Though
Android increasing its market share in the mobile OS, the app store of Android is loosing. The bad news for Android developers is that 98.9% app downloads made from Android market are free of cost. The abundance of free apps helped Android market to surpass 250 million downloads but according to FADE report 8 million users downloaded 289 million apps of which
98.9% apps are free.

According to the report, an average Android user is spending just 6.1 cents on Android games and 50 cents on all other applications, where as an average iPhone user spends $1 on games and $5 on other apps.
As per the report, the low revenue from the Android Market is due to
- Payment UI
- Less number of paid countries.
- Android 1.5 is use on 30% of phones.
- Not supporting downloading apps to SD card.
If Android Market can improve in the above mentioned factors , then for sure Android will become a tough competitor to its rival iPhone.