Google looks to embrace carriers for app billing

For a company that likes to do things a little different, it’s odd that Google Inc. (GOOG) now finds itself striving to take up the status quo in the app space.
Just after shuttering its go-it-alone Nexus One sales system online, Google might soon be shifting course for its Android Market. Generally considered too cluttered compared to the App Store, the Android Market also suffers from a lacking billing system.
The company has updated its Android Market Developer Distribution Agreement to include the legal framework for new payment options, particularly direct billing relationships with carriers. In the agreement, “authorized carriers” have been added as an indemnified party, according to Google.
Popular opinion has it that countless developers and publishers are holding back on their Android plans until Google worked out a better method for customers to buy apps and for them to get paid on a grander scale in return. Currently, Android Market billing is only available through Google Checkout. Converting casual app enthusiasts into willing and paying customers has been much more difficult because of that requirement to sign up for Google Checkout.
After rather loudly trying to mix things up a bit in the U.S. market with a different approach to app billing, Google appears ready to now throw in the towel and embrace all the existing billing relationships that their smart phone customers have with carriers. It may be an old, tried-and-true model that carriers use to exert more influence and power, but it’s also one that developers understand and feel more comfortable with.
The iPhone isn’t the only reason Apple Inc. (AAPL) has carved out such a commanding presence in the smart phone arena. It’s the apps and Apple’s highly regarded App Store that help set it apart. Thanks in large part to the 100 million-plus customers with iTunes accounts and their credit cards tied to them, Apple swiftly converts phone buyers into returning app buyers.
Google’s attempts thus far to bolster its own billing system alongside Android Market might turn out to have been its Achilles heel. We’ll know for sure if the number of paying customers and available apps rise dramatically after these direct carrier billing relationships are put into effect.