UPDATE: Mobihand Possibly Nearing Bankruptcy: Doesn’t Pay Developer(s)

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We received an interesting letter from an app development shop that sells their apps through Mobihand. Mobile Stream is apparently owed a total of $163,976 from Mobihand, and it looks like the 3rd party app store is keeping mum about whether they plan to pay any of the money owed to the developer. Read more after the jump.

Mobihand
Mobihand traffic

According to developer at Mobile Stream, the money owed dates back to July, and attempts at collecting the money have not been fruitful. Mobile Stream has told us that Mobihand’s response has been simply to tell the company to keep quiet, writing them emails saying “it would be helpful if you would not make this information publicly available. Publicity about this could damage our ability to resolve the problems and generate cash.” When asked specifically about the royalties and if a payment schedule can be negotiated, Mobihand replied saying “We don’t know when or how much. We don’t know if the complete amount will be paid before the end of the year. We hope so.”

We have written before that Mobihand is likely having cashflow issues as the company changed its pay schedule with developers and publishers. If a company is pushing back the dates at which it has to pay out, it’s a clear indication that something is going wrong.

After pinging a few other developers to see if this is an isolated incident, we got some troubling feedback from a popular BlackBerry app developer who said their August payment was delayed and they needed to ask for their money. In the end it was paid, but probably because this company is one of the few keeping Mobihand alive.

This same scenario happened with Handango before it went belly-up. First, the company raised their take on apps, then a few months later they changed the payment schedule. After that, the company started missing payments and shortly after the company went bankrupt.

We’ve also heard that some big developers are seeing tremendous drops in their royalties from Mobihand. Some big titles are seeing a drop of 40% per month. In the end, all signs point to the company being on a path to bankruptcy.

UPDATE: Just came across something interesting and I’m not sure what to make of it yet. It looks like the same person who emailed us, Anastassiya from Mobile-Stream, also emailed a Palm/Web OS blog back in the day with a nearly identical problem. Apparently, Mobile-Stream hadn’t received payments from MyTreo.net and complained. The developer received payment and MyTreo.net was bought by Mobihand.

Click here to read about Mobile-Stream’s issues with MyTreo.net.

We’re still pretty confident that something isn’t right with Mobihand’s cashflow, but it’s curious that this is a common problem with Anastassiya.

UPDATE #2: Here is an update from Anastassiya regarding the MyTreo.net issue:

The issue with MyTreo.net was three years ago. It concerned not only me, but other developers as well. Maybe the debt to me was more that the debt to other developers, that’s why my apps and my name are mentioned more often. 3 years ago Card Reader and USB Modem were two best-selling Palm apps at MyTreo.net, that’s why those financial difficulties hurt me more than other developers.

By the way, this issue with MobiHand has happened not only to me, but also to many other developers, including some popular BlackBerry developers, just read this:

Several developers such as nikkisoft, bellshare and others have already pulled their apps from MobiHand completely.

UPDATE #3: Mobihand has confirmed they are experiencing financial troubles.

  • http://twitter.com/BerryGoodThemes BerryGoodThemes

    i had to email mobihand to get my september payment which was late, and i have seen a massive sales decline since appworld started 99c apps our sales are down from several thousands of dollars a month to barely a hundred bucks a month!

    mobihand unfortunately will be dead by christmas!
    feel sorry for the store who are owed so much!

  • http://about.me/kylemcinnes Kyle McInnes

    I hope this situation pushes RIM to start their affiliate service.

  • http://about.me/techncode Mauricio E.T.

    Me too. Let’s go RIM!

  • http://about.me/kylemcinnes Kyle McInnes

    It’s also worth mentioning that we’ve heard RIM confirm that App World will be the only place you can download BlackBerry apps going forward. So Mobihand won’t be able to carry BBX apps and losing all its BlackBerry revenue a few years after the BBX launch.

  • Sam

    What’s gonna happen to all our apps we’ve all bought from Mobihand over the years? Anybody have any idea?