Google may be activating 300,000 new Android devices every day, but when it comes to the mobile platform with the best application ecosystem, it’s hard to beat Apple and iOS.

The Mountain View-based company, however, is hoping to change that, and last week announced a major update to its Android Market client. Here’s the update’s good, the bad, and ugly.

The Good

Google’s Android Market update contains some common sense and long-overdue improvements. Google has cleaned up the interface in several key areas, including the home and category screens. On the app details screen, users no longer have to navigate across multiple tabs to view an app’s details.

The search behemoth has also broken widgets and live wallpapers into their own categories, which should help discoverability.

On the developer side, Google will be increasing the allowed size of Android Package files to 50MB, and is adding better targeting features so that developers can make sure their apps are being delivered to the right users based on factors like screen size and density.

The Bad

In an effort to make developers a happier bunch, Google is eliminating its 24-hour return policy for Android app purchases, which gave customers a full day to decide whether or not to keep an app. Developers, for obvious reasons, had legitimate concerns about the length of time permitted for a refund decision. But Google may be shooting too far in the opposite direction: the Android Market update gives app buyers only 15 minutes to request a refund.

In some cases, 15 minutes may not be enough time to determine that an app doesn’t live up to expectations, or work as described. And 15 minutes simply seems like a very short window, which could actually harm developers.

After all, if potential customers know they have a quarter of an hour to test drive an app, many will probably be far more choosy about which apps they purchase in the first place. Which begs the question: is it better to have lower purchasing friction, but conceivably more refunded purchases, or is it better to increase purchasing friction to reduce refunds?

In my opinion, the former is almost certainly preferable. Developers should be confident in the value of their apps, and those who are offering up good stuff will probably be hurt by the friction Google is adding here.

The Ugly

If there’s ugly in Google’s Android Market update, it’s what isn’t present: a major overhaul to payments. Arguably, payments are the one thing that is holding Android Market back at the present time. Android Market’s lackluster payment process, which relies on Google Checkout, is so unappealing that prominent developers are opting to implement their own payment solutions.

If Android’s momentum in the adoption category is to be equaled by its adoption in the monetization category, Google’s next big Android Market update should focus almost exclusively on payments.

Photo credit: laihiu via Flickr.