Google hopes to fix weak growth of Android Market app purchases

Google's Android mobile platform is experiencing considerable growth, but the company is reportedly concerned by the slow pace of application sales from the Android Market. In an effort to boost sales and keep developers happy, the search giant is taking steps to revitalize the Android Market.
Google is going to add support for in-app purchases and has been working to establish carrier billing relationships with network operators. The company also recently launched a major redesign of the Android Market application, with the aim of making software more discoverable and smoothing out the process of finding and buying applications.
Despite these efforts, the challenges have proved difficult to overcome. Developer dissatisfaction with the Android Market has been steadily growing, and high-profile developers are becoming more vocal about their concerns. One of the most iconic examples is Rovio, the company behind the popular Angry Birds game.
Rovio originally tried to avoid the Android Market entirely and distribute to Android users through alternate venues, but changed course after some early problems trying to use market competitor GetJar. Rovio eventually settled on a free, ad-supported model. Last month, Rovio announced plans to launch its own payment platform, called Bad Piggy Bank, which they will also offer to other third-party developers. Rovio's CEO cited the poor Android Market experience as a chief motivation for launching the new payment service.
The big issue for Rovio is the user experience. They want to make purchases easier and less intrusive. Users shouldn't have to leave the game or enter a credit card number in order to buy game content. It also looks increasingly like Rovio wants a more granular micropayment model where users will be able to trivially buy new level packs or pay for access to special features.
At NokiaWorld last year, the company showed how they planned to use in-app billing in Nokia's Ovi store to sell users a pig-busting Mighty Eagle bird that they can throw when they get stuck on an especially tricky level. The Bad Piggy Bank appears to be Rovio's strategy for bringing a similar capability to Android.
Google is responding by working to accelerate its push to deliver in-app billing. The feature is expected to arrive natively on Android this year, but hasn't materialized yet. It's not really clear yet how much control over the payment experience it will give to third-party developers.
Google has also been working hard to add partners for carrier billing, which allows users to add the cost of their application purchases to their monthly telecom bill rather than having to use a credit card. Android's carrier billing feature launched with T-Mobile last year and they recently signed a similar deal with AT&T.
Bringing these capabilities to Android will likely make third-party developers more comfortable selling their applications rather than using the ad-supported model. One of the problems faced by Google is the general lack of good commercial software for Android with mainstream appeal. In most cases, there are free alternatives for Android that are just as good—if not better—than the commercial offerings.
Looking at the list of top paid applications, it's surprising how many of them are solely intended for the modding community. For example, among the top ten paid applications (not including games), I currently see ROM Manager, Root Explorer, and SetCPU—all of which are intended for users who have rooted their phones. It's pretty clear that regular non-technical Android users just aren't buying much commercial software.
Another issue is that commercial applications aren't supported in some geographical regions. Developers in unsupported countries can't sell their software in the Android Market and users in those countries can't purchase commercial software. The popular LauncherPro Plus homescreen replacement application, for example, can't be sold in the Android market because its developer doesn't live in one of the supported countries. He is forced to sell the application through PayPal instead.
The new Market app doesn't fix it
One of the things that Google has done recently to encourage more sales is an overhaul of the Android Market application. Although they added some nice features—such as a "related" section in application listings that will show you similar software—they created far more problems than they solved.
The new Market application is very sluggish and regularly hangs on my Nexus One. The new featured section that wastes a ton of space at the top of the Market's main screen only loads in thumbnails approximately half of the time, making it totally useless. There are also much-needed features that are still missing, like the ability to sort search results by rating or download popularity.
If you are trying to find software that serves a certain function but you don't know specifically which application you want, you aren't going to have much luck finding the best option through the Android Market application. It's much easier to go online and use a website like AppBrain that has significantly more sophisticated search tools and does a better job of exposing popular applications.
In addition to expanding the feature set of the payment platform, Google needs to expand the Market's geographical reach and rethink its approach to improving the Android Market application. If Google wants to increase paid application sales, the company has to take strong steps to prove to developers that they can make money selling software through the market.