iOS devices bring Apple $576.3, Androids cash in only $3.5 to Google

iOS devices bring Apple $576.3, Androids cash in only $3.5 to Google
Android revenues are a closely guarded secret, but it seems that a court filing has finally revealed them and there's nothing to brag about. Google seems to have a sustainable business with Android as long as it can keep the exponential growth of the platform but it reaps little revenue, and actually it gets much more from iOS handsets. Here's the maths behind this conclusion. 

It all stems from a recently held judicial hearing where Google ceded to pay Oracle $2.8 million and 0.515% of Android revenues on an ongoing basis. If Google agreed to pay 0.515% of Android revenues, it only makes sense that $2.8 million is actually a cumulative 0.515% of all Android revenue so far, from 2008 to 2011. Basic math shows that total Android platform revenues stand at $544 million from 2008 to 2011.

Now, obviously revenue is scattered differently across those four years, so we’d need to look at Android’s exponential growth and the overall installed base. Again, it’s logical to assume that as install based grew, so did the revenue. Luckily, all of those stats are available and neatly compiled in graphs by Horace Dediu of Asymco.

All of this comes with another important assumption and that is revenue per device. It could have changed upwards, or downwards, but for the sake of simplicity, it’s assumed that it remained stable throughout the years.

With this in mind, we arrive at Google revenue per handset per year of merely $1.70.

Does the figure make sense? Google actually revealed “mobile run rate” of $2.5 billion in October 2011. And mobile here includes everything - iOS, Symbian and others where Google services are present. Again, if we interpolate the Android revenue data we arrived at to the overall “mobile run rate” of $2.5 billion, we’d see clearly that Android is only a fraction of Google’s mobile income.

The Guardian’s Charles Arthur suggests that if we subtract Android from the overall mobile income, we’d arrive at Google’s revenue from iOS. And the results are eye-opening - iOS brings 4 to 5 times more revenue to Google than Android (again, with all those assumptions in mind).

In 2011 alone, iOS brought five times more revenue than Android. iOS brought $8.33 in revenue to the search behemoth, while Android cashed in $1.70.

And if we take an average 2-year lifespan for an Android device, we’d see that Google makes around $3.50 from it. Apple - in stark contrast - has $576.3 for each iOS device sold in 2011. The numbers speak for themselves, don't they?


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57 Comments

1. drahmad

Posts: 480; Member since: Aug 20, 2011

google is crazy.

50. Lucas777

Posts: 2137; Member since: Jan 06, 2011

yes and no... if they have the money to support android, this solution is fantastic because it pushes google to everything... but if they do not have the money to support it then no... the probem is apple is moving away from google services, but i think it will be fine... if microsoft apple, oracle, nokia, and various others keep taking a part of the pie, google might need to charge licenses for their os...

2. andro.

Posts: 1999; Member since: Sep 16, 2011

Android is fundamentally a open source free platform for everyone and therefore its not a way for google specifically to make billions on. Apple model on the other hand is a tight restrictive,massively locked down total control system and money gouging happens to the maximum potential,usually at ifans expense so all in all these figure are as expected. Googles revenues come from so many different aspects of its total business as well as ios as PA documented here before that google is getting money from each ios device sale.

27. darkkjedii

Posts: 30966; Member since: Feb 05, 2011

Yeah yeah yeah androsheep

29. darkkjedii

Posts: 30966; Member since: Feb 05, 2011

Hey andro I heard google was on the grassy noll. You'll still defend them though.

49. andro.

Posts: 1999; Member since: Sep 16, 2011

Your childish rants are hilarious!! Haha!!!!

32. veggiedude

Posts: 1; Member since: Apr 03, 2012

Nope. It is based on two open source free platforms - Linux and Java - but Google has stolen Java and right now are defending their actions in court against Oracle. Android doesn't even play nice by the rules of Linux open source community. Android's days may be numbered.

3. strikercho

Posts: 156; Member since: Mar 20, 2012

Basically Giggle way is to make money out of everuthing possible. They're good at only one thing - their search engine. The only use of Handroid as an ''open-source'' is to make Handroid fans look at the commercials. If one day Handroid's popularity decreases, I am 90% sure that they will immediately abandon it. And move to the next thing that can bring them cash - like strip bars, if necessary. :)

4. Whateverman

Posts: 3295; Member since: May 17, 2009

Apparently Google is good at making an OS that makes fans of other OSs green with envy as well.

18. _PHug_

Posts: 482; Member since: Oct 11, 2011

Wait, was "giggle" and "handroid" supposed to be funny or comical? It wasn't. It wasn't even remotely clever. If your friends encouraged you to use those phrases they aren't your friends, they just laugh at you behind your back.

5. gauravbh1

Posts: 10; Member since: Apr 03, 2012

Did somebody say the Android is a open source platform. It is but it is the least open of the open source platforms. That obviously doesn't help.http://arstechnica.com/open-source/news/2011/08/study-android-is-least-open-of-open-source-mobile-platforms.ars

6. Whateverman

Posts: 3295; Member since: May 17, 2009

What I got from this article is Google still made $544M from an OS they give away to everyone for free! Good job Google!

