It turning out that the real issue for developers on the Android Market is returns. Android allows a 48 hour refund period. People are using this as try ‘before you buy’ and are returning a large percentage of purchased applications.

Feedback on the Google discussion groups shows that returns range from 10% to 60%. However, there’s an amusing post by Mattaku Betsujin who has achieved a zero percent return rate. This is due to only one sale… to his mom!

More seriously, it’s interesting that this business model prevents the need for demo versions of applications. However, I am concerned that it’s open to abuse from people who never really had any intention of paying, especially for applications like games, where you can get some good entertainment for free for 48hrs.