Piracy Dramatically Impacting Sales of $10 Billion Mobile App Industry

By David Tobia
November 7, 2012

Piracy has turned its attention to the $10.1 billion mobile-app business. “The order of magnitude is tens of thousands to hundreds of thousands of dollars in losses per developer,” notes Carl Howe, VP of researcher Yankee Group, adding that sales might be 20-50 percent higher without piracy.
“There are lots of ways to steal an app; it usually involves copying its code and publishing it on an online forum or a legitimate app store,” writes Businessweek.
App piracy is different than other types of piracy because it often targets students or small firms that do not have the means or resources to pursue piracy.
The issue is especially problematic on Android, as according to Howe, Google’s “tools have been relatively ineffective because there are multiple Android stores, and Google can’t possibly control all the non-Google stores.”
Google hopes to combat the issue by offering encryption keys with paid applications to verify that the app matches the device from which it was purchased. This is intended to avoid copying the code and redistributing it to multiple devices.
Other app developers are turning to anti-tampering tools from companies like Arxan Technologies, which help monitor and fight piracy.
Many developers have switched to the freemium app model because it shows advertisements both to legitimate downloaders and to pirates. Other developers convince people to download the real version of the application by offering frequent updates.

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