Android Device Shipments Surge while Developers Lose Money

According to Digitimes, smartphone shipments for 2010 will top 280 million units. This is 57% higher than in 2009. This bumps smartphones up to 20.3% share of the overall handset market according to Digitimes Research analyst Luke Lin. What’s more interesting is Android’s growth.

Android’s share of the worldwide smartphone market has risen from less than 5% in 2009 to 13.8% in the first half of 2010 and is projected to reach 24.5% in the second half to become the second most popular smartphone platform, according to Lin. Shipments of Android-based smartphones are estimated to jump 561% from a year ago to more than 55 million units in 2010.

Even as Android pushes to become the second most popular smartphone platform, developers are also choosing Android as their development platform of choice. There is a major flaw in this setup, though. While Android grows in popularity and developers grow its app market, many developers are losing money. One major problem is that you can’t even buy Android apps in some countries. Pingdom puts it best:

You can only pay for apps in 13 out of the 46 or so countries where Android phones are available. For those of you who like stats, 13 in 46 works out to less than 30%. Contrast this with Apple’s App Store, which supports paid apps in 90 countries. This is a huge advantage iPhone developers currently have over Android developers.

Not only is there a problem of not being able to pay for apps, but because people who want to pay for Android apps can’t pay, piracy begins to run rampant. The longer Google waits to rectify the situation, the worse off Android developers are. As frustrated users get better and better at piracy, they will be less likely to ever want to pay for apps again.

Even users who can pay for apps sometimes run into trouble. In order to pay for an app, users have to use a credit card and go through Google Checkout. The process is pretty clunky. It is rumored that PayPal and Google may be in talks to handle Android payments via PayPal, who knows a little something about online payments. By integrating with PayPal, Google gives developers an alternative way to get paid. This could be good for Android development as well as to make it easier for customers to pay. Google and PayPal have declined to comment and it’s still possible no deal will ever be made.