Google Play's paid app conundrum: It's about the credit cards

Google Play's paid app conundrum: It's about the credit cards

Summary: Amazon and Apple have the commerce relationship with customers already and Google needs to get it quickly.

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Google Play is Google's latest effort to become more intimate with its customers and developers need to monitor the search giant's progress closely. The problem: Google Play has to entice customers to pay for content and apps if developers are going to bring home the revenue.

The launch of Angry Birds Space highlights the issue. The free version of the latest Angry Birds has taken off on Android, but it's ad supported. As a result pesky ads reload, take up screen space and chew up battery life (see report). Many Android customers would be happy to buy a paid version of Angry Birds Space, but may have a major mental block when it's time to enter your credit card data.

My personal experience highlights Google's---and its developers'---conundrum. I bought Angry Birds Space on the Amazon Appstore as well as Apple's iOS. When it came to buying a premium version of Angry Birds on Google Play I paused and kept the free version. Why? I didn't feel like entering my credit card.

Paying for the app in the Amazon and Apple ecosystems was a no brainer. After all, both have my credit card data already. One click and I buy. It's easy. Google's set-up is also easy too, but I have to enter my credit card information. That commerce relationship with Google is nearly foreign for me. I pay for stuff on Google with my data and ads. Frankly, I'm not sure I want that commerce relationship with Google even though I have one already with Apple, Amazon, eBay's PayPal and my wireless carriers.

Related: Why Developers Should Worry About Google PlayApple, Amazon, Facebook, Google leading post-PC banking?Google Play: Google's ultimate answer to Amazon and Apple | CNET: Google Play mulls movie sales | CNET: Google reboots Android Market, launches Google Play | CNET: Google Play: Nice catch-up move. Now what?

Google's ability to cultivate a commerce relationship with its customers is critical to the company and developers. According to Distimo, Apple's App Store for iPad and iPhone handily topped Google's then Android Market in app revenue. Google Play (Android Market) is the free app leader.

Here's the free vs. paid app data from Distimo.

Given my reaction when it was time to link payment information to Google---and I don't think I'm alone---it's no surprise that the company is trying to figure out ways to work with wireless carriers to give Google Wallet a boost.

The data highlights the Google payment issue even in its own Android back yard. Distimo reports that 32 percent of apps on Google Play---formerly Android Market---are paid. On Amazon's Android store, 65 percent of apps are paid.

In other words, developers are likely to move more paid apps on Amazon's market. Developers ultimately will trust Amazon more with their paid app revenue streams.

Google's issue isn't that Android customers won't pay for the apps. The issue is that customers don't have a payment ecosystem set up already with Google in many cases. Google is largely starting from scratch. Amazon and Apple have the commerce relationship and Google needs to get it quickly. If not developers are going to follow the money. And increasingly the paid app money will on venues the search giant doesn't control.

Topics: Amazon, Android, Apps, Banking, Enterprise Software, Google, Software Development

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23 comments
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  • That's a flawed study...

    You cannot just count the top 200 Apps for Ad revenue when there are way more free apps on Android.
    slickjim
  • Should have been curated.

    Google Play should have been a complete restart for Google. Meaning they should have made it a curated ecosystem much like Apple's and Amazon's. No malware, no pirated stuff, just a pure and trusted experience. Maybe keep the Android Market around for the niche users who rather it over the trusted curated store. But that would make too much sense.
    dave95.
    • I want both

      Part of the joy of Android is that the market is an un-curated free for all. That said, I would love to see a walled garden of curated apps within the market... a curated market within the market, if you will. Developers could pay google a small fee to have the company certify the app is malware free, and then get listed in the "secure play store" or whatever you want to call it.
      dsf3g
    • It is curated.

      You must have missed the several articles on this topic over the last several weeks.
      Is it as tightly controlled as the Apple version? No, and for many, it shouldn't be.
      radleym
  • PayPal!

    Also, the auther failed to mention that on iTunes you can you PayPal! No need to even enter a credit card, just sign on and add paypal, fast and easy but we will never see that on Google..
    Hasam1991
  • transactions

    do a customer survey and develope a transaction system that offers convenience, simplicity, and ease
    flyguy29
  • Considering Google makes it's living by capturing and tracking your data

    I can see why people might be reticent to give them a credit card number.
    baggins_z
    • huh?

