Mobile Application Markets: Marketplace Comparison

Apple vs. Google vs. Nokia “Competition with Apple ! ! begins to mature”

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Date: November 29, 2010 Research Note #4

Ovi  Store,  Android  Market,  and  App  Store:  a  Comparison
November  2010

EXECUTIVE  SUMMARY: The  past  three  months  have  marked  some  important  milestones  for  the  three   primary  mobile  application  markets,  Ovi  Store,  App  Store  and  Android  Market.   While  Nokia  was  busy  launching  a  revamped  Ovi  Store  for  developers  and  a  user   base  approaching  140  million  users  in  more  than  190  Countries,  Android  Market   passed  the  100,000  app  point  and  become  the  No.  2  operating  system  accounting   for  25.5  percent  of  worldwide  smartphone  sales  according  to  Gartner.   Google  is  still  behind  Apple  when  it  comes  to  mobile  applications  (there  are  now   over  300,000  applications  in  the  App  Store,  with  paid  apps  available  in  90   Countries).  However,  as  revenues  and  overall  satisfaction  with  Ovi  Store  continue   to  decrease  and  the  App  Store  becomes  overcrowded,  Android  is  becoming  an   attractive  alternative  for  developers. Our  research  allowed  us  to  identify  not  only  signiMicant  differences  in   satisfaction,  revenues  and  issues,  but  also  common  critical  items  that  developers   consider  priorities  to  be  addressed  in  order  to  beneMit  both  them  and  their  end-­‐ users.  These  include  the  ability  to  respond  to  user  comments  and  bug  reports  in   the  store,  better  promotion  and  distribution  tools  and  better  search  capabilities,   and  improved  publishing  process  while  maintaining  a  certain  level  of  quality   control. - Open-First August, 2010

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Between  September  and  November  2010,  Open-­‐First  conducted  three  surveys  on  developer   satisfaction  with  the  three  primary  mobile  application  markets,  Android  Market,  Ovi  Store,  and   App  Store.   Over  300  mobile  applications  developers  and  publishers  responded  to  an  online  questionnaire   including  multiple  choice  and  open  questions  pertaining  their  experience  with  the  stores.   Respondents  were  found  through  a  search  for  top  selling  and  top  free  applications  available  on   Android  Market,  Ovi  Store,  and  App  Store  for  various  devices.  The  Mindings  of  these  surveys  are   representative  of  a  sample  of  app  developers  and  publishers  across  Europe,  Asia,  America,  and   Australia. The  surveys  focused  on  Mive  areas:       Publishing  Experience         Support  and  Resources  Available  to  Developers  and  End-­‐Users       Revenues         Overall  Satisfaction       Comparison  to  Other  App  Stores This  report  summarizes  Mindings  of  the  three  surveys,  highlighting  similarities  as  well  as   differences. - Open-First August, 2010

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Quality  Review  Process  for  Applications  Submitted  to  the  Store

In  spite  of  their  large  success  in  terms  of  apps  distributed,  App  Store  and  Ovi  Store  are   somehow  infamous  for  their  slow  and  at  times  inconsistent  application  approval  process.  Our   Mindings  show  that  39  percent  of  iPhone  developers  are  somehow  unhappy  with  the   turnaround  time  for  quality  approval.  For  Nokia  developers  this  percentage  is  up  to  47  percent.  

Android  Market  offers  an  alternative  to  this  model.  Google  doesn’t  screen  apps  before  they  can   reach  the  store  but  leaves  it  to  the  users  to  decide  what  apps  are  good  and  what  aren’t.  So  while   for  a  new  app  it  takes  only  a  few  minutes  to  get  up  to  Android  Market,  this  takes  a  few  days  in   the  App  Store  and  up  to  2-­‐3  weeks  in  Ovi  Store. Moreover,  unlike  in  other  storefronts,  Google  does  not  charge  developers  to  distribute  their   apps  on  Android  Market,  making  it  even  easier  and  quicker  for  developers  to  see  their  apps   immediately  available  to  users. - Open-First August, 2010

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Our  study  however  showed  that  not  all  Android  developers  welcome  this  freedom.  While  58   percent  of  them  think  the  lack  of  approval  process  makes  the  storefront  even  more  attractive,   25  percent  of  them  think  the  introduction  of  some  centralized  quality  review  would  represent   an  improvement  to  the  average  quality  of  the  store. - Open-First August, 2010

