Google Play Store is Certainly no Child's Play When it Comes to Making Money

It is no secret that a few years ago the iTunes/App Store sold a lot more apps and made a lot more money than the Google Play Store, but as time went on the Google Play Store grew, was refined, and, did I say grew.  If you go into the Play Store now and look around, you can see just how "enormous" the Play Store has grown - new categories, new format, in depth descriptions, and easy to search and get around the website.  There are over 1 million apps for downloading, tens of thousands of songs, and thousands of books, movies, and TV shows.

Each time someone buys an app, Google gets a cut, as well as money from the advertising - Google is all about advertising.  Google does not report how much it makes from its Play Store but Barron's analysts have estimated it to be about $1.3 billion on sales of $4.2 billion.  With the rapid growth of the Android operating system, analysts believe that by the year 2017, Google's Play Store profits could rise to $5.2 billion. Smartphones sales continue to increase, especially in the emerging nations, and Android now commands over 80-percent of the worldwide market - and everyone of those devices need apps.

Remember we said that Google is all about advertising and below is a chart showing estimated advertising revenues earn because of the Play Store:

All of this means that investors are being encouraged to purchase Google stock - Citibank's Mark May said:

This year has been a breakout year for Google Play.

In CY13, we estimate that an average of 909mn installed Android devices will generate on average $4.59 per device in Google Play bookings, which will result in $4.2bn in total bookings and $1.3bn in gross revenue for Google after paying out 70% of bookings to app developers.

All of his data leads May to raise his estimates of Google's 2014 Earnings Per Share (EPS) from $47.75 to $47.86 and their 2015 estimated EPS from $55.44 to $55.65. Let us know in the comments or on Google+ if you are a Google investor and how much you might spend in the Google Play Store during the year.

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About the Author

Cory McNutt

Senior Staff Writer
Cory has written for Androidheadlines since 2013 and is a Senior Writer for the site. Cory has a background in Accounting and Finance and worked for the FBI in the past. From there he pursued his Masters in English Literature. Cory loves Android and Google related technology and specializes in Smartphone Comparisons on our site. Contact him at [email protected]