The next billion people online aren't going to be as profitable as the first. Google India has announced that the local version of its Play app store has reduced the lowest price developers can charge for their wares or in-app purchases to 10 rupees. The floor price used to be 50 rupees.
The new rate is equivalent to just US$0.15, £0.10 or €0.13.
Google's announcement of the price cut says it all by placing the words "We hope this lower price point makes it easier for people in India to get access to the apps and games they love at a great price" into the mouth of Alistair Pott, the product manager of Google Play.
India's average gross national income per person is US$1,610, according to the the World Bank. At that level it's not hard to see why Google has dropped the floor price or why it thinks the new lower limits represent easier access to apps.
The bigger play here, of course, is grabbing market share in a nation where a great many people's online forays will be on mobile devices for the foreseeable future. Let's also ponder whether Google thinks there's more to be made in the long term, for itself and developers, by cutting prices now and thereby expanding the potential pool of buyers.
One of the developers Google has named as signing up for the new price tiers, Colin Rowe of Stick Sports, maker of Stick Cricket, told The Reg he welcomes the cut. "We get a lot of downloads from India but don't monetise anywhere near as well as we do elsewhere in the world," he said.
Rowe thinks that's because few Indian users have credit cards and instead rely on prepaid cards or carrier billing to pay for apps. Lower prices, he feels, are "one ingredient in a recipe for change," rather than a silver bullet.
Rowe said other ways to improve sales in India include easier access to those who select pre-installed apps among Indian carriers and handset vendors, plus a better understanding of carrier billing.
"There's a massive opportunity in India because it is a cricket-loving nation. We don't expect to be on top of the sports category in app stores, we want to be on top of the overall sales charts," Rowe said.
Whatever Google's motives and developers' reactions, a Google Play India account may now be something worth acquiring in any nation as a route to cheaper apps. ®
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