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Support  to  Developers  and  End-­Users

When  asked  what  resources  for  developers  they  Mind  useful,  the  majority  of  Android  developers   indicated  technical  articles,  tutorials  and  sample  code  as  the  best  resources  available  to  them.   The  preference  of  Nokia  developers  went  to  Discussion  Boards.   Both  technical  and  publishing  support  were  rated  as  the  worst  support  resources  by  a  quarter   of  Nokia,  Android,  and  iPhone  developers.  The  main  issue  they  seem  to  have  is  the  difMiculty  to   reach  someone  they  can  talk  to. Our  Mindings  also  show  that,  according  to  developers,  the  App  Store  offers  the  best  support  to   end-­‐users  (40  percent  of  iPhone  developers  think  the  support  in  good).  Our  November   Developer  Satisfaction  Survey  for  Android  Market,  on  the  other  hand,  showed  that  35  percent   of  Android  developers  are  unhappy  with  the  support  provided  by  Google  to  their  end-­‐users.   This  is  mostly  related  to  the  fact  that  frequent  download  and  payment  problems  occur  and   Google  doesn’t  provide  adequate  support  during  this  process. About  a  quarter  of  surveyed  developers  are  not  exactly  aware  of  the  kind  and  level  of  support   provided  to  end-­‐users  of  the  three  storefronts.  A  percentage  between  20  and  30  percent  of   remaining  developers  said  they’re  “neutral”  toward  it. - Open-First August, 2010

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SpeciRic  Issues  Encountered  by  Publishers  and  Developers  

Some  common  issues  and  concerns  that  emerged  from  all  three  surveys  are: • • Slow  and  inconsistent  application  approval  process  (for  Nokia  and  iPhone  developers) Inability  to  respond  to  user  reviews  and  comments  in  the  store  (especially  in  Android   Market  and  the  App  Store) • Stores  (Android  Market  and  Ovi  Store  in  particular)  were  criticized  by  developers  for   having  poor  search  capabilities  and  a  cumbersome  user/publisher  interface • • Inadequate  visibility  and  promotion  opportunities  for  applications  in  the  stores Bad  technical  and  publishing  and  poor  communication  efforts  that  Nokia,  Google  and   Apple  are  showing  to  developers • Bad  reporting  of  sale,  revenues,  installations,  and  other  data  critical  to  developers.

Some  speciMic  issues  that  represent  concerns  only  for  some  developers  include: • Serious  issues  with  the  download,  installation  and  payment  of  applications  in  Android   Market,  worsened  by  unclear  error  reporting  and  support • Bad  handling,  in  the  iPhone  App  Store,  of  business  support  and  lack  of  transparency   over  policy  changes  and  other  decisions  that  affect  developers’  business • Lack  of  piracy  prevention  in  Ovi  Store. - Open-First August, 2010

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Revenues  and  Revenue  Expectations  

According  to  our  Mindings,  about  half  of  iPhone  developers  are  making  MORE  money  than  they   had  anticipated  by  selling  apps  on  iTunes.  The  percentage  of  iPhone  developers  who  are   making  less  money  than  expected  is  less  than  a  third. For  Nokia  developers  these  results  aren’t  as  exciting:  only  1  percent  of  them  said  they’re   making  more  than  expected  on  Ovi,  while  69  percent  are  making  LESS  than  anticipated. Android  Market  is  half  way  in  terms  of  revenues  and  expectations:  a  third  is  earning  more  than   expected,  a  third  is  earning  less  than  expected  and  a  third  is  making  about  as  much  as  expected.  

Android  developers  whose  revenues  are  lower  than  expectations  think  the  main  reasons  for   their  disappointment  are  both  the  poor  payment  handling  system  and  the  fact  that  there  aren’t   enough  payment  options.  They  also  think  Google  has  been  building  a  “culture  of  free,”  making   users  less  willing  to  pay  for  apps  than  other  users  (e.g.  iPhone  users). Across  all  storefronts,  another  main  reason  for  low  revenues  was  identiMied  in  the  poor   discoverability  (e.g.  bad  search  capabilities,  limited  number  of  app  categories)  and  visibility   (e.g.  restriction  on  the  length  of  app  description,  lack  of  promotional  tools,  unclear  ranking   criteria)  of  applications  in  the  stores. - Open-First August, 2010

