Much has been talked about mobile developer programs and how many developers earn more revenue, improve cpms and how it helps them get going in launching free or fremium apps using advertising as a really sustainable business model.
Lets go a little bit deeper to understand how this really works?. Ad networks or sometimes carriers announce mobile developer programs worth millions of dollars. The promise is that you as a developer get 100% share of the advertising revenue generated or the download charge (on a carrier). Sounds great isnt it?. Yes it does but the truth is far from it and here’s why
a) It is a way to blow VC money and to raise more funds: One problem is that companies have raised more money than they should have and they should be raising. Much more money than they need. So, how do you spend it?. Simple, launch a mobile developer program and travel everywhere, including Mongolia (no offense dear Mongolians) to promote it.
b) It is not a sustainable business model? Why?. simply because VCs want to see exits with high valuations soon so the company is basically being prepped up for a sale or for an IPO to raise further money. It is not sustainable because there is no way the ad network or anyone else could operate if this was their primary business while spending 100% of the revenue that they are earning. Sure it is a great short term strategy to kill or overwhelm the competition. But assuming that the competition has survived ..it will probably take the market away from such networks through real innovation in technology and services.
c) It does not reflect your true sustainable revenue run and there is no way you are going to be comfortable if revenue falls by 40% after a few quarters of great growth. Consider this – the revenue that you might have earned through developer programs are nothing but short term bonuses. These programs cannot and will not last forever and that means when the programs ends, the revenue is going to be falling atleast by 40% (assuming thats the share of the network).
d) Problem of transparency: Most networks might even claim that they are giving away 100% revenue share. But how sure are you as a developer that you are actually getting 100% revenue share? How do you ascertain this, when you really dont have access to the campaign lists along with their CPC / CPM prices?.
So what does a developer like you do?. To cut it short, I’ can only say one thing for now – make hay while the Sun shines. But even then – don’t send all your traffic to a single network. When the funds run dry (on the dev programs), move on to a network partner that is transparent, accessible, has coverage in your markets and most importantly makes payments on time.