Business Platforms

App Revenue – Android gaining on iOS fast!

App revenues for iOS

Android has long since passed iOS in terms of sales, installed base and even app downloads, while total number of apps available is now about level. Despite this app revenues for iOS developers have remained consistently higher. Is that about to change?

Looking at the recent device sales figures it seems reasonable to assume this must happen eventually, in the last quarter Android had 75% market share, outselling iOS 5-1. Of course iOS has been selling for longer and the really strong surge in Android sales is relatively recent; even so according to Tomi Ahonen, the installed base of smartphones is 53% Android and 20% iOS.

When it comes to downloads, the average iOS user still downloads more apps than their Android counterpart, despite the greater proportion of free apps on Google Play. The massive advantage in installed base puts Android comfortably ahead on download share though. A very recent report by ABI Research (although for Q2 2012 data) put the download share for Android smartphones at 47%, with the iPhone at 29% (although the iPad still had 5 times all Android tablets combined).

iOS ahead on monetization…

However, according to App Annie (you’ll have to watch the video for the numbers), iOS was way ahead of Android on monetization in the first half of this year with the average iOS download being worth 7 times the average Android download. In fact, for January to April of 2012, total iOS app revenue was 2.45 times the equivalent Android revenue with both growing at the same rate.*

This might explain some of the declining interest in Android from developers. In our last Developer Economics survey, Intentshare (developers planning to adopt the platform) for Android fell from 35% to 25% and this was mirrored in an IDC/Appcelerator survey where the number of developers “very interested” in building apps for Android declined for the 4th quarter in a row.

… but don’t drop out on Android too soon!

It might just be that developers are losing faith in Android too soon. In the recent App Annie video linked above they mentioned that Android is now catching up fast. If you look at their recent graphs on freemium vs premium monetization you can see how fast. From April to September iOS revenue has not grown.  In contrast, Google Play revenue was at almost double the April level. Since that data the new iPhone 5 and iPad mini will undoubtedly provide a boost to iOS app revenues and due to the more affluent user base, iOS will likely remain ahead of Android on average revenue per download. However, it looks very likely that 2013 will be the year that Android overtakes iOS on total app revenues.

* App Annie revenue figures are for paid downloads and in-app purchases only. Advertising is excluded, although iOS also generates more revenue per ad than Android.

By Mark Wilcox

Mark is developer who has worked on everything from the lowest level smartphone firmware to games and apps that sell pizza. He's also a project leader with a focus on lean methods and a consultant who loves rapid prototyping, app economics and business models.

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