Did you know that you can purchase all of the top 100 paid iPhone apps for a total of $147? That’s just $1.47 per app, on average, though looking at the list, many are $0.99.
If you were to buy the top 100 paid apps in the Android Market, though, it would cost you a whopping $374.37, or an average of $3.74 per app. That’s more than 2.5 times the cost of the top iPhone apps.
Why are Android apps so much more expensive? According to app analysis company Canalys, Apple has a more mature retail environment that encourages price competitiveness, while Android has fewer customers willing to make app purchases, which drives up the price.
Because of these significant differences between the app stores, publishers and developers that get their sales in volume on iOS must make up the difference in cost in the Android Market.
According to Rachel Lashford, Canalys Managing Director:
“Developers and publishers need to balance the iOS volume opportunity with a potentially greater value per download opportunity on Android, where more apps command higher price points. Selling more apps at higher prices is the Holy Grail for developers, but achieving big volumes of paid apps on Android is no small challenge. More aggressive price competition around Android apps would help to encourage more consumers to make their first app purchases, drive greater download volumes, and ultimately be good for the vibrancy of the app ecosystem.”
Games and apps that are highly successful in Apple’s App Store, are not always as popular with Android users, making for very different retail environments. For example, while EA often offers discounts in the App Store where price competitiveness is crucial to staying visible, the company does not offer the same discounts in the Android Market. For that reason, Monopoly on iOS is $0.99, but $4.99 for Android.
Remember how I mentioned that the majority of Apple’s top apps were just $0.99? The exact number is 82. So more than 80 percent of the top 100 apps are less than a dollar. In the Android Market, only 22 of the top 100 apps are priced at $0.99, with the rest being more expensive.
While the average app price might be more in the Android Market, this doesn’t mean developers are earn more money making Android apps. Previous reports show that Apple’s App Store generates six times more revenue than the Android Market when comparing the top 200 grossing titles of both app stores and that Apple has approximately 85 to 90 percent of the market share of total dollars spent on apps.
One more explanation is in-app purchases and freemium pricing models, which iPhone and iPad users have become accustomed to. Customers who purchase low-cost apps are more willing to invest additional money over time, while the same is not true of the Android Market, where in-app purchasing is more uncommon. This gives iOS developers an advantage over Android developers, because they can price low to entice customers, and end up getting the revenue back later.
There’s one other interesting tidbit that the survey unearthed – iOS users and Android users have different app tastes. In both U.S. stores, only 19 apps made it into the top 100 paid lists for both stores.
Of course, this entire survey is like comparing circles to squares, because both app environments are so different. There’s no mention of the fact that many of the top iPhone games and apps are actually offered for free on Android, so while it’s fun to look at the data, it isn’t very revealing when the app stores only have 19 apps in common.