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Experts forecast Android Market will outshine App Store

Google?s Android operating system is growing at lightning speed and is gaining ground on the iPhone when it comes to the ?sexy factor.? Brands are starting to take notice.

The top four carriers nationwide all offer Android-based devices, with the Sprint HTC EVO 4G and the Droid series of smartphones on Verizon Wireless undisputed successes. While Apple is still the master of creating buzz for its devices, Android is making huge strides in that area, and?with more than 70,000 applications and counting in Android Market?brands, agencies, publishers and developers are taking notice.

?Among brands, some are porting apps to Android as they see the volume of users with these devices increase, but it still lags behind the iPhone, of course,? said Neil Strother, Kirkland, WA-based mobile practice director at ABI Research. ?The number of brands developing for Android is growing as the user base grows.

?Android apps and the whole platform are on agency and brand radar screens, simply because you look at the volume of devices, and from ad networks like Millennial that report impressions on Android, and these are growing,? he said. ?So, from a marketer?s standpoint, you have to at least consider it, and you need to find out if a significant number of your customers and prospects are using Android devices.

?I think what many are starting to find out is that the number can be larger than they think?the fact that the Droid Incredible [from HTC] and [Motorola?s] Droid X devices are selling out at Verizon Wireless, for instance, is an indication that the platform is gaining consumer acceptance.?

There have been various positive developments around the Android platform to which Google can point.

Android's search traffic grew 300 percent in the first half of this year (see story).

While Apple currently has the advantage in commerce due to the user-friendliness of iTunes, Google is taking steps to enable various types of in-application payments (see story).

As the reach of Android devices and the download totals of Android applications increase, brand advertisers are making the platform more of a priority.

The Android mobile platform is making big gains in global click-through rates, according to Smaato Inc.'s Mobile Advertising Metrics report for June (see story).

And while the number of applications in Android Market has not caught up to the tally in Apple?s App Store, the gap is closing quickly.

?Will Android Market catch the App Store? Hard to say,? Mr. Strother said. ?For right now, no?Android is in catch-up mode, but as it gains more apps, and if the quality of those apps improves, it will give [Apple's] App Store a run for its money.

?However, there are some issues from the developers? standpoint that present challenges,? he said. ?It?s a two-horse race in the apps space, and Android is gaining some ground.

?But Apple has a fairly comfortable lead at the moment.?

Google gaga
Most estimates put the current number of applications in the App Store around a quarter of a million, and Apple gets close to 500 application submissions every day.

Android Market still has not crossed the 100,000-applications threshold.

That said, some analysts and mobile industry executives believe that it is only a matter of time before the number of applications in Android Market surpasses the App Store.

?Android is coming on strong?certainly from a market share standpoint it is growing both in North America and globally,? said Todd Christy, president and chief technology officer of Pyxis Mobile, Waltham, MA. ?More and more of our customers are asking for and deploying Android apps.

?I do think Android Market will catch up with the App Store, although Apple has a significant head start,? he said. ?Google is taking a different approach that is very developer-friendly.?

Mr. Christy said that Google has a model that will support explosive growth of applications and that Android Market will eventually overtake the App Store in time.

Some features that are particularly appealing for developers are APIs to integrate Google Voice, Google Maps and location-based services.

All of these provide tools to enhance marketers' toolkit.

?Google offers tie-ins to apps that are quite impressive and that are a straightforward thing to do on Android,? Mr. Christy said. ?Google offers integration into voice recognition and location-based services such as mapping, geofencing and geolocation?Android is very solid on that front.

?Android is a bit behind on the user interface side, but Google has announced a very aggressive strategy on that front,? he said. ?Google has a strong track record, so I expect them to accelerate the pace of innovation in terms of Android?s user interface.?

More Android developers
Google's open-source platform has attracted many software developers, many of whom previously focused exclusively on creating applications for Apple devices.

Many developers that have had success with applications for the iPhone and iPod touch have realized that they have to support Android as well.

