the smaller proportion of free apps translates to as many, if not more, actual free iOS apps compared to Android. Google's entire revenue model is based on advertising Ng and Apple is attempting to cut out Google with IADs. I prefer to buy an app than see advert clutter (I also use Click-to-Flash on my laptop. This way you pay the developer (70%) and directly show support. Over time, I hope there will be more paid apps on Android as the quality of games and apps on iOS is better.

Koe
Koe

Apples store is simply higher quality.

Nitya
Nitya

To really evaluate this statement in the context of the maturity of the respective markets, it would be nice to look at the paid/free split based on age similarity -- i.e., what was the split on iOS vs. Android if we look at each at their respective 2-year marks. I think Android will always have more free apps because it can - i.e., anyone can upload an app so hobbyists will. The curation in place for iOS means that while more apps are developed, not all make it in - so perhaps developers who put in the time/effort to make the cut are more likely to want to get compensation for it.

Manuel
Manuel

As far as I know, not only is the developers are shut out from selling apps, but also buyers can only pay within the Android Market from 13 countries. This might also lead a developer into the decision of not taking money for the app, to reach more popularity and maybe more indirect income by ads within the app.

Ed
Ed

I think that it could be due to the niche that is trying or did get far away from iPhone and it's ability to command you to what you must have as opposed to what you really want. Look at the iPad. It's just a large iPod. No cam. I mean, why no cam? ...next update.... Oh man.

cakedog
cakedog

Great article, very interesting. Of course, it might also be that Android developers prefer the advertising model, rather than charging. Much harder to get stats on how many people are advertising. But there definitely seems to be a difference between android users and iPhone users willingness to pay.

n1
n1

Interesting points, and all valid, especially the culture / hobbyist ones. One additional consideration is the technology lifecycle. When Apple started their application store, the primary revenue model was paid apps as the mobile ad industry was still in its infancy. The Android market launched a few years later after mobile ad platforms had a chance to flourish on the iOS platform and quickly transition to Android. This gave the Android developers a different revenue source than paid apps - embedding mobile ads into their application.

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