      Have you not seen the reports of Fraud in the Apple App Store? It isn't only Google but also Apple and Amazon... Crud, becareful who ever you give the card to!
      slickjim
  • No need to enter CC on phone

    The first time you buy an app, you use your PC and go to Android Market on your browser. Then buy the app and enter your credit card details. (app gets pushed to your phone automatically) Google will remember these so in future when you buy apps directly on the device you don't need to enter a CC number. That's the way I did it.
    The Star King
    • His point is that THAT is the only reason to buy with Google

      They have nothing else you would have already wanted to spend your money with them.
      Patanjali
    • RE: No need to enter CC on phone

      Agreed - I don't understand the point of this article. Maybe it's just that people using Android generally would rather use free apps, or that there are generally more free apps that take care of people's needs on Android. It doesn't matter what system you're using, you still have to enter your payment information the first time you buy something. I agree with Star King - once the info is in, you don't have to enter it again. It's easy.
      kschzhd
  • They need gift cards

    If you don't have gift cards anyone under 18 can't buy their own stuff. Why get an prepaid credit card (where it goes to anything) vs just getting an itunes card? How come you haven't already implemented this?
    Google, SERIOUSLY. You can't give away any sort of google/android prizes to the store BECAUSE YOU HAVE NO SORT OF GIFT CARDS.
    What is this, 1993?
    Mgamerz
    • iTunes success is not because of credit cards, its because of gift cards

      I'm pretty sure more than 70% of all 2011 Apple appstore and iTunes revenue came from gift cards, they are supported internationally in more than 100 countries,
      Gift cards have many benefits over credit cards:
      1) They are safe, you won't put your credit card # online
      2) You can give them to kids or teens so they don't spend more than the gift card credit gives
      3) Each time you buy a song or app on iTunes, it shows how much money you have left from your gift card, so you always know how much money you have.
      4) Don't pay the bank interests you don't need to pay. If you use your credit card and forget to pay, you will be billed next month with interests, with gift cards this doesn't happen.
      If google is not going to use gift cards, they are doomed.
      Gabriel Hernandez
      • I agree Google NEEDS gift cards

        I'm 38 years old. I have chosen to pay for everything I own with cash. I don't have a credit card, and I don't WANT a credit card. While this can be troublesome at times (Booking hotel rooms, renting cars etc), it has served me well. I don't spend beyond my means. That being said, I DO have money to spend in the Google Play store, and would love to purchase more apps for my Transformer Prime, but currently there is no way for me to do so, as I cannot purchase gift cards like my wife and kids can with their iDevices. Oh sure, I can purchase a pre-paid credit card, but that defeats the purpose, as for every transaction made, there is a fee for use. On iTunes (which I loathe BTW), if you purchase a $25.00 card, your balance goes down by whatever you spend - no hidden fees. I truly have to hand it to Apple that they have the best ecosystem for purchasing of apps, and they did it properly right out of the gate.

        I truly feel that Android's adoption rate and marketshare would explode the moment Google made gift cards available. And honestly - what is the hold-up? Once app developers start to see Google as a viable MATURE purchasing platform with every payment option available, they will flock to it in droves.
        Papamambo
  • I would never trust google anywhere near my credit card info.

    Never. Data handed over to google has a way of turning up in search results for everyone to see.
    Johnny Vegas
    • Nonsense

      When has an individual's credit card data ever shown up on Google?
      You're just echoing "facts" from other misinformed respondents.
      radleym
      • There is always risk in giving your information to a search engine company

        Google will encrypt your credit card # when you pay, however Google wallet PIN implementation was cracked in seconds since they use a 4 digit PIN, there is much info out there about Google's Wallet security problem. The same will happen if developers put an app in Android market which randomly gets access to Google's Wallet application and steals your money. I prefer if Google would use Gift cards, instead of credit card # or Wallet for payment system.
        Gabriel Hernandez
    • Show me one example

      I'd like to see one example of when credit card information used to purchase something from Google was stolen and made available in search results for everyone to see. I think you "have a way" of being paranoid, and in doing so, giving incorrect information.
      kschzhd
  • 2011 Revenue Figures

    I would love to see app store revenue figures for 2011. In 2010, Google's app store revenues were a measly $107 million compared to Apple's $1.7 billion. If those figures still have such a wide gulf, that is very bad for the future of Android.
    Synthmeister
  • Never had that problem

    I guess because I had already purchased stuff online using Google's own payment system (whose name espaces me), I never had to enter a credit card when buying apps in the market. Google just "knew" about me and my card.
    dsf3g