More often than not, that demand for an Android application is coming straight from brands, agencies and publishers.

?Android has quickly become a force to be recognized in the smartphone arena,? said Andrew Osis, CEO of Multiplied Media Corp., the Calgary, Canada-based developer of the Poynt location-based search application for iPhone/iPod touch and Android. ?The platform is attracting both new smartphone users and ?switchers? from other devices.

?Android is having a great year and it has produced some great numbers and a strong buzz,? he said.

It?s not the platform, it?s the audience
While the Google-Apple debate will no doubt continue to rage indefinitely, the reality is that most marketers could not care less about what platform they use to reach their target audience?they only care about results ? actually reaching that target audience.

Android is growing in popularity among brands, agencies, publishers and developers because it is growing in popularity among consumers.

The bottom line? Marketers follow consumers? eyeballs.

?We?re seeing growing interest in Android, but I don?t think advertiser growth is where consumer growth is,? said Krishna Subramanian, cofounder of mobile ad exchange Mobclix, Palo Alto, CA. ?There is a lot more demand for Android, but for advertisers the hype isn?t quite there yet.

?It?s about awareness?brands don?t care about the platform, they care about reaching a specific audience,? he said. ?They want to know, ?What?s the easiest way to reach that audience???

Opportunities for Android in wake of Antennagate
Just as the iPhone has helped reduce AT&T?s churn rate, Droid devices have helped Verizon retain subscribers (see story).

And while the carriers battle it out, Apple is going head-to-head with Google and the various handset manufacturers such as Motorola, HTC and Samsung that have embraced the Android platform.

Apple's recent Antennagate flap may have created an opening for Android and its supporters to grab hold of more market share.

Dr. Windsor Holden, principal analyst at Juniper Research, Portsmouth, England, said in a blog post that it is reasonable to suggest that, of late, Apple has had a fairly uncomfortable time of it.

Riding high on the euphoria of the iPad launch, the company followed up in June with the global launch of the iPhone 4, at which point things started to go a little awry thanks primarily to an unfortunately located antenna.

?My anticipation at the time of launch was that the iPhone 4 would sell considerably more than its predecessor at the outset, and sure enough, three days after blast off, 1.7 million iPhone 4s had been sold, against 1 million 3GSs the previous year,? Dr. Holden said.

?So far so good," he said. ?But then came Antennagate, and, well, the medium term prospects have clouded over somewhat.?

The unusually maladroit way in which the issue was first handled?Steve Jobs? emailed suggestion that one should ?avoid gripping it in the lower left corner in a way that covers both sides of the black strip in the metal band??was followed up by a somewhat more considered response allied to a software update, per Dr. Holden.

However, a certain amount of public relations damage was certainly inflicted, as evinced by a consumer survey conducted by Opinium Research, which found that one in four people in Britain was less likely to buy an iPhone in the wake of the bad publicity, according to Juniper.

What makes this particularly galling for Apple is that perhaps for the first time, it is facing genuine competition in the consumer smartphone market.

In the U.S., for example, Motorola reported a sharp rise in smartphone shipments, with sales of its flagship Droid X device exceeding expectations.

Other Android devices?and globally there are more than 50, according to Juniper?are now being activated at the rate of 160,000 a day.

At nearly 5 million per month, that is food for thought for Apple, which last quarter?a record quarter?shipped 8.4 million iPhones.

While Apple still has a healthy lead over Android handsets in terms of the global user base, that lead is now being eroded rapidly.

?Of course, this is not Apple?s apocalypse, and with the aforementioned iPad now threatening to revolutionize the tablet market in the same way that the iPhone did the smartphone market, then we are likely to see some more impressive shipment figures from Apple come its fourth-quarter results in late-October,? Dr. Holden said.

?But it is certainly a wakeup call for the company, and with Google breathing down its neck, it must hope that no further negative issues are raised in the coming months as it girds its loins for the pre-Christmas marketing campaigns,? he said.

Final Take
Mickey Alam Khan, editor in chief, Mobile Marketer