The numbers have been studied, and all signs point to the fact that while developers still generate more revenue on iOS in the iTunes App Store than in the Google Play Store for Android devices, the gap is shrinking. We've also seen some pretty impressive new Android tablets on the market and on the way, so why aren't developers working harder to support 10" Android tablets?
We've seen the vicious circle of app support a number of times: a platform has trouble gaining traction because of lesser app support, and has lesser app support because it doesn't have enough market traction. It happened early on for Android, and is something that Windows Phone is still struggling with. The strange thing is that it's also been a problem for 10" Android tablets, even though Android has definitely been gaining momentum in the market.
The days of the iPad being the de facto choice for a tablet are gone. The last set of numbers showed that Apple's once dominating lead had fallen to a mere majority stake with the iPad comprising just under 57% of tablet shipments worldwide, and Android all the way up to 41%. Granted, this number does include 7" Android tablets, as well as 7" Android offshoots like the Amazon Kindle Fire, but regardless, Android has certainly proven that it is making its way into the hands of consumers. Getting devices into the hands of consumers is a strong step towards breaking the vicious cycle of app support, and the another big factor in breaking the cycle is in how much revenue is generated on a platform.
The shrinking revenue gap
For those stuck in old thinking, let's get this out of the way as clearly as possible: Android is not populated only by free apps, and users do purchase apps. In fact, while Apple does still lead according to some metrics, the revenue gap is shrinking and some even put the Google Play Store as the better option for making money as an app developer. There are four different sources for the numbers that we've seen, and while the specifics vary, the trend with all of them is that app revenue gap is shrinking.
We do need to point out that a lot of these numbers are based on estimations and extrapolation. The last time there were real stats on the subject of app revenue was back in Aril, then Tech-Thoughts took those stats and used estimated month-over-month growth stats to extrapolate. That doesn't
necessarily mean that the numbers are wrong, but we definitely can't take them as fact either. However, the month-over-month trends are the real issue, and those show Android gaining on iOS.
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The general trend comes from App Annie, which is a service that helps developers track their apps' revenue stats across both iTunes and Google Play as well as overall app store trends for all apps. Back in April, the iTunes App Store generated approximately 71% of all app revenue between the two platforms, and Google Play had just 29%. But, extrapolating out by using the month-over-month stats, the gap has closed quickly, and as of September, the Google Play Store could be up as high as 44% of app revenue and iTunes was down to 56%.
This is a pretty big change, and the numbers can be backed up by other studies. Most interesting is by using the numbers from VisionMobile, which
found in April/May that per month iOS apps generated an average of $3,693, while Google Play apps generated an average of $2,735. Extrapolating out, that could have shifted in favor of Android with Google Play generating more that iTunes in September at about $4000 per app per month. The key to VisionMobile's numbers is that it is based on a survey of 1500 app developers, and includes ad revenue.
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Ad revenue may be the real key, because while some say that ads on iOS are more valuable, the ad revenue could be the big equalizer in terms of overall app revenue. This seems to be shown most in the numbers from Distimo & CCS Insight, which shows that the iTunes App Store is extremely top heavy. Even just based on the original numbers from VisionMobile, the average app revenue per month was relatively close between
iOS and Android. But, the numbers from Distimo, which originate in January before the Tech-Thoughts extrapolation, show that when looking specifically at the Top 200 Apps, iOS generates quite a bit more in daily revenue per app.
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The numbers from January show that the Top 200 iOS apps generated $5.41 million in daily revenue as compared to just $0.68 million for Google Play, and even after extrapolating, the top iOS apps still make about 2.5 times more than the top apps on Android. Given how much closer the monthly averages were from VisionMobile, we can either assume that Google Play is either more evenly distributed as far as app revenue, or we can assume that app sales revenue is bolstered by ad revenue. The real answer may be somewhere in the middle, but most stores, digital and physical, tend to be somewhat top heavy as far as product popularity, so it's more reasonable to assume ad revenue is more relevant here.
However you want to look at it, it's hard to argue that Android tablets are bad business, especially with Google pushing harder and harder to put the Play Store front and center in new versions of Android on the Nexus line of devices.
Developer support
Regardless of how you feel about either platform, the numbers are showing the same trend that we saw with smartphones: Apple jumped out to a fast start, but over the long haul Android just keeps coming. The iPhone has dropped precipitously in market share (although Apple is still raking in huge profits from the device), and the iPad is losing ground as well.
Between the Nexus line, the various Samsung Galaxy Tabs, and the Asus line of Android tablets, there is plenty of choice for quality Android hardware. The customers are there for Android, and they are spending more and more money in the Google Play Store, so the question remains: Why are developers so slow to support 10" Android tablets?
The development tools are available to make an Android app that easily scales between phones and tablets via responsive design, but for some reason, developers are still slow to update apps to take advantage of the new hardware on the market. There are really only two reasonable explanations that we can think of for this:
1) There is a delay between consumer adoption and developer support. Honeycomb was the lost time for Android, and can't really count because it was so divorced from everything else. So, if we take Android 4.0 Ice Cream Sandwich as the real beginning of 10" Android tablets (as consumers seem to have done), the proper universal Android SDK has only really been on the market for a year, and proper 10" Android tablets didn't arrive until around February of this year.
