In 2008, Google originally only intended to collect a small charge to cover the costs of handling and billing on the Android Market, which would only amount to 5% of the app store proceeds as revenue share. However, by H1 2020, the Google Play Store made a substantial $4.4 billion in operating profits.
Today, when we think of Android phones, we think of devices that have access to a wide variety of third-party apps and games, all thanks to the Google Play Store, which is part of Google Mobile Services. The Play Store has become an essential part of the Android experience, even though Google didn’t expect it to grow this way in the early days of Android.
The Epic Games vs Alphabet lawsuit currently underway has brought to light the fact that in 2008, Google did not plan to make money from the Android Market. The lawsuit also revealed that in 2020, the Google Play Store had a 65% operating margin and accounted for a $4.4 billion operating profit in H1 2020, indicating rapid growth.
The fact that Google did not originally intend to profit from the Android Market shows how even they underestimated the potential of Android to become the operating system behemoth it is today. Back in 2008, it would have been hard to imagine that the smartphone market would become an Android-iOS duopoly, but the success of Android has indeed proven otherwise.