iPhone vs. Android: Where should you put your money?

Currently, the mobile app market is largely split between Apple’s iPhone and devices powered by Android, the mobile operating system developed by Google. BlackBerry has set up its own marketplace, BlackBerry App World but that seems to be nowhere when compared with the Android App Store or the iPhone App Store.

To give you a better idea, every month the three stores generate 1.6bn downloads – 1bn for Apple’s App Store, 500m for Google’s Android Market and 90m for Research In Motion’s BlackBerry App World. Therefore, the first decision a budget-sensitive marketer has to make, is where to put your money: iPhone or Android? For the most part, there are some definite pros and cons to both platforms.

Android

The promise of Google’s Android Market was that it would be dramatically different than Apple’s approach to distributing mobile software. Google created a transparent “Market” rather than a “Store”, with an open platform (with no approval process, a la Apple’s App Store), for developers to enter the market seamlessly.

In reality though, the majority of paid apps on Android clock less than 100 downloads. A report from Distimo found that 20% of all free apps and 80% of all paid apps have been downloaded fewer than 100 times on the Google Android Market worldwide to date.

Meanwhile, at the other end of the scale, 96 apps have been downloaded more than 5 million times in the Android Market, with Google Maps achieving 50 million +. It’s not easy to make money from paid Android apps.

Some blame the billing system, others blame the lack of discovery features, and some even suggest that Google has a deliberate strategy of marginalising paid apps in order to force developers to make their apps free and advertising-funded.

Android Apps – The Future

Google have been busy working on a number of improvements to help mobile developers; these include new country-specific charts, Editor’s Choice picks, a special icon for so-called Top Developers to help them stand out on the store, improved suggestions for related apps when someone is browsing the store, and a section to show currently trending apps.

Android has the potential to be a much more lucrative platform for paid apps, alongside its undoubted strength for free apps, and now is the time for marketers to be setting their sights on this market.

Apple

One of the major drawbacks for Android is fragmentation of the operating system. According to Google, about 65 percent of Android devices are running version 2.2 “Froyo,” while 21.2 percent are running Android 2.1 “Eclair.” Other versions of Android are in use right now, as well. That’s not a good thing for Google or Android.

The iPhone has had four OS releases and only four generations of the device — the iPhone, iPhone 3G, iPhone 3GS and the iPhone 4. All four generations have had similar hardware, meaning that most apps are compatible across the board. The Android, with its many devices and variations, means developers have to keep upgrading.

Apple has also nailed the ease of app purchasing. Purchases are done through your existing iTunes account that is linked directly to your credit card — a few clicks and you’re downloading.

Apple Apps – The Future

Consumers are downloading more apps–and spending more for each one–for their iPhone, iPod Touch or iPad.

iOS device owners will download 83 applications this year, compared with 51 a year ago, a 61 percent increase. More importantly for Apple and the app developer, consumers will spend on average $1.44 per application, a 14 percent increase from a year ago.

Apple’s advantage continues to be the sheer number of applications available to its customers. Apple’s App Store has more than 425,000 applications, compared with 200,000 available to the Android Market. In May, Google said it crossed the 4.5 billion downloaded application mark. Last week, Apple said it crossed the 15 billion threshold.

The company’s iPhone is still the top smartphone in the world, and its tablet is easily outselling any other alternative in the market. Apple is a threat right now to Android and Google will need to do a lot to stop Apple’s runaway success.

The best way forward

So what’s the best way forward for marketers? As we can see, both the Android Market and the iPhone App Store have their pros and cons. In a recent forecast report by Gartner, the outlook for Android was decidedly positive, as they predicted Android would account for 49.2 percent of the market share by the end of 2012, versus Apple’s iOS predicted share of 18.9 at the end of the same year.

But where is the best place to spend your marketing budget? In the long term you will need to have both an iPhone and Android app. App development is not as expensive as many people think. The average cost of an app is approx. £10k.

Many of your competitors will be well on their way to creating their app for these stores, or at the bare minimum investigating both options. The App Stores are only going to get bigger and more successful so it’s vital that your company is involved.

In terms of budget I recommend creating the iPhone app first. Apple has a greater hold in the App market. Consumers are currently more impressed to hear you have an iPhone app. Also, there is a greater chance your audience owns an iPhone. Once the iPhone app is settled in the store I would recommend creating the Android version.

You would have learnt a lot about the development of an app, Apple’s App Store, how to market an app, download volumes, etc., which can only help when making the decision to create an Android version. By creating an Android app you double the potential audience to download your app overnight. Not a bad thing.

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Russell Berry has over 12 years experience in project management. His passion for the mobile market lead him to create AppCreatives with Rodney Joseph in July 2009. Since then he has project managed over 30 mobile apps (and counting). Russell excels at taking a clients initial idea and developing the concept through to a delivering the app. He has also regular features as a columnist for many leading publications, such as, the Financial Times.

  • melci

    Your iOS versus Android marketshare figures are completely inaccurate as Gartner is only projecting quarterly sales and only for smartphones.

    If you are comparing app platforms, you of course need to compare all Android devices versus all iOS devices and not just quarterly sales projections but installed base. After all it is installed base that represents the total number of devices out there capable of running your app.

    In those terms iOS is far larger than Android and will be for quite some time to come.

    Apple recently announced they had sold 222 million iOS devices compared to only 135 million Android devices and with only 17 million iPhones sold in the first year, the vast majority of those 222 million iOS devices are still in use. ComScore agrees putting he number of active iOS devices at 59% greater than Android in the USA in April and 156% greater in Europe.

    With Apple selling 22 million iOS devices in the 43 days leading up to July 19th, that makes 512,000 iOS devices sold per day. With Android running at 550,000 per day over the same time period, Android is not closing the gap any time soon.

    Then there is the vast differential in profitability between the platforms. In 2010, iOS developers made $1.3 billion versus only 103 million for Android devs and with iOS app downloads still far larger than Android (71% of all downloads to iOS devices in 2010 according to IHS Screen Digest), Android devs are not making ump the difference in advertising.

    I think it is pretty obvious why most developers who ar serious about making money develop for iOS first and then target Android next if resources permit.

    -Mart

    • RedMercury

      With Apple selling 22 million iOS devices in the 43 days leading up to July 19th, that makes 512,000 iOS devices sold per day. With Android running at 550,000 per day over the same time period, Android is not closing the gap any time soon.

      Blink.

      Apple is selling 512,000 iOS devices per day.  Android is activating (ie selling) 550,000 per day.  Last I checked, 550,000 is more than 512,000.  So it sounds like more Android devices are being sold per day than iOS devices.

      It sounds like Android has closed the gap.  The question is will iOS be able to reopen it?

      • melci

        Mr RedMercury, the gap is 87 million devices large in terms of installed base which is what developers are interested in – you know, the number of potential customers –  the topic of this article.  

        Android is far from closing this gap “any time soon” with daily sales only 7% greater than iOS.  Notice the words in quotes?  

        With Android sales growth slowing from 9.5% in the Sept quarter to 7.5% in December to only 3% in the March quarter, the question is will Android be able to close this gap at all?

        -Mart

  • You should not stare blindly at market share numbers. More importantly are revenue share, and mind share. The common Android user user is not as inclined to part with money as the common iOS user is. So even if there would be 10 potential Android users you are more likely to get more revenue by targeting 1 potential iOS user. The numbers are not absolutes, but reflect my experience as an app developer.

  • I prefer Mac OSX over Windows, but so far I’m unimpressed with their
    mobile devices. I think it comes down to the innovation factor.
    Android is open-source and can be cracked/customized easily. Apple is
    extremely closed with their mobile OS.