Android Market Changes Coming to Boost Sales

Apparently Google is not satisfied with the way the way sales are going with its Android Market, and it's looking to fix that, starting with the way apps are purchased.

"We're definitely not happy with the purchases in the Android Market," said Eric Chu, Google's group manager for Android, during an interview at the Inside Mobile Apps conference this week, where he discussed a couple of major changes that are coming to his company's on-device software store.

Google plans on implementing in-app purchases, so users can buy an app, its add-ons, and its "virtual goods" all within the app itself, rather than having to use an external payment system. This system was initially slated to be released in December, but due to developers focusing on holiday apps, Google could not acquire enough feedback to be "comfortable" with launching it then.

Indeed, the developers benefit from in-app payments, too. While this is a step up in convenience for consumers, Chu said that in-app payments can also help developers in that it opens a new sales channel, where users buy virtual goods explicitly for their games or communities.

It seems like a lucrative system; many online games have shifted to free-to-play models, charging players only if they decide they want to purchase specific game items, and revenue for this sector is projected to reach 2.1 billion in 2011, according to the market-research company Inside Virtual Goods.

More Carrier Billing
The other major change that Google is looking to implement is carrier billing. Technically, at this stage of the game, it would be more of an expansion, as this is a system that Google already has in place with AT&T. With this set up, customers can have their Android Market purchases sent directly to their monthly carrier bill, rather than having to pay separately.

Chu said that the carrier billing is "expensive" to implement, but he once again stressed both the convenience to users and benefit to developers.

"As we add additional forms of payment, developers don't have to do anything," he said.

Chu also touched on a number of minor Market changes, all grouped under the label of "merchandising," including: new ways to help users find their desired apps quicker; creating more lists; exposing more apps; and updating the algorithm that is used to rank apps.