In what should be a very welcome addition for Android developers, Google is adding subscription billing to its app store.
That should give developers yet another to earn revenue on top of in-app purchases of virtual currency, downloads of paid apps and advertising. It will probably most benefit mid and hardcore game developers, who are more likely to have rabid fans willing to pay for monthly access. It will also help magazine publishers, who are still figuring out how to sell content on tablets.
All of the subscriptions are auto-renewing and can be set with monthly or annual fees. Developers set the price themselves. There’s also an HTTP-based publisher API that lets enterprise-scale backend servers validate or cancel subscriptions. It’s inter-operable with subscriptions on the web, so users can take their paid access with them across devices and web destinations.
The revenue share is just the same as it is with paid apps and in-app purchases. Google takes a 30 percent cut. When Apple launched subscriptions on iOS, some publishers like The Financial Times balked at Apple’s cut and instead built HTML5 apps to circumvent the fees. Google’s situation is a little more complicated as it relies more on carrier billing, which means most of their 30 percent cut may actually go toward mobile operators.
Google hand-selected a few developers to launch with subscriptions today. One of them is Glu Mobile, which is a publicly traded mobile game developer. They’re best known for “action-adventure” games like Gun Bros and they did just over $17 million in smartphone revenue in the first quarter of this year (which was a pretty impressive 72 percent increase from the quarter before).
Google is playing catch-up with iOS in terms of helping developers make money from their apps. Mobile analytics firm Flurry found that for every dollar a developer earns on iOS, they earn about a quarter of that on Android. Most of this has to do with how Android just has fewer paying customers on file. If you look at revenue on a per-user basis (or how a paying user spends on average), it’s actually almost the same on iOS and Android. So as long as Google can get more payments information on Android users, it looks promising.