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BlackBerry LBS apps 4X pricier than iPhone, Android

A recent Skyhook Wireless report comparing RIM's BlackBerry App World, Apple's App Store and Google's Android Marketplace found a great disparity in the cost of applications between the three stores.

Skyhook Wireless, provider of XPS, the patented hybrid location system, released the report on trends in location-aware apps from the three smartphone players, which found that the average price of a location-aware app in Blackberry App World is $13.60, compared with $3.60 in the iTunes App Store and $0.84 in the Android Marketplace.

"There are three major apps stores right now, and they have three very different distribution points for apps, and they are operating under different models," said Kate Imbach, director of marketing and developer programs for Skyhook Wireless, Boston.

"While Apple has new apps with new pricing models, RIM is still operating under an old model with legacy pricing, as most App World developers that have been developing BlackBerry apps for a long time, she said.

"With App World price points four times higher than the average iPhone app, it's a hard sell for RIM to change their pricing to match the current ecosystem."

If Palm comes out with an app store, and as Microsoft enters the fray, it will be interesting to see how the model of application distribution evolves, and if BlackBerry can sustain its current model of location-aware apps for $19.99 or so.

BlackBeryy App World uses PayPal for consumer payments, while Apple uses iTunes and Android Marketplace uses Google Checkout.

Founded in 2003, Skyhook Wireless launched the first hybrid positioning system to leverage Wi-Fi, GPS and cell towers, delivering precise location data supporting the growing market for location-based services.

Skyhook's hybrid positioning system XPS requires no new hardware, works indoors and outdoors and provides an instant location.

The Skyhook report, which is published on a monthly basis, found that the Apple App Store has the greatest number of location-based applications, at more than 2,300, and the highest percentage of paid-for LBS apps, at more than 75 percent.

Sixty-seven percent of Blackberry apps are paid, while 80 percent of Android Marketplace apps are free.

"Android is different as well, as 80 percent of Android apps are free, which is the reverse of Apple's App Store, where 75 percent of apps are paid," Ms. Imbach said. "Android's payment mechanism is Google Checkout, which is cumbersome compared to iTunes, so it's hard for developers to monetize apps because it's hard for consumers to pay for them.

"Android developers are competing against other apps that are free, so it's hard for them to back up and start charging for apps," she said.

After standardizing app types across all three App Stores, this report found 17 different types of apps that use location.

The most popular location-aware apps are related to Travel, Navigation and Social Networking, but new types of apps, such as Music, Finance and Games, are also integrating location in new ways.

Ad-supported applications, or applications that combine a subscription with advertising, may be the wave of the future. Already many large brands are investing in advertising within mobile applications.

"There are a lot of apps that are experimenting with deploying ads across all different platforms, but they're not taking advantage of the location information within the apps to target based on location," Ms. Imbach said. "Soon location-aware apps will start serving targeted ads, but if you look at apps right now, that ads that are served are not always great, because they're not that targeted.

"On the mobile platform there is an opportunity to take advantage of user's exact physical location to deliver highly targeted ads," she said. "Once the whole value chain comes together to serve location-aware targeted ads, everyone will make more money."