Android Market Grows, Still Trails AppleAndroid Market Grows, Still Trails Apple

Google's Android Market has swelled since its launch about three months ago, but it's still dwarfed by Apple's App Store.

During a conference call for its fourth-quarter results, Google said there were more than 800 applications in the Android Market. This number would seem more impressive if Apple hadn't just announced its App Store had more than 15,000 apps. The discrepancy can be attributed to Apple's ability to offer paid apps, iTunes integration, and the popularity of the iPhone and iPod Touch.

When Android launched with the T-Mobile G1 last October, many industry watchers expected developers to flock to the platform because Google was far less restrictive about what apps could be created for it. For example, Apple doesn't allow apps that duplicate existing functionality of the iPhone, so music-playing programs like TuneWiki were not approved for the App Store. The Android platform enables developers to have deeper access to the operating system, and Google said the only apps it will block are programs with malicious intent.

But the pace of development for Android hasn't picked up as fast as some may have thought, and the lack of a payment option may be a main reason. While Android users can buy programs from the likes of Handango, the Android Market currently has no way to sell apps.

Apple already had a payment infrastructure set up with the successful iTunes Music Store, and it was able to leverage that with the App Store. Google said it would be rolling out a way to offer paid apps in the first quarter of 2009, but it's unclear if it will involve credit cards, PayPal, or some other form of payment. What is clear is that Google will not be keeping any of the revenue from apps sold, and Apple takes a 30% cut of programs sold in its App Store.

Developers may be drawn to Apple because Android lags far behind the iPhone in terms of units shipped. With a head start of about a year, Apple has sold more than 15 million iPhones, compared with about 1 million G1s sold. When you throw in the millions of iPod Touch units sold, the App Store represents a far more lucrative opportunity for developers than Android at the moment.

But Android may soon gain a lot of developer attention as multiple handsets are expected to be released in various geographic markets. Customers can expect at least one Android-powered smartphone from Samsung, Motorola, Sony Ericsson, and Garmin this year.