Jelly Bean dominates the Android charts, but where's the money?

Jelly Bean dominates the Android charts, but where's the money?

Summary: With close to a 40 percent usage share, Jelly Bean finally ousts Gingerbread to become the top Android release. But where are the dollars?

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According to stats released by Google, Jelly Bean is now the most-used version of the Android operating system.

The data, which is based on smartphones and tablets accessing the Google Play store, shows that versions 4.1.x and 4.2.x power more than a third of all Android devices, ousting Android 2.3.x Gingerbread, a version first released back in February 2011, from the top spot.

(Source: Google)

Over the past month, Jelly Bean's usage share — called distribution by Google — has increased by 4.9 percentage points compared to the previous month. Jelly Bean's gains are at the expense of other Android versions, in particular Ice Cream Sandwich, which has seen its distribution fall by 2.3 percentage points, and Gingerbread, which has seen its distribution fall by 2.5 percentage points.

While Jelly Bean is now the most popular version of Android, overall the landscape is a three-way split between the aging Gingerbread and Ice Cream Sandwich releases, and the current Jelly Bean release.

The data also clearly shows how Jelly Bean alone is now the only version of Android that is experiencing growth, which is good news for developers because it means the ecosystem is getting less fragmented as the months progress. However, even if the current trends hold true for the near future, devices running Ice Cream Sandwich and Gingerbread are going to be around for quite some time.

Beginning in April 2013, Google started delivering data collected from each device when the user visited the Google Play Store. Previously, the data was collected when the device simply checked in to Google servers. Google believes that the new data "more accurately reflects those users who are most engaged in the Android and Google Play ecosystem."

But thing are not all rosy for Android. Despite the fact that Jelly Bean now has the lion's share of usage, and despite the fact that Android as a whole is estimated to command almost 70 percent of the smartphone market, the money is slow to appear. As pointed out by AppleInsider, Google pulled in a little over $50 billion throughout 2012, compared to Apple's $54 billion for the last quarter alone.

In other words, Apple is leveraging its 22 percent market share much more effectively than Google is leveraging its almost 70 percent market share.

All of which goes to show, it's not the market share that matters, but what you do with it.

Topics: Android, Mobility, Smartphones, Tablets

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46 comments
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  • Answer: In Advertising Revenue

    Google's primary goal with Android is not direct revenue AFAICT, but rather in ensuring accessibility to Google's cash cow products (search, maps, drive, etc.) from the majority of mobile devices. That's where they derive the bulk of their profits, so their strategy appears to be working brilliantly.

    The mere (!) $50 billion in direct revenue in 2012 is just jelly beans. Ahem.
    ricegf
    • One Revenue Stream

      If I remember corretly, the last time I checked Google had ONE source of revenue and that was from ads. No matter what services they may be offering they make there money from the ads served in those services.
      hafenbrack
      • Almost correct.

        Google does not completely make its revenue from ads. It has some paid business services in apps, Google Drive, and other web computing areas. But yes, the majority of Google's profit comes from advertisement revenue.
        Chad_S
      • One revenue stream?

        Google has well 30% of all play store apps. Last time I checked QuickOffice and a few other Google owned app where not free. Music, Books, Movies all distributed through the Play store (They are competitors in those markets). They also sell a line of devices (which they may not make a lot off of Nexus stuff but it is something). Google has as many revenue streams as Apple they just may not be as big.
        alex_darkness
        • Android App revenue is peanuts.

          It is about 1/5 to 1/8 of the Apple App Store and Google has revenue sharing with carriers even on Play store sales. I think Google only collects 5% and the carriers get 25% and since this is booked on an agency model, Google only gets to book about 5% of app sales through Play.

          If we take Apple's developer pay out rate of about 1 billion/month to developers for a total App Store revenue of about 1.42 billion/month. 1 billion/month for developers and and 0.42/month billion for Apple. To adjust this for Google:

          0.42 billion/month * (1/5 to 1/8) * (5%/30%) = 0.014 to 0.009 billion/month.

          At the end of the day, Google is an advertising company using detailed info from its users to sell highly targeted ads. This represents about 90% - 95% of Google's revenue stream.
          Bruizer
    • Apples and Oranges

      The article didn't seem to be making a connection to "direct revenue" at all IMO. I believe the author was making the point about the overall strategies of the companies, and which strategy writ large was making the most money overall.
      4KarmicJustice
    • weighting the dice

      "Jelly Bean dominates the Android charts, but where's the money?"

      Jelly bean has only passed Gingerbread by changing the naming strategy.