7. donzere

Posts: 12; Member since: Jun 10, 2010

Do y'all know why apple is the KING: because they give you a badass software and a sick hardware to accompnay it. That's why neither google, samsung, htc etc can't compete lmao. And yes i have used android since the day one it came out but after switching to IOS last 3 weeks i just realized how laggy and buggy peice of s**t my galaxy S was..

8. Sniggly

Posts: 7305; Member since: Dec 05, 2009

So what happens the first time your iPhone screws up? (Yes, it happens.)

40. sgogeta4

Posts: 394; Member since: Feb 02, 2011

You do know that Apple is paying Google, Samsung, and all these other companies because these companies actually make everything for Apple.

48. darkkjedii

Posts: 30966; Member since: Feb 05, 2011

Boeing makes some of the parts for cadillac, Ferrari makes domes parts for Chevy. Who cares... Apple competes with these companies, and they pay apple for patents that they use in their software. The wheels on the bus go round and round round and round round and round. Think about it.

55. RageQuit

Posts: 44; Member since: Sep 05, 2011

Now try webOS, it kicks the asses of both android and iOS in fluidity. when you do you will realize how laggy and buggy your peice of s**t iPhone was. Have fun with your software that makes doing simple things like connecting to a hospital wifi a pain.

9. Sniggly

Posts: 7305; Member since: Dec 05, 2009

I still think these estimates are low. Besides, it's great that Google is making bank on the services it provides on all devices that use it. For Google, it's never been purely about profit-it's been about making themselves ubiquitous- a goal they've already succeeded at with their online services, and a goal they're pretty damn close to achieving on Android. In fact, I can't imagine their market share increasing much more in the mobile world.

12. PackMan

Posts: 277; Member since: Mar 09, 2012

ios devices = ios + hardware with highest profit margin. android = open source platform.

15. gauravbh1

Posts: 10; Member since: Apr 03, 2012

Least open source

35. kanagadeepan

Posts: 1247; Member since: Jan 24, 2012

A walled-Garden is NO WAY better than least open source....

13. PackMan

Posts: 277; Member since: Mar 09, 2012

ios just claims to be secure when its not. bbos used to be secure but it has gone downhill. ios just plain boring nothin but app grid. they just buy hardware from other manufactures and toss it inside a pretty case. they are very hard to repair and repair too costs a fortune.

41. sgogeta4

Posts: 394; Member since: Feb 02, 2011

IOS isn't secure. The US military uses Android for a reason.

21. remixfa

Posts: 14605; Member since: Dec 19, 2008

ok, that graph obviously does not count the liscencing fees for google apps and the Play store that they charge manufacturers. That is a whole lot of conjecture based on one number. Assuming thats even remotely true. YAAAAY GOOOGLE!!! Way to milk the competition while leaving your own customer's money in their pockets. For all the iOS nuts that are going to comment something derogatory about google, remember, your paying for our OS. Thanks, guys. HA!

34. darkkjedii

Posts: 30966; Member since: Feb 05, 2011

We're happy to help u out, since google can't make one themselves. iOS is boss, google takes the loss.

52. sprockkets

Posts: 1612; Member since: Jan 16, 2012

Oh, so apple made OSX/Darwin completely from scratch? Didn't take a thing from BSD huh?

56. remixfa

Posts: 14605; Member since: Dec 19, 2008

dude, as long as you are happy to not only pay for your phone, but mine, u can keep on making stupid jokes. face it.. google was smart enough to know that crazed inuts are OK with spending money when they have no idea where its going :)

36. RabidCB

Posts: 2; Member since: Apr 03, 2012

"YAAAAY GOOOGLE!!! Way to milk the competition.." Did you mean, YAAAAY GOOOOGLE!!! Way to harvest my data..."

22. Droid_X_Doug

Posts: 5993; Member since: Dec 22, 2010

Based on the limited $ that Google is making from even iOS sales, it should be obvious that Google is not looking at handset sales as its revenue engine. Instead, it's revenue engine is from the searches conducted from the handset. Which explains the 'fee' it paid to Apple to continue being the default search engine on iOS. Apple, OTOH, makes its $ from iDevice sales. The App store and iTunes ecosystem merely serve to feed the demand for iDevices, and Apple's 30% revenue share allows it to basically break even on those costs. Good article. I was wondering about Google's revenues per Android device. Those numbers must have made Larry Ellison go batsh*t crazy. He probably didn't even cover his litigation expense.....

28. networkdood

Posts: 6330; Member since: Mar 31, 2010

This makes sense - I rarely buy anything for my smartphone - too many ways to get it free....it is called 'being smart'. Apple users love to get screwed by paying for something that can be free on an Android phone. Good for Android users and bad for iPhone users, and good for APPLE.

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