ePayments Week: Report says developers chill on Android

A report says Android dev interest is stalling, Facebook Credits gets noticed, PayPal buys another real-world service

Here are some of the payment stories that caught my eye this week.

Report: Android developer momentum stalls

Android illustrationEven as more consumers are craving an Android phone, developer interest in the platform has stalled — for now. First, the consumer angle: When Nielsen surveyed smart phone subscribers last summer, it found one third of them craving an iPhone, 26% with their eye on an Android device, and 13% sticking with Blackberry. Nielsen asked again during the first quarter of 2011 and found interest in Android had grown to 31%, just edging past iPhone’s 30%. Blackberry dipped to 11%.

We can speculate on the causes for consumers’ fickleness. Last summer, the iPhone 4 had just been released (in June) so Apple’s marketing machine was in full swing. In the dog days of summer, nothing demonstrated early adopter-tude more than swapping the beveled edges of the iPhone 3 for the boxier look of an iPhone 4. By the fourth quarter, enthusiasm around Apple’s smartphone had settled down while several handset makers (HCL, Samsung) and carriers were promoting new Android phones. At year’s end, Android had the steepest curve on smartphone growth and was second only to Symbian in global market share.

So why has enthusiasm for Android dampened for developers in the months since? Surely they’re not all swooning over the charms of the white iPhone.

Here’s a more rational explanation: A report released by developer platform Appcelerator and market research firm IDC says “developer momentum is shifting back toward Apple as fragmentation and tepid interest in current Android tablets chip away at Google’s recent momentum gains.” The Appcelerator-IDC Q2 2011 Mobile Developer Report also noted a minor shift down at the lower end of the pack, with Windows 7 inching ahead of RIM Blackberry — no doubt because of Nokia’s new alliance with Microsoft. But even so, it said that “nearly two-thirds of respondents believe that it is not possible for Microsoft, RIM, HP, and Nokia to reverse momentum relative to Apple and Google.”

Perhaps surprisingly, the waning interest isn’t driven by money — at least not directly. As Jason Ankeny notes on Fierce Mobile, the report found that only 19% of developers thought they could make more money with iOS. I’m not sure why only 1 in 5 think that, since iOS users seem to be a more lucrative market. Research from IHS iSuppli predicts that Apple’s App Store will continue to account for about three-fourths of the market in mobile apps, even as the size of the pie grows from $2.1 billion in 2010 to $8.3 billion in 2014. ISuppli’s release includes predictions on the other numbers (and they’re nicely summarized by John Paczkowski on All Things D.)

Facebook Credits get noticed

Interest in Facebook Credits is rising, sparked partly by the launch of Facebook Deals and the news that members can use Facebook Credits to purchase the deals — in effect, using Credits as virtual currency to buy real-world goods. A Wall Street Journal report speculating about the IPO value of Facebook talks mostly about its growing dominance in online ads (in the first quarter of this year 31% of all online display ads were served on Facebook) but also cited Credits as a yet-to-be-exploited opportunity. And an article in the Chicago Tribune cites an upcoming report from Social Times Pro that estimates that $600 million will pass through Facebook Credits in the 12-month period that starts in July 2011.

In the midst of all this speculation, Jesse Stanchak, an editor with Smart Brief, has an interesting read on the future of Facebook Credits seen from the perspective that it is a form of scrip. Scrip, Stanchak writes, tends to work under any of three conditions: when money is scarce, when users think they’re getting a better deal by using the scrip, and when the retailer controls the distribution mechanism. Facebook, Stanchak writes, aims to do all three.

Another eBay/PayPal acquisition at the register

PayPal made yet another acquisition that signaled the online payment service’s desire to extend its service into the physical space. Back in March, PayPal parent company
eBay said it would buy GSI Commerce
, which supplies e-commerce services to retail stores. Then in April eBay purchased Where, a mobile app for finding local deals. Now, in a deal that appears to bridge the gap between these two services, PayPal is paying an undisclosed sum for Fig Card. The Boston-based startup (which launched just last year) offers a $5 USB dongle that lets merchants accept SMS text or NFC wireless payments. A Fig video (below) is light on details, but it demonstrates the service, which runs a little like Starbucks’ mobile app except that it doesn’t rely on a bar code scan and it transmits an image of the customer to the merchant for an added bit of security.

Here’s the Fig demo video:

Got news?

News tips and suggestions are always welcome, so please send them along.

If you’re interested in learning more about the payment development space, check out PayPal X DevZone, a collaboration between O’Reilly and PayPal.


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