Google earns 80% of its mobile revenue from iOS, just 20% from Android

Posted:
in iPhone edited January 2014


While Google's chief executive Larry Page recently described an $2.5 billion annual run rate for the company's mobile revenues, the company has testified that it has earned less than $550 million from Android across four years from 2008 to 2011.



Google doesn't publicize its Android revenues, but has called out the the growing minority of its revenues attributed to mobile devices. Compared to the $2.5 billion it expected to earn on mobile devices this year, Google reported $38 billion in total revenues for 2011, most of which comes from paid search results presented to desktop PC users.











In figures presented to the court overseeing Oracle's patent and copyright infringement case, however, Google reports that very little of its mobile revenue actually comes from Android.



The last four years of Android revenue amounted to less than $550 million, the company's documents stated, according to a report by The Guardian. Spread across four years, that indicates that Android contributes very little toward Google's mobile revenues.



Google previously described a $1 billion run rate for mobile revenues in just 2011, which includes both mobile ad revenue and Google's 30 percent cut on paid Android app sales through Google Play (formerly Android Market).



Many observers had mistakenly interpreted Google's mobile revenues to mean Android revenues, but the majority of Google's mobile search, maps and YouTube traffic come through Apple's iOS devices, which make up more than half of all high end mobile devices and more than 80 percent of all tablets.



Despite Android being widely used by smartphone makers, Google has struggled to gain traction for app sales in Android Market. Apple's iOS platform continues to eat up around 90 percent of mobile software revenues.











Biting the hand that feeds ads



Google's efforts to take over Apple's iPhone sales with Android licensing and its attempts to blunt Apple TV with with its own Android-based Google TV in 2010 and eat up iPad sales with Android 3.0 Honeycomb tablets last year have all helped to sour the once close partnership the search giant formerly maintained with Apple.



Apple has subsequently scaled back its support for Google services, ignoring many of Google's enhancements to Maps (including navigation) and YouTube (including movie rentals) in its iOS client apps. Apple appears to be working to develop its own maps services, as evident in the new iPhoto app for iOS, following several acquisitions of smaller mapping companies.



Apple has also added Microsoft Bing and Yahoo search to its desktop and mobile Safari browsers (albeit as optional search engines), and appears tilting toward making Baidu the default search engine for Chinese users.











Apple is also resisting efforts by Google to force Safari users into web advertisement cookie tracking, something Apple has opted Safari users out of by default since its original release.



In addition to developing its own mapping services, Apple has also launched iAd as its own mobile advertising unit to help developers monetize their free apps.





iAd market share in 2011.







Despite scathing predictions of death from competing ad networks and marketing organizations, iAd has successfully retained 15 percent of all US display ad revenue in 2011, despite only being available on iOS devices, which make up roughly half of all mobile devices.



[ View article on AppleInsider ]

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Comments

  • solipsismxsolipsismx Posts: 19,566member
    Android is winning?
  • gatorguygatorguy Posts: 14,540member
    Quote:
    Originally Posted by SolipsismX View Post


    Android is winning?



    Not yet.
  • jragostajragosta Posts: 10,473member
    Quote:
    Originally Posted by SolipsismX View Post


    Android is winning?



    Sure. Isn't it all about market share?
  • solipsismxsolipsismx Posts: 19,566member
    Quote:
    Originally Posted by jragosta View Post


    Sure. Isn't it all about market share?



    Even if it is, Apple's marketshare of iOS has been beating Android OS's marketshare up until this last quarter, and that's measuring activations against Apple's quarterly sales reports.
  • Quote:
    Originally Posted by jragosta View Post


    Sure. Isn't it all about market share?



    Wrong again. It is not "all about" any one factor.



    But you knew that already.
  • applegreenapplegreen Posts: 421member
    Quote:
    Originally Posted by Gatorguy View Post


    Not yet.



    Not ever.
  • dick applebaumdick applebaum Posts: 11,307member


    Either Google is lying about [misrepresenting] its Android income * or stupid for continuing the Android quest at the risk of alienating Apple and losing income... Or both!



    * to minimize penalties



    And the $12 billion MMI purchase isn't going to get them to where they want to go...



  • slurpyslurpy Posts: 4,471member
    Hilarious. All the evidence and metrics suggest that Android is ONLY strong in numbers, because basically any non iPhone smartphone will be an android phone. In all other usage metrics it fails miserably, showing that on average its being used as a dumb-phone by a majority of it users. Everyone buys an iPhone specifically BECAUSE they want an iPhone. WIth Android, they're buying a phone that just happens to be running Android mot of the time, not because they specifically chose it.
  • suddenly newtonsuddenly newton Posts: 13,052member
    Quote:
    Originally Posted by SolipsismX View Post


    Android is winning?



    Yes. 850,000 activations. Per minute. On 5 inch screens.
  • gatorguygatorguy Posts: 14,540member
    Quote:
    Originally Posted by SolipsismX View Post


    Even if it is, Apple's marketshare of iOS has been beating Android OS's marketshare up until this last quarter, and that's measuring activations against Apple's quarterly sales reports.



    You do remember how "activations" were defined by Google, right? Only purchased devices that use licensed Google services and have been activated by a service provider such as Verizon, Orange, ATT, Duetche Telecomm, etc.



    Tablets or other Google Android devices (tho perhaps relatively few) without a cellular contract/connection wouldn't be counted as activations, nor would devices still sitting unsold on a store shelf since they very obviously wouldn't be activated by the provider.



    I mention this as you could leave some readers with the impression that Android activations might not be based on anything legitimate like sales as compared to Apple figures by the way you structured your statement.
  • anantksundaramanantksundaram Posts: 16,841member
    Quote:
    Originally Posted by SolipsismX View Post


    Android is winning?



