At a time when most consumers either would not prefer or rather hesitate to pay for apps that they download, developers have adopted the 'freemium' model to make money on app stores.
This platform agnostic route is being taken by most mobile app developers wherein they attract customers to download their apps for free and then entice them to upgrade to a “premium” or paid model which is either free of intrusive ads (which are part and parcel of the free version) or is far more feature rich.
Generally, the money generated out of an app is divided between the app developer, handset maker (in case of a preloaded app), network provider and the app store.
Freemium models account for over 65 per cent of app revenues globally, and more players are expected to experiment with the same in India.
Rolocule Games, an gaming developer, is focused on developing iOS games and monetising them through a freemium model, a report by Avendus Capital on India’s mobile Internet said.
Though small in scale today, the report said that it is encouraging that the total paid app revenues from the iOS app store and Google Play in India crossed Rs 150 crore in 2012.
Paid apps are driven by two types of revenue streams; the pay-only model, where the customer pays to download the app from the app store, and secondly, the “freemium” model, where the customer downloads an ad-supported free app with limited features with the ability to upgrade to the full functionality ad-free app through paid upgrades or in-app purchases. Total monthly revenues earned by Google Play and Apple App store from Indian customers was Rs 27.5 crore during October 2012, or an annualized run-rate of Rs 330 crore.
“Based on this, the market size for 2012 can be estimated to have been somewhere between Rs 150-200 crore,” Avendus said.
Indian users are extremely conscious of their application downloads considering that freemium model allows them to pay for exactly what they require.
“Unlike demos, the freemium model provides the full version of the application, allowing users to try before they buy. From a developer point of view, freemium applications are extremely effective as it shows confidence in the app’s ability to sell itself based on functionality,” BlackBerry Director (Alliances and Business Development) Annie Mathew said.
App development companies like Twist Mobile took the freemium route since they saw 1 million downloads of their app Age Effect in just six weeks, while the paid category showed only modest downloads.
According to Maxx Mobile COO Krishna Singh, paid apps are not doing well presently; however, paid app developers are making a conscious effort to give consumers value for money.
Though small in scale today, the report said that it is encouraging that the total paid app revenues from the iOS app store and Google Play in India crossed Rs 150 crore in 2012.
Paid apps are driven by two types of revenue streams; the pay-only model, where the customer pays to download the app from the app store, and secondly, the “freemium” model, where the customer downloads an ad-supported free app with limited features with the ability to upgrade to the full functionality ad-free app through paid upgrades or in-app purchases. Total monthly revenues earned by Google Play and Apple App store from Indian customers was Rs 27.5 crore during October 2012, or an annualized run-rate of Rs 330 crore.
“Based on this, the market size for 2012 can be estimated to have been somewhere between Rs 150-200 crore,” Avendus said.
Indian users are extremely conscious of their application downloads considering that freemium model allows them to pay for exactly what they require.
“Unlike demos, the freemium model provides the full version of the application, allowing users to try before they buy. From a developer point of view, freemium applications are extremely effective as it shows confidence in the app’s ability to sell itself based on functionality,” BlackBerry Director (Alliances and Business Development) Annie Mathew said.
App development companies like Twist Mobile took the freemium route since they saw 1 million downloads of their app Age Effect in just six weeks, while the paid category showed only modest downloads.
According to Maxx Mobile COO Krishna Singh, paid apps are not doing well presently; however, paid app developers are making a conscious effort to give consumers value for money.
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