androidmarketplace Report: 98.9% Of Downloads On The Android Market Are FreeMobile gaming and an abundance of free apps have helped the Android Market surpass 250 million downloads according to a report from market research and consulting firm FADE.

FADE claim that an estimated eight million Android users downloaded 289 million apps, of which 98.9% were free to download.

Whilst Android gaming revenue jumped 50% in January and February, a sales total of $900,000, research suggests that many users are not downloading many paid apps compared to other handset markets.

FADE tracked the addition of 1,200 gaming title to the Android Market in the first two months of 2010, highlighting that the average Android user is spending just 6.1 cents on Android games and $0.50 on all other applications. This, when compared with an iPhone users estimated $1 gaming spend and $5 spend on all other apps, accentuates the gulf in revenues between the two smartphone platforms.

The report mentions that the low revenue from the Android Market isn’t down to the quality or depth of the apps, instead focusing on four major factors:

  • Payment UI
  • Android 1.5 in use on ~ 30% of available handsets
  • Limited number of paid countries
  • Inability to download applications to SD cards

The future of the Android Market doesn’t look all that bleak. There have been reports that the Open Handset Alliance and handset vendors are to start working with similar firmware updates, minimising the fragmentation of Android users using different software revisions.

As a result, improvements made to the user interface will make it easier for users to make app purchases on their Android handset. With the influx of more powerful handsets and increased marketing, it would be surprising if the Android Market doesn’t begin to monetize more effectively in the near future.