Paid Android apps get the cold shoulder from consumers

Jason ANkeny

There are now over 200,000 applications in Google's (NASDAQ:GOOG) Android Market--and the 100 million Android device users across the globe don't give a damn about half of them. According to new data published by app marketplace analytics firm Distimo, a staggering 80 percent of all premium Android Market applications and 20 percent of free apps have been downloaded fewer than 100 times worldwide. Only two premium Android Market apps currently exceed the 500,000 download milestone, while six paid iPhone applications in Apple's (NASDAQ:AAPL) App Store yielded the same number of downloads within a two-month timeframe in the U.S. alone. And while five Android Market games top 250,000 global downloads, 10 iOS games generated more than 250,000 downloads in the U.S. over the same two month period.

The Distimo report draws a conclusion that's by now all too familiar to developers: Monetizing Android apps poses enormous challenges, especially when an app relies on a one-off download fee model. The arguments for why Android Market is such tough sledding are no less familiar: Discovery challenges, billing complexities, piracy, etc. But let's not forget that Android Market has made significant advances in recent weeks, most notably with the March introduction of in-app billing functionality--and that could be the change that establishes the Android platform as a truly viable business opportunity for the developer segment.

That's because in-app purchases of virtual goods continue to attract strong interest from consumers, especially gamers--and especially men. Although the percentage of men playing mobile social games is only slightly higher than the number of women, males account for 90 percent of all virtual goods purchased in-game, according to data released last week by mobile web entertainment destination MocoSpace. Fifty-three percent of MocoSpace social gamers are men, and 47 percent are women--69 percent of all male gamers buy virtual items like weapons and additional lives, while 31 percent of all female gamers make virtual purchases. Even so, those 69 percent of men outspend their female counterparts by a 9-to-1 margin. No matter if it's guys or gals making purchases, it's not just fun and games--it's also a path to profitability for developers. -Jason