In May, a pair of reports painted a troublesome portrait of the app economy on Google's Android Market. First, mobile analytics firm Distimo found that the vast majority of paid applications were downloaded less than 100 times, and a few days later, mobile search firm Chomp reported that 97% of all Android downloads on its service were free apps. For developers, the takeaway was that if you want to generate revenue for your mobile application, you have to think outside the "paid app" box.

However, that's not always the case. Although it may be a rare example, SPB Software has managed to have a revenue-generating hit on the Android Market with its SPB Shell 3D application, which earned the company $750,000 within its first three weeks of availability.

How could SPB do so well, when so many others are struggling. The answer is deceptively simple. Make an amazing app that people want, price it high and lock it down.

What's SPB Shell 3D?

For those who don't know, SPB Shell 3D is what's known as a homescreen replacement application. This type of customization is hugely popular among Android users who relish the ability to truly personalize their phones in ways their iPhone-toting counterparts cannot. A number of homescreen replacement apps are available on the Market today, including popular programs like LauncherPro, ADWLauncher EX, ADW.Launcher, GO Launcher EX, Regina 3D Launcher, Zeam Launcher and others. Most are offered as free products with premium upgrades available on the side.

SPB Shell 3D went a different route: price the whole program high, and include everything.

So what makes SPB Shell 3D stand out? Well, did I mention it's awesome? This program offers a 3D homescreen and built-in 3D widgets, smart folders, animated panels and more. It's fast and frankly, it's just great eye candy.

Gadget reviewers, who had been waiting for the app's arrival for a year, tended to agree. SPB Shell 3D received rave reviews  - Engadget said it was buttery smooth, AndroidPolice dubbed it "impressive," and ZDNet said it was "as useful as it is gorgeous."

It should be noted though, that the app doesn't run as well on some devices as it does on others. It struggled a little on my Nexus S, but ran well on my HTC Sensation. That may be due to the software's more recent optimizations for Qualcomm chipsets, but it could also simply be a case where the app just works better on more modern and powerful devices.

Case Study: 50,000 Copies at $750K in 3 Weeks

Of course, the app's high price turns many potential users away, and you can read the complaints in the user reviews from those who expected more for their money. But for mobile developers, SPB Shell 3D is a case study worth noticing.

Three weeks into its launch, the company sold 50,000 copies of the program, to the tune of $750,000. The app is priced higher than what users typically expect on Android: $14.95. Today, SPB Shell 3D has reached 70,000 downloads.

A key component to the app's success is the security model it uses. With proprietary technology, the app is locked down to prevent piracy. That's why the app is listed in Google's Android Market, but not Amazon's. The Amazon Appstore for Android doesn't offer strong enough security, a company spokesperson says.

In addition, the company has a business model that doesn't force it to rely on paid downloads alone. SPB Software also licenses its technology as a white label product. For example, in Japan, it worked with Fujitsu to create the interface for NTT Docomo's Regza Phone T-01C. What that means is even if the downloads hit a plateau, the app's makers don't necessarily have to lower the price to continue to grow the business - they can just focus on their partnerships.

While the app's makers may eventually have to cut the price down if they want to grow their B2C install base, there aren't plans to do so at this time. As an Android user, you may or may not care for the app or its price, but as an Android developer, you can't help but be a little inspired. Some apps do sell on Android, even when priced outrageously high.