    ....the spin wars if you don't read or understand or educate yourself too much.



    Or, if you hate Apple.
  • addaboxaddabox Posts: 12,667member
    This doesn't seem to make sense. $550 million across 4 years? Against the initial costs of acquiring Danger, ongoing Android development costs, and the acquisition of Motorola Mobility, how long before Google can expect to turn a profit from the entire adventure? 10 years? 15?



    And if Apple tends towards freezing out more and more Google services as soon as they can put together credible replacements, will they ever make money in mobile? I understand long term thinking, but if these numbers are accurate it sounds like Google may have made a massive strategic error.



    Of course, their thinking may be that Apple was likely to cut them out at some point even if they played nice so better to be master of your own destiny, which I can't really fault them for.
  • neosumneosum Posts: 109member
    The numbers just don't add up. If there are more android devices running google search, google maps, and everything google that ios devices run, then their revenue should be higher from android than ios. Unless... The majority of android devices aren't running google search, maps, etc..
  • suddenly newtonsuddenly newton Posts: 13,052member
    Quote:
    Originally Posted by jragosta View Post


    Sure. Isn't it all about market share?



    I thought it was all about gigahertzs and inches and how Super your PenTile matrix was
  • sflocalsflocal Posts: 3,419member
    This just cracks me up. What will the Fandroids say to make a spin on this story.



    This tells me that the majority of Android phone users are using their Android phones as a dumb phones and not for all the cool gee-wiz (i.e. "yawn") features that Fandroid users wet their pants with.



    Don't fret kids... at least it's "open". Pfftt..
  • shadowxprshadowxpr Posts: 162member
    Well with android google went after apple and apple will do the same on searching iOS. The winner in all thesis amazon because they can co exist on their hardware and also android and iOS.



    IMHO android on phones will continue to sell because of cost and diversity of the phones but will never make more money than iOS. Hell if anything in the end google will lose more because of apple entering their ad revenue space on mobile than what hey make on android...
  • Quote:
    Originally Posted by Slurpy View Post


    Everyone buys an iPhone specifically BECAUSE they want an iPhone.



    I doubt that. I find it likely that many people buy the iPhone as the "default" purchase. Many people buy because of their friend's recommendation. Many people buy due to the salesman's recommendation. Many buy for many different reasons.



    If the iPhone were some sort of unusual choice, you might have a valid point. but when the product is the standard default product for newbies, your conclusion is unsupportable.
  • pokepoke Posts: 506member
    Quote:
    Originally Posted by neosum View Post


    The numbers just don't add up. If there are more android devices running google search, google maps, and everything google that ios devices run, then their revenue should be higher from android than ios. Unless... The majority of android devices aren't running google search, maps, etc..



    It's probably an issue of usage. Android is notoriously absent from usage figures despite its market share. People with Android devices spend less time browsing, searching, using apps, etc. It could also be that Google charges the Android manufacturers less to use its services than it does Apple.
  • solipsismxsolipsismx Posts: 19,566member
    Quote:
    Originally Posted by Gatorguy View Post


    You do remember how "activations" were defined by Google, right? Only purchased devices that use licensed Google services and have been activated by a service provider such as Verizon, Orange, ATT, Duetche Telecomm, etc.



    Tablets or other Google Android devices (tho perhaps relatively few) without a cellular contract/connection wouldn't be counted as activations, nor would devices still sitting unsold on a store shelf since they very obviously wouldn't be activated by the provider.



    I mention this as you could leave some readers with the impression that Android activations might not be based on anything legitimate like sales as compared to Apple figures by the way you structured your statement.



    I remember what Rubin said on Google+ and it answered some of the questions but there are still plenty of ambiguous or unanswered parts of this puzzle. Remember, it's being presented for marketing reasons on a social networking site whereas Apple's data are being presented for investors and the SEC. Google has been very hush about Android during their quarterly calls.
  • nagrommenagromme Posts: 2,834member
    Wow—I’m not a fan of ads in most cases (it’s a fine option as long as privacy is respected) but I’m amazed that Apple has achieved ~60% of the mobile ad revenue Google has managed. I would have expected iAds to be a distant second, or third... or seventeenth.



    Google does make money from Android in another way, though: it promotes cross-usage of Google services on desktop machines. I don’t know if there’s any significant increase in desktop Google services usage because of Android, but at the very least, it’s bound to keep some people from leaving Google or reducing their usage. And that may be protection that becomes more important to Google in future than it is now. Google wants you using Google services for everything—with their ads—and so controlling an OS is strategic for them in the long run. Or so they expect.



    Just like Apple doesn’t want Google (or anyone) controlling parts of Apple’s business, Google doesn’t want Apple (or anyone) controlling parts of Google’s business. And yet they’re clearly intertwined, like it or not!



    Quote:
    Originally Posted by poke View Post


    It's probably an issue of usage. Android is notoriously absent from usage figures despite its market share. People with Android devices spend less time browsing, searching, using apps, etc. It could also be that Google charges the Android manufacturers less to use its services than it does Apple.



    Judging by my friends, Android usage stats (not ownership or activation but actual usage) look very different depending on whether you count “monkeying with task managers and hunting for your charger” as “usage.” My Android friends are doing one of those two things nearly constantly it seems. Not me—I have an iPhone.



    Google needs to find a way to tie ads to charging! (And I don’t mean the recent articles about Android apps spending most of their battery usage on ad retrieval/tracking.) Maybe something like “watch this 30 second ad to get a 10 minute charge boost!"
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