As smartphone use continues to boom and application marketplaces continue to thrive with rich, innovative and entertaining apps, many have begun to recognise the potential to generate significant revenues from them.

If you intend on making an application for Android device owners, new research from Research2guidance reinforces that if a developer targets a less competitive but more price-intensive category of apps, they have the potential to lift their potential revenue by 900% – particularly if it is a Weather or Business application.

Research2guidance found that at the end of August 2011, the average Android paid application generated nearly $2,500 from when it was published. Over the month, cumulative revenue for those apps varied from $300 (Multimedia) right up to $21,000 (Weather).

category monetization Average total cumulated revenue per paid app 520x390 Want to make money on the Android Market? Build a weather or business app.

The report shows that whilst games might account for a quarter of all apps downloaded on the Android Market, the monetization potential of those title is quite low. With a huge amount of competition in the mobile gaming space, the chances of successfully launching a hit app is much lower compared to apps from those of the smallest category.

Apps belonging to the smallest category, Weather, see far higher average revenues than any other. However, due to the simplicity of Weather apps and their specific use-case, it may prove difficult for developers to find an angle on which to build.

Business apps therefore provide the best choice for developers, as there are only around 7,000 dedicated apps in that category and only 13% of them are paid downloads. If a tool is believed to provide value, users are happy to pay for it.

An independent study has also found that Android users are set to download more apps than Apple iPhone owners, with all smartphone downloads hitting 18 billion his year. Of these downloads, telecoms analysts Ovum believe games, news and weather applications will hit 8.1 billion downloads, compared to 6 billion on iOS.

This is thanks largely to Android’s high market share, with the operating system accounting for 46% of all smartphones sold, followed by Apple with 20%. However, Apple users are much happier to pay for applications, with an expected spend of around $2.86 billion by 2016 – this compares to a predicted $1.5 billion on Android.