Some thoughts on monetizing apps running on Google App Engine

Thanks to the power of TweetDeck’s search feature, a routine scan of all Twitter posts mentioning Google App Engine revealed this posting by Lou Franco.

In it, he argues that App Engine needs an “App Store” along with a recurring payments system.

I believe that, at least to a certain extent, these things are already available and wouldn’t doubt that we can expect more in the future.

When tackling the question of monetization, I have to start with the assertion that, broadly speaking, there are two main categories of apps:

1. Mass-market/consumer Apps: These types of sites/apps are primarily supported through ad revenue. So presumably if you come up with a killer app that’s so popular it exceeds the free usage quota, you should have advertising or some other way of monetizing. If you use AdWords, having to pay Google for server capacity while they pay you for ad clicks is a little strange but one’s free to select other ad platforms. Alternately, these apps could be supported by subscription fees. More on that later…
2. Enterprise Apps: As I previously observed, the Google Solutions Marketplace offers a venue by which applications can be advertised Google Apps users can purchase and install AppEngine-based applications. These are almost always supported by some kind of subscription.

So, one can monetize an application through ads or subscription fees. Google clearly offers a means of providing ads, so I’ll move on to subscriptions. Google doesn’t currently provide a recurring billing mechanism. Presumably, at some point in the future, they might do this but in the meantime I’d consider Amazon Flexible Payments Service (FPS), a PayPal-like service that, among other things, supports recurring subscribtion billing. FPS can be easily integrated to AppEngine using the open source “boto” library, a Python library to Amazon Web Services that can run on App Engine.

Naturally, while I focus on App Engine, these models can be applied to any website/application regardless of how and where they run.