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Our  research  study  showed  that  over  the  last  three  months  the  percentage  of  Android   developers  whose  revenues  are  exceeding  expectations  increased  by  5  percentage  points,  while   the  percentage  of  Nokia  developers  whose  revenues  are  exceeding  expectations  decreased  by  4   percentage  points. - Open-First August, 2010

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Overall  Satisfaction  

According  to  our  Mindings,  developer  satisfaction  with  the  iPhone  App  Store  is  the  highest  (78   percent)  while  satisfaction  with  Ovi  Store  is  the  lowest  (50  percent).  Results  for  Android   Market  were  similar  to  those  for  the  App  Store,  with  73  percent  of  developers  saying  they’re   overall  satisMied  with  the  store. Our  research  study  showed  that  over  the  last  three  months  overall  satisfaction  with  Android   Market  has  increased  by  10  percentage  points  while  overall  satisfaction  with  Ovi  Store   remained  about  the  same.

Intention  to  Remain  in  the  Store

Findings  from  this  question  are  in  line  with  Mindings  from  the  question,  “How  satisMied  are  you,   overall,  with  this  store?”   99  percent  of  iPhone  developers  said  they  plan  on  remaining  in  the  store  and  none  of  them  are   planning  on  leaving  the  store.  93  percent  of  Android  developers  are  planning  on  remaining  in   the  store  and  1  percent  of  them  are  planning  on  leaving. - Open-First August, 2010

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Results  from  our  October  2010  Developer  Satisfaction  Survey  shows  that  while  76  percent  of   developers  currently  on  Ovi  Store  are  planning  on  staying,  6  percent  are  planning  on  leaving   and  18  percent  are  undecided.   Our  Mindings  show  that  over  the  last  three  months  the  percentage  of  respondents  who  said  they   would  stop  distributing  their  apps  via  Ovi  Store  increased  from  3%  to  6%.  These  developers  are   mainly  disappointed  with  revenues  and  are  looking  at  Android  Market  as  an  alternative. - Open-First August, 2010

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Comparison  to  Other  Mobile  App  Storefronts

63  percent  of  all  developers  we  surveyed  expressed  a  preference  for  the  App  Store  over  Ovi  and   Android  Market.  This  preference  is  based  on  either  experience  or  belief  that  the  App  Store   offers  better  earning  opportunities  because  of  its  popularity  among  mobile  users,  its  functional   and  intuitive  interface  and  iPhone  users’  propensity  to  spend  money  on  applications.   27  percent  of  respondents  expressed  a  preference  for  Android  Market  and  10  percent   expressed  a  preference  for  Ovi  Store.  What  makes  Android  Market  a  preferred  choice   (especially  for  current  Ovi  Store  publishers)  is  the  absence  of  an  approval  process,  which  makes   it  an  attractive  alternative  to  Ovi’s  slow  approval  process  for  applications  submitted  to  the   store. - Open-First August, 2010

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Suggestions  for  Improvement  

Some  improvements  that  all  developers  across  the  three  stores  suggested  are: • Some  way  for  developers  to  communicate  with  end-­‐users  (e.g.  The  ability  to  respond  to   user  comments  and  bug  reports  in  the  store) • Better  reporting  (e.g.  Statistics  and  alerts  on  installations,  un-­‐installations,   demographics,  sales  by  Country,  etc)     • Help  with  the  promotion  and  distribution  of  apps  (e.g.  Longer  app  description  and  more   screenshots  allowed,  in-­‐app  advertising  programs,  addition  of  multiple  levels  of   categorization,  free  trials  for  apps)   • • • Better  support  to  developers  on  both  publishing  and  technical  issues Better  search  function   Improved  publishing  process  while  maintaining  the  level  of  quality  control  for   published  apps. SpeciMic  requests  made  by  publishers  on  the  Android  Market  are  the  resolution  of  issues  with   downloads  and  payments,  the  introduction  of  more  payment  methods  (e.g.  Paypal),  and  better   support  for  end-­‐users. App  Store  and  Ovi  publishers  would  like  a  faster  and  more  consistent  quality  review  process   and  App  Store  publishers  would  like  Apple  to  adopt  a  more  transparent  communication  Mlow   allowing  better  business  support. - Open-First August, 2010

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