App developers, operators face revenue sharing challenges

Different models apply in developed and developing markets

Mobile service subscription models have emerged as a major factor as mobile operators and developers debate ways to balance revenue sharing models, increase the number of local applications and encourage innovation.

During a roundtable discussion in Barcelona at the Mobile World Congress on how to develop applications for the mass market, the post-paid and pre-paid subscription models were cited as part of the difference in remuneration of developers in developed versus developing countries.

"In most developing countries, 90 percent of the subscribers are on pre-paid service and any money spent on buying an app reduces the ARPU [average revenue per user]; in developed countries, payment plans are fixed and anyone buying an app will have to spend more. That's why there is a difference in revenue share," said Marco Quatorze, head of VAS at America Movil, a leading services provider in Latin America.

When partnering with an operator, the developer will enjoy access to marketing channels and advertising, which Quatorze says should be factored into the revenue sharing agreement.

Nokia has a revenue sharing model of 70 percent to the developer for apps on the Ovi store, but some mobile operators prefer to pay a fixed amount for the app then bundle it together with other services.

"In some cases, Nokia has been absorbing the costs in order to protect the developer. Our engagement with developers at a local level has allowed us to study the markets closely," said Mary McDowell, executive vice president, mobile phones, Nokia.

Apart from differences in spending habits, McDowell said that consumers in India and China prefer to first use the app and then pay for it later, compared to Western markets where users download apps and are immediately billed.

Lack of good billing-information sharing between developers and operators has also left some developers in developing countries feeling shortchanged because they are unable to track the number of downloads.

Join the PC World newsletter!

Error: Please check your email address.

Tags MWCtelecommunicationNokiamobileAmerica Movil

Our Back to Business guide highlights the best products for you to boost your productivity at home, on the road, at the office, or in the classroom.

Keep up with the latest tech news, reviews and previews by subscribing to the Good Gear Guide newsletter.

Rebecca Wanjiku

Unknown Publication
Show Comments

Most Popular Reviews

Latest News Articles

Resources

PCW Evaluation Team

Azadeh Williams

HP OfficeJet Pro 8730

A smarter way to print for busy small business owners, combining speedy printing with scanning and copying, making it easier to produce high quality documents and images at a touch of a button.

Andrew Grant

HP OfficeJet Pro 8730

I've had a multifunction printer in the office going on 10 years now. It was a neat bit of kit back in the day -- print, copy, scan, fax -- when printing over WiFi felt a bit like magic. It’s seen better days though and an upgrade’s well overdue. This HP OfficeJet Pro 8730 looks like it ticks all the same boxes: print, copy, scan, and fax. (Really? Does anyone fax anything any more? I guess it's good to know the facility’s there, just in case.) Printing over WiFi is more-or- less standard these days.

Ed Dawson

HP OfficeJet Pro 8730

As a freelance writer who is always on the go, I like my technology to be both efficient and effective so I can do my job well. The HP OfficeJet Pro 8730 Inkjet Printer ticks all the boxes in terms of form factor, performance and user interface.

Michael Hargreaves

Windows 10 for Business / Dell XPS 13

I’d happily recommend this touchscreen laptop and Windows 10 as a great way to get serious work done at a desk or on the road.

Aysha Strobbe

Windows 10 / HP Spectre x360

Ultimately, I think the Windows 10 environment is excellent for me as it caters for so many different uses. The inclusion of the Xbox app is also great for when you need some downtime too!

Mark Escubio

Windows 10 / Lenovo Yoga 910

For me, the Xbox Play Anywhere is a great new feature as it allows you to play your current Xbox games with higher resolutions and better graphics without forking out extra cash for another copy. Although available titles are still scarce, but I’m sure it will grow in time.

Featured Content

Latest Jobs

Don’t have an account? Sign up here

Don't have an account? Sign up now

Forgot password?