iPhone Apps Are Cheaper Than Android: Report

Android users are less inclined to download apps than iPhone users, which leads to developers having to charge higher prices for apps in the Android Market, according to Canalys.

Apple iOS users are generally paying lower prices for apps than users of Android devices, according to a Feb. 23 report from research firm Canalys. While free apps are the most downloaded apps on both platforms, prices of the top paid-for apps, says Canalys, are "dramatically higher" in the Android Market than in the Apple App Store.

The top 100 paid-for Android apps, for example, would cost $374.37€”more than 2.5 times the $147 it would cost to buy the top 100 paid iOS apps. Even narrowing the selection to the top 10 or 20 apps in each category, said Canalys, showed a "striking disparity in pricing."

"That developers can apparently charge more for their apps on Android and make it into the top paid list is clearly a positive,€ said Canalys Managing Director Rachel Lashford. "But the reality is that, with fewer people willing to purchase apps on Android than on iOS today, there is more of a necessity to do so."

While high download volumes at high prices is of course the ideal scenario for developers, courting consumers with more competitive pricing needs to come first, said Lashford.

"More aggressive price competition around Android apps would help to encourage more consumers to make their first app purchases, drive greater download volumes and ultimately be good for the vibrancy of the app ecosystem," Lashford explained.

The report found the App Store and Android Market to be very different environments€”the former more mature and closely controlled, and the latter more open but less secure and less user-friendly. As such, said Canalys, publishers and developers have come to use the stores in different ways and adjust their prices accordingly, and apps that are "runaway successes" in the App Store don't necessarily follow suit in the Android Market.

"Price competitiveness is crucial in Apple€™s store, where the vast majority of top-paid apps cost just $0.99, in a way that is not the case in the Android Market," said Canalys Senior Analyst Tim Shepherd. "This leads to disparities whereby an app such as Monopoly is priced at $4.99 in the Android Market but is discounted to just $0.99 in the Apple App Store."

Despite all that, Android device sales now lead iOS sales, and according to analytics from app store search company Xyologic, Android downloads in the United States are set to surpass those of iOS apps by March or April. In August, this already became the case in the Czech Republic, Poland and Portugal, and by January, Brazil, Spain, the United Kingdom, Germany and Russia had followed, Xyologic's Matthaus wrote in a Feb. 22 blog post.

While developers are for now having success with higher-priced apps in the Android Market, Canalys believes that the iOS model€”in which developers more often offer cheap or free apps with in-app purchase opportunities€”is ultimately more beneficial.

That latter, added Shepherd, "also underscores the importance of app store providers innovating and being quick to implement new features, which can enable developers to build robust and credible app business models and to make real money."

In order to make apps easier to find, Apple bought Chomp, which should help people search within the Apps Store. This can give Apple another advantage over Android.