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Why Android Paid Apps Will Fail

March 27th, 2009

barrierGoogle gave developers the good news recently that they would allow for paid apps. Ya! Umm, but there’s a problem. They used Google Checkout and don’t link it to setup, which creates a big barrier to sales. Maybe an insurmountable one.

Here’s why: when I buy an iPhone I’m excited; the value is huge, I can’t wait to get that little sucker fired up. During the process of configuring my phone, Apple ask me to setup an iTunes account and enter my credit card details. No brainer! Easy! Just let me use my phone damnit! I’m excited. I’m committed. When I later go to buy something from store I don’t have to bother with any setup, I just hit a button and it’s done. Awesome. More than happy to spend $20 a year on stuff.

Now imagine if they didn’t ask for account setup during box opening, but asked for it when you first buy something. The issue is the barrier to jump over (entering credit card details) versus the reward (a $0.99 game I don’t really care about). I’m far more likely to just skip it, or focus on the free stuff.

Apple’s lesson: put the big barriers up against the biggest value/reward.

Now I know there are some good reasons Google don’t do this. They don’t control the distribution points; they don’t want to hear carriers screaming at about losing their payment channels (and premium service revenues) like Apple does; they don’t have a system really capable of doing this. It’s going to be even worse for Nokia and Ovi.

The only solution for Google: just take the pain now and get over it. For Nokia: go start doing deals with the carriers to provide a payment channel (or just admit you want to own the services layer and start the carrier war early).

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