      For the first time the name 'Jelly Bean' applies to multiple second level revisions, 4.2.x and 4.3.x

      But with 32.3% share, 4.2.x has NOT passed 2.3 (GingerBread)

      And the latest version, 4.3.x, is hardly on the chart at 5.6%

      Android remains as fragmented as ever. Only the names change.
      Henry 3 Dogg
  • Troll Article

    Google doesn't make money from Android. Why would that even be a concern? Apple sells a wide variety of products. Google sells like 3 plus a few services but mostly pulls in money from advertising. This really is a biased troll article.
    MrSmith317
    • With respect MrSmith...That's just silly

      Google didn't make Android as a public service...they did it to make money. Maybe to avoid losing revenue...maybe to increase revenue...but they did it for business reasons that should be reflected in earnings.
      UGottaBKidding
      • Do you not understand Android?

        Android is a vessel to money for Google. They make more money from indirect sales than most of their partners do from direct sales. Meaning that as long as there's an Google Search/Android/Chrome/Whatever latest Google gizmo, there will be ad sales money in Google's pocket.
        MrSmith317
        • Which is, I believe, Adrian's point

          AKH said... "despite the fact that Android as a whole is estimated to command almost 70 percent of the smartphone market, the money is slow to appear" He didn't mean revenue from sale of Android..because it's free...he meant the ad revenue and AppStore revenue that ought to come from 70% market share. Look...I think I understand Android (thanks for asking) and I agree that it's possible that Android is purely defensive...to protect against loss of revenue from the shift to mobile...but, AKH's point is that Google isn't monetizing that 70% share very effectively.
          UGottaBKidding
  • it will take a while

    My mother bought an HTC droid incredible 2 almost three years ago, and she won't buy a phone because accepting one of Verizon's ripoff subsidies means giving up her grandfathered unlimited data. It runs gingerbread, and the way Verizon is, any droid that isn't a Motorola never gets an update. The door RAZR isn't much newer, but it got the update to I've cream sandwich, and then to jelly bean. Oy.
    TheMimic12
    • Data Usage

      Does your mother really use that much data? If it's her only access to the Internet I could see that, but for others 2 GB is probably enough. I gladly gave up my unlimited plan.
      GSKK
      • teach your mom youtube and huluplus

        2GB can disappear fast if they aren't swapping to wifi, or are using it to watch streaming content while waiting at the XYZ office.
        rwwff
    • nless you live in, say, Hartford AL...

      ...like my mother-in-law, or some similar backwater, consider Net10, Tracfone or Metro PCS - unlimited minutes and data for ~$50/month.
      fairportfan
  • Nah

    Google isn't likely including hardware sales. Also, the hardware sales make the manufacturer money or they wouldn't be selling them.
    slickjim
    • The $50 billion includes ALL revenue.

      Hardware, software, services you name it. It is just Google's revenue pales in comparison to Apple's. For example, by the end of the year, the iPad alone will be a bigger business than all of Google. The bulk of Google's revenue still comes from desktop search/usage and 2/3 of their mobile revenue is derived from iOS.
      Bruizer
      • That's cool

        While you're down playing their revenue and how they get it, do you make 50 billion a year?
        jamz2277
        • I never claimed I did.

          And compared to Apple's revenue and growth, Google's revenue is actually very tiny. The funny thing is, people posting here, like SlickJim, think the $50 billion does not include hardware sales when it includes all Motorola revenue, AdSense ad revenue, display ad revenue and service revenue.

          Then you have trybble1: "But it's still good that they ARE making $50 billion a year off Android. That way there is no negative pressure from Android on the rest of the Google system."

          No, if Google had never come out with Android, AKH's driving point is Google would still be making $50 billion/year (actually, their gross revenue would be less but their net profit would be much higher without the Motorola unit loosing money each quarter.). AKH's premise stands: Google is failing to monetize the Android eco-system to the detriment of Google, developers and 3rd party accessory makers. Google and the OHA have been able to capture massive market share but this has not carried over to web usage, developer profits, OEM profits (except for Samsung that is making a killing) or Google profits.
          Bruizer
          • Speaking of Samsung

            .. it's now ranked as the worlds largest tech company. It makes half the profit of Apple (approx. $20bn), but is diversified across a lot of different industries and all the way up and down the supply chain. It's revenue is approximately the same as Microsoft, Amazon and Google combined.

            Apples singular strength is how to squeeze profit from it's customers, and it does so with an impressively low amount of diversification.

            Personally, if I was a tech company, I'd prefer to be Samsung over the lot of them.

            Apples biggest threat is it's reliance on a few core products / app store to support them, and it's dangerously close to becoming yesterday's news without some genuine innovation (not simply new colours on a home screen for instance). Their success can turn to failure within a very short time frame (although it's likely to be a very profitable ride until then!).

            Apple simply isn't 'it' anymore, as evidenced by my observation of people abandoning iphone for other devices (largely android) due to the 'it's not as cool anymore' factor.

            If it's a long-term play google is after, then it may actually be winning.
            (from my personal experience in Australia, where we have historically had a comparatively very high percentage penetration of apple devices)
            stewymelb