Android had built up to about 40% of the tablet market as of the end of last year, but that was mostly due to 7" tablets like the Samsung Galaxy Tab, Amazon Kindle Fire, and Barnes & Noble Nook. Android 10" tablets have really only been seeing relative success in the market for the past 8 or 9 months. That should still be enough time for the major app developers to update apps for larger screens (we're looking at you: Twitter and Dropbox). So, the other possibility is:
2) The numbers aren't changing opinion. As we said, the numbers that show Android closing the revenue gap aren't firm. But, the numbers showing Android closing the market share gap for tablets are definitely real, and the numbers showing Android taking the lead on smartphones are also real. Even though the numbers we have for app revenue aren't solid, more users means more app purchases and more app revenue, so it is hard to think the numbers are that far off.
Of course, even if the numbers are accurate, the prevailing media storyline tends to be that the iPad rules the market, and Android still gets an incorrect reputation for not generating much as far as app revenue. If developers don't bother to look into the facts, that could be enough to sway them.
Conclusion
Ultimately, it seems like the issue should be getting filtered out over the next year. Android tablets are more than likely going to continue to gain market share (even if there is a short-term gain for Apple with the release of the iPad mini), and developers are going to have fewer excuses for not making proper tablet apps.
There are of course more tablet apps for Android than people tend to realize because most Android apps are universal and not split up as often as is found on iOS, but it still isn't enough. Trying to say the 10" app ecosystem for Android is sufficient is like claiming the 100,000 apps in the Windows Phone Store covers the same selection as the iTunes App Store or Google Play Store. There are going to be notable blind spots that need to be addressed.
We expect that the Android tablet app ecosystem will be spurred on with the release of the Nexus 10 (just as Google hopes), and soon enough, this won't be a story anymore. But, for now, it is still an issue, and one that will frustrate many first time Android tablet buyers.
Regardless of how you feel about either platform, the numbers are showing the same trend that we saw with smartphones: Apple jumped out to a fast start, but over the long haul Android just keeps coming. The iPhone has dropped precipitously in market share (although Apple is still raking in huge profits from the device), and the iPad is losing ground as well.
Between the Nexus line, the various Samsung Galaxy Tabs, and the Asus line of Android tablets, there is plenty of choice for quality Android hardware. The customers are there for Android, and they are spending more and more money in the Google Play Store, so the question remains: Why are developers so slow to support 10" Android tablets?
The development tools are available to make an Android app that easily scales between phones and tablets via responsive design, but for some reason, developers are still slow to update apps to take advantage of the new hardware on the market. There are really only two reasonable explanations that we can think of for this:
1) There is a delay between consumer adoption and developer support. Honeycomb was the lost time for Android, and can't really count because it was so divorced from everything else. So, if we take Android 4.0 Ice Cream Sandwich as the real beginning of 10" Android tablets (as consumers seem to have done), the proper universal Android SDK has only really been on the market for a year, and proper 10" Android tablets didn't arrive until around February of this year.
Android had built up to about 40% of the tablet market as of the end of last year, but that was mostly due to 7" tablets like the Samsung Galaxy Tab, Amazon Kindle Fire, and Barnes & Noble Nook. Android 10" tablets have really only been seeing relative success in the market for the past 8 or 9 months. That should still be enough time for the major app developers to update apps for larger screens (we're looking at you: Twitter and Dropbox). So, the other possibility is:
2) The numbers aren't changing opinion. As we said, the numbers that show Android closing the revenue gap aren't firm. But, the numbers showing Android closing the market share gap for tablets are definitely real, and the numbers showing Android taking the lead on smartphones are also real. Even though the numbers we have for app revenue aren't solid, more users means more app purchases and more app revenue, so it is hard to think the numbers are that far off.
Of course, even if the numbers are accurate, the prevailing media storyline tends to be that the iPad rules the market, and Android still gets an incorrect reputation for not generating much as far as app revenue. If developers don't bother to look into the facts, that could be enough to sway them.
Conclusion
Ultimately, it seems like the issue should be getting filtered out over the next year. Android tablets are more than likely going to continue to gain market share (even if there is a short-term gain for Apple with the release of the iPad mini), and developers are going to have fewer excuses for not making proper tablet apps.
There are of course more tablet apps for Android than people tend to realize because most Android apps are universal and not split up as often as is found on iOS, but it still isn't enough. Trying to say the 10" app ecosystem for Android is sufficient is like claiming the 100,000 apps in the Windows Phone Store covers the same selection as the iTunes App Store or Google Play Store. There are going to be notable blind spots that need to be addressed.
We expect that the Android tablet app ecosystem will be spurred on with the release of the Nexus 10 (just as Google hopes), and soon enough, this won't be a story anymore. But, for now, it is still an issue, and one that will frustrate many first time Android tablet buyers.
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