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| Google's Larry Page |
The iPhone has always been, the consensus goes, the rich man's phone. iOS customers earn more than Android users. They spend more on apps and on in-app purchases. And advertising rates are higher.
But new figures show that this prevailing wisdom is no longer always the case: In some categories, Android apps are becoming just as profitable for developers as those on Apple's platform.
According to DAU-UP, a gaming marketing company, average revenue per user (ARPU) for Android games has increased steadily over 2014. In January, it was just 20% of the ARPU enjoyed by iOS games. By December, it was at 65%. While, it's a big jump, iOS users are still spending more.
However — and this is the important bit — media advertising costs are between 20-50% lower on Android devices. When that's taken into account, some Android game apps are as profitable (or even more profitable) than iOS ones.
Here's a graph illustrating the rising lifetime average value (LTV) of the Android apps surveyed over 2014:DAU-UP(LTV refers to lifetime revenues from paid downloads, in-app purchases, ad revenue, etc.)
One limitation to be aware of is that the data only comes from games — we don't know if this trend is repeated in productivity apps, say, or mobile e-commerce. But there's no reason to believe that in other categories it'd skew dramatically in the opposite direction. (And games are a very significant sector of the app economy in their own right.) The data is also a sample, drawn from more than 10 million users (primarily in North America and Europe).
What this all means is that yes, Apple customers are still spending more — for now. But Android is on a strong upward trajectory, as its customers spend more and more. They could ultimately reach the same levels as iOS users — and even as it currently stands, some Android apps are already proving more profitable than their iOS equivalents.
DAU-UP believes that developers are increasingly turning to Google's platform first.
"After years of being the unwanted step child, Android is having its Cinderella moment, as game developers are increasing their Android development resources to meet the growth in Android revenue," said CEO Idan Nizri. "We're hearing more and more developers developing games 'Android First.' I have no doubt that game developers will invest more time, effort and resources in Android in 2015."
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