Amazon’s app store generates three times as much revenue as Google’s

Ability to generate revenue will always be key

Amazon’s Appstore is generating more revenue per daily user than the Google Play storeaccording to new data from mobile analytics firm Flurry, as Amazon’s app store continues to gain traction amid competition from Google’s official offering and independent rivals such as GetJar. In the study, Flurry looked at the revenues generated for developers by “a basket” of top-rated apps that are available for the same price across Google and Amazon’s app stores, as well as Apple’s, over 45 days from mid-January to the end of February. Setting the revenue generated by Apple’s App Store at 100%, the firm found that the apps on Amazon’s store made 89% of that figure per active user, while Google Play pulled in just 23%. The findings suggest that Amazon’s strategy of tightly controlling the quality of apps in its store and running promotions to boost user engagement may be paying off.

Amazon, who forked Android in order to put consumers into their own shopping experience on Kindle Fire, is showing its commerce strength, already delivering more than three times the revenue in its app store compared to what Google generates for developers,” says Flurry’s marketing VP, Peter Farago. “As developers make decisions to support different platforms, the ability to generate revenue will always be a key factor. Based on revenue potential, we expect to see an increasing number of developers support Amazon.

Flurry suggests that the success of Apple and Amazon in the app space is down to the pair’s shared grounding in retail. Farago notes that Apple runs the “highest revenue-per-square foot” retail store worldwide, while both Amazon and Apple run successful online stores selling digital, as well as physical, goods. Google’s strengths, on the other hand, lie in search and advertising. “Running a store, retail or digital has not been Google’s traditional core competency,” adds Farago.

Indeed, the lack of revenues generated by its app store may not be a major cause of concern for Google. The firm is using Google Play as a means of building up its content ecosystem to attract consumers to its Android operating system. While Google said last year that its mobile business was worth around $2.5 billion annually, figures from a recent filing in its ongoing litigation with Oracle suggest that Android has only generated around $550m for Google since 2008. Rather than hoping to make money from the OS itself, Google is instead seeking to get Android on as many devices as possible in order to build up its mobile ad business.

Flurry forecasts that the success of Amazon’s Appstore could lead to more manufacturers following its lead and building devices that run on a customised version of Google’s OS. Such a move could be key for firms such as Samsung as they look to differentiate their offering amid growing competition in the markets ranging from smartphones to tablets to TVs. “Software is the easiest way to achieve this,” says Farago. “If all hardware makers have the same software, then differentiation drops.” 

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