How does Google make money from Android


# How does Google make money from Android?

When Google announced that they were purchasing what was the Android operating system - an operating system for mobile phones - everyone thought immediately that the Google cell phone was coming into business, maybe cellular carrier business too.

Rumors of a “Google Phone” started to course. It was to be free, and you'd never need to pay another cell phone bill again.

At least that’s what the rumors hinted at.

We all know that didn’t happen. Google doesn’t make hardware. They don’t even have their own handsets any more (long live the Nexus One!). Google doesn't "possess" Android. Google released Android as Open Source, essentially giving it away for free to anybody that needs to utilize it.

![How does Google make money from Android](https://lh3.googleusercontent.com/rf4byMbxLKPuzALA3Py7gcql94HEZV-XQhjyELSwu3_mb-79pnGKL-khQmuhRwEW5GsEy1oLxry-6gzaK5Zgb8yrmDKpL2YEOBBoXQegbsRK1lfFB3-Iyv7_fV7I2g6LfP5DwwgH "How does Google make money from Android")

In short, Google does not make money from Android - not from the OS. With every one of the hours they spend adding to the Android Open Source Project, Android actually costs Google money — a lot of money.

Last time I checked Google isn’t running a charity.How can their shareholders be happy with throwing money-hand-fists on Android? I am glad that you have asked shareholders.

Google asked them to believe them until for the time being. I think shareholders are happy with Google's progress with Android. But to see why, let’s dig a little deeper.

## Mobile advertising

Mobile ads are clearly the main source of income for Android. Google paid $ 1 billion to Apple as the default search engine for the iPhone and iPad in 2014.

It's just for tax that Google has to pay for the privilege, so the actual iOS revenue is a little bigger.
iOS users are increasingly attractive compared to Android users in terms of advertising because, on average, they have a large income and they are more likely to buy online goods.
But Android users are much more various than iOS users. In September 2015, Google said there are 1.4 billion Android devices worldwide. Even with a lower average revenue per user, the money that Google makes from ads shown on Android devices is probably fundamentally bigger than the iOS revenue. And, there is no Apple tax to pay.

Even with the average revenue per user, Google earns money from ads shown on Android devices, which is probably bigger than the original iOS revenue. And, do not give any Apple tax.
  
When users search through their apps and online, Google earns money from advertisements that are displayed.

Numerous individuals also use Google Maps, YouTube, Drive, Gmail, and Google’s numerous different applications and services. Google shows advertisements in a portion of these services, but it also analyzes user data to improve the relevancy of the ads it serves in other places. And, because every phone user has to sign in with their unique account while setting up the phone, the data is accurate and highly personal.

Whenever you click on one of the ads shown in many ad-supported apps, Google also makes some cents.

Now mobile advertising gets Google less money than computer searches, because the value of a “click” is commonly littler. But mobile usage builds each year, and gratitude to Android and its suite of applications, Google has a network of capillaries extracting money out of the entire ecosystem.

## Apps

Applications are the second big source of money for Google. The company takes a cut from each sale app developer make on the Play Store. And it's a major store, with over 1.5 million applications, out of which a major piece are paid applications or apps that offer in-app purchases. Google takes a 30% off each sale, offers some more basic infrastructure in exchange for the platform, which includes Cloud Framework to convey the notification.

Android applications will in general less revenue compared to iOS applications, for a similar reason iOS users tend to be more valuable from an advertiser’s point of view. Revenue from Apple apps is 70% bigger than Android applications revenue, despite the fact that Android apps have double the quantity of installs.
Thanks to the huge size of the Android platform, it is safe to say that Google earns a good amount of 30% of your app revenue.
That throw is just getting greater, as Android application installations keep on developing quickly.
During Google I / O 2015, Google said that in 2014 alone, it paid developers $ 7 billion. In 70% of the developer share, the revenue from the Android app was 10 billion dollars in 2014.

## Play Store media

Google additionally makes some money from the media side of the Play Store. Paid music, movies, books, and subscriptions are only a tap away for a huge number of users, so even with a low usage rate, it's reasonable to assume that there’s a steady trickle of money coming in from this source.

## Everything else

App sales and mobile advertising are the biggest sources of Android revenue for Google.

The organization sells some hardware, but with the small profit margins that hardware allows,that cash is generally insignificant. The same can be said about undertakings like Android Pay and Project Fi.

Google does not earn money from Android itself. Anybody can take the Android source code and use it on any device. Similarly, Google does not make money from licensing mobile android apps for its suits.
Applications like Google and YouTube are free, despite the fact that producers apparently host to pay third-party testing companies six-figure sums to ensure that their devices meet Google’s compatibility requirements.

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