It's competition. Yes, if someone can recreate your application for free, then your application wasn't as valuable as you think it was, by definition. Make a better app, or turn it into a service that generates revenue past app deployment.
I think many app developers have gotten spoiled by tales of people getting rich off of P.O.S. apps, and expecting that to happen to them. That happened back in the day because there was a scarcity of applications and app developers. That scarcity no longer exists. Most of the easy stuff has been done, and a lot of free versions have been made because, let's face it, most apps really aren't terribly complex.
So, make something big and hard to duplicate. Make it part of a service you provide with recurring charges and give away your app. It's a better model, anyway.
Games are a bit different given how much art and content is often associated with the production, but users are looking for a fun distraction. Perhaps one should try to build a $2 game with a $50,000 art budget rather than a $500,000 art budget. The users don't really care. It sounds more profitable. Tiny Wings FTW.
How is this true at all? It depends on the programmer, what they are building and the tools they are using to build it. Apps are no different to building desktop or web software. In fact the constraints arguably make it more difficult.
XCode and iOs have improved tremendously in terms of usability and functionality, compared to the first releases, and I expect that the Android SDK has gone through a similar evolution.
In addition, you'll probably find a tutorial or a Stack Overflow answer for every problem or question you could possibly have, while at first it was largely undiscovered territory.
In short, barriers of entry have lowered tremendously.
In other words, you are exactly right. They aren't providing value. I could write their app in one week, tops.
Do you have any articles about this? I would be interested in reading the arguments for/against.
Sure the app COULD gross more, but in my low talent niche, it is well known how much revenue MotoX Flashlight can generated. Should Google be allowed to publish my app, knowing it will never clear more than $500 revenue?
If so, why shouldn't they pay me $600 (still below min wage) to write the app for them?