Ilja Laurs on the virtuous cycle that's driven GetJar Gold past 50 million users
Not money for nothing, but close
The primary problem for developers of Android apps and games is users are only worth 20 percent of their iOS equivalents.
So, even though the install base of Android devices has outstripped iOS, it remains a stubbornly less lucrative ecosystem.
According to CEO Ilja Laurs that was the starting point for free app store GetJar's decision to roll out its own virtual currency for Android apps in early 2012.
And it remains the reason for GetJar Gold's continued success.
The currency, which is funded by developers buying free downloads with some of value passed to users who download those free apps and games, has since gained 50 million registered users.
"GetJar Gold is particularly important in regions without Google Checkout and those without widespread access to credit cards," Laurs explains.
"It's not real money so we don't have to worry about banking regulations. There's not even any pin required. It's the most frictionless payment system."
A real economy
Indeed, as he explains, it's the lack of money within the Android ecosystem that underpin the currency.
If users aren't feeding hard currency into the market, then the finances have to be based on a more subtle value exchange model; in this case based around the value of downloads to developers.
"If a company knows they can generate an average of $1-5 from each free download of their game or app, then it makes sense to encourage the download by passing on 50 percent of that value to the consumer to spend how they like in terms of downloading apps from GetJar or unlocking virtual items," he says.
Popular categories for the use of GetJar Gold include games, and dating, productivity and mobile security apps.
In this way, developers and publishers inject liquidity into the system, which is directed by the activity of users, before being finally accumulated by developers as users download their apps. Then they can cash out their GetJar Gold for real money at the rate of 90c on the dollar. GetJar takes a 10 percent margin.
Following the trade winds
Yet more important than how it works is the fact that GetJar Gold does work, and very well.
"We at least double revenue for our developers, while the increase can be up to 10 times in countries without support for Google Checkout," Laurs reveals.
Still, the US and UK remain the current biggest markets, with the likes of Russia, China, India and some African countries experiencing big rises in activity.
And Laurs expects the strong growth to continue.
"We're seeing an explosion in mobile marketing," he says. "Desktop internet marketing is dying. Everything's going to mobile and tablets. If you're a web brand, you can't afford not to be on mobile."
He also points out that marketing budgets are worth more than consumer spending power, further gearing GetJar Gold's potential.
"As we add more partners, there's more virtual currency and so we get a larger audience. It's a virtuous cycle," he ends.
Roll on the next 50 million users.
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