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How to Protect & Monetize Android Apps

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How to Protect & Monetize Android Apps How to Protect & Monetize Android Apps Using SafeNet’s Field-Proven Sentinel Software Monetization Technology WHITEPAPER Table of Contents Introduction ............................................................................................................................ 2 Global Trends .......................................................................................................................... 2 Growth & Evolving Markets ............................................................................................. 2 Freemium Boasts Greatest Revenue Share ..................................................................... 2 Android Apps Gaining Market Share ................................................................................ 2 Gaming Tops the App Charts ........................................................................................... 2 Mobility in Business Means More Business Apps ............................................................ 3 Choosing a Business Model ..................................................................................................... 3 Free Apps ....................................................................................................................... 3 Free Apps with In-App Purchases ................................................................................... 3 Paid Apps with In-App Purchases ................................................................................... 3 Paid Apps ....................................................................................................................... 3 The Importance of Securing Your Apps .................................................................................... 4 Piracy Harms You and Your Customers ............................................................................ 4 Reverse-Engineering and Theft of Intellectual Property Erodes Your Competitive Edge .. 4 Using Sentinel License Management and Intellectual Property Protection to Derive Maximum Revenue from Android Apps .................................................................................................... 5 Android Envelope ............................................................................................................ 5 JNI Layer for Android Java Applications .......................................................................... 5 Multi-threading .............................................................................................................. 6 Android Licensing API ..................................................................................................... 6 Feature-based Licensing Enables Multiple Configurations of Your Apps ......................... 7 Conclusion .............................................................................................................................. 7 SafeNet Software Monetization Solutions............................................................................... 7 Try Sentinel for Free ................................................................................................................ 7 How to Protect & Monetize Android Apps 1 Using SafeNet’s Field-Proven Sentinel Software Monetization Technology Whitepaper Beyond choosing a business Introduction model and deciding how to The advent of mobile computing via smartphone, tablets, and wearable computing technology monetize your app, how will has given way to masses of mobile applications or “apps,” as they’re commonly referred to. you actually execute those These apps entertain, help improve your productivity, and can even extend the functionality of your mobile devices. Every day, new apps are released and the number of active publishers in business models? And then the app stores is continuously growing. how will you protect your revenue and your intellectual With nearly 2 million apps available today, the vast majority of download volumes are being property (IP) investment from attributed to free apps. How then, are app developers to make money? What are the different business models and which models make the most sense? cheaters, hackers, and copycats? Beyond choosing a business model and deciding how to monetize your app, how will you actually execute those business models? And then how will you protect your revenue and your intellectual property (IP) investment from cheaters, hackers, and copycats? This paper presents global trends, the different business model options and introduces the SafeNet solution for protecting and monetizing mobile apps. Global Trends Recent research tells us there are clear trends for global app markets. Though the US remains the frontrunner, Asian app markets are experiencing explosive growth. And over the past year Android app revenue growth is outpacing iOS. Read on for more detail on each of these and other trends. Growth & Evolving Markets The US remains the most lucrative apps market in the world but if we look at growth year over year, Asia shows the most growth with triple digit gains in South Korea, China and Japan. And western developers are increasingly gaining ground in Asian markets by using cross-cultural strategies, such as localization. Freemium Boasts Greatest Revenue Share When evaluating the money makers, recent research indicates that, at the beginning of 2013, the percentage of app store revenues from “freemium” apps – those downloaded for free and featuring in-app purchases – was 77% in the Apple App Store and 89% on Google Play. By November, that had increased to 92% and 98% respectively. The freemium option continues to be a successful business model and has gained the most revenue share of all business models in the last years. This trend is expected to continue. Android Apps Gaining Market Share Since the dawn of mobile computing, Apple has been the frontrunner in the app market. Though the iOS App Store is still leading in terms of revenue, Google Play’s revenue share is increasing rapidly. For example, on a typical day in November 2013, Distimo estimated the global revenues for the top 200 grossing apps in the Apple App Store at over $18M. The estimate for Google Play was about $12M. When comparing to the same period a year earlier, their estimates were at $15M for the Apple App Store and only at $3.5M for Google Play. As this example illustrates, Google Play is grabbing revenue share at a rapid pace with an impressive 243% increase year over year. Gaming Tops the App Charts Though there are apps in many categories such as productivity, music, navigation, etc., the vast majority of mobile app revenue is generated from the Games category. Gamers are dropping their Nintendo and PlayStation handheld gaming devices in favor of playing Game apps on their Android and iOS smartphones and tablets. How to Protect & Monetize Android Apps 2 Using SafeNet’s Field-Proven Sentinel Software Monetization Technology Whitepaper When you look at both free Mobility in Business Means More Business Apps and paid business models in Mobility means more devices, more locations, and more business apps. According to Forrester combination with the option of in- Research, the number of anytime, anywhere information workers — those who use three or more devices, work from multiple locations, and use many apps — rose from 23% of the global app purchases, you see that they workforce in 2011 to 29% in 2012. With tablets tripling to 905 million in use for work and home represent the business models globally by 2017, the anytime, anywhere work trend is definitely here. with the highest revenue volume for software developers today. Given these trends, app developers would be wise to evaluate their current software licensing and business models to ensure they’re not leaving revenue on the table. Just as important, developers need to secure their revenues by protecting their valuable intellectual property investments. Choosing a Business Model The most commonly offered business models by both iOS and Android app developers today generally fall into one or two overarching categories. Developers are either offering free downloads of their apps, or they are charging for them. Some developers allow in-app purchases and some do not. The four most common business model variations used today by both iOS and Android developers are shown below. Free Apps Free apps are those similar to InstaGram where users can Common Mobile App Business Models download and use the app for free. Users like this business model because there is no cost. In an effort to monetize their development investment, app developers using the free app FREE APPLICATIONS business model commonly generate revenue through third-party advertising within the app. FREE APPLICATIONS Free Apps with In-App Purchases with in-app purchases Also known as “Freemium,” the free app with in-app purchases is a popular business model for app developers and to date, has also proven to be the most lucrative model. With this business model, PAID APPLICATIONS developers offer free downloads of their apps and then proactively with in-app purchases entice users with added features and functionality through in-app purchases. PAID APPLICATIONS For example, the maker of Candy Crush, a popular game app, uses the freemium business model to offer free downloads and play of its game, and then generates revenue by selling virtual items that can enhance game play or help players advance to new levels. Paid Apps with In-App Purchases The paid app with in-app purchases business model is very similar
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