Is there any reason to forward lock a free app? If the user copies the app from the phone, is it protected in any way from decompilation, etc?
By "forward lock" I'm assuming you mean "prevent a user from forwarding the app to another person", and by "free" I'm assuming you mean "available for zero money". If that is the case, then yes, there are reasons to do so. First and foremost, this will ensure that the app is only available from a single source and that users don't have to worry about whether the app is genuine or a tampered version. It is not unheard of for someone to take a freely available app, add their own ads or malicious code, and re-distribute the app as if it was the original version. Unsuspecting users end up running adware/malware without knowing it. This also (unfairly) gives the original app a bad reputation. Therefore, many free apps prevent forwarding/copying for the sole reason of ensuring authenticity.
Also, just because an app does not cost anything doesn't mean that there aren't trademarked/copyrighted materials (or other types of protected intellectual property) inside it that aren't legally copy-able. Being able to easily copy or dis-assemble the app could open the creator to legal issues (especially if they licensed some of their content from a third party), so a free app isn't necessarily able to be taken apart. That being said, binary code is always viewable in a hex editor, and anything can be dis-assembled if you have the time and patience...
No, because the implementation that the Android Market offers is multiply broken:
If you want copy protection, that's your call, but use something other than the one supplied by the Android Market.
While consumers bypassing the marketplace and copying a free app will obviously not directly affect profits, keeping track of the number of people using your app can be very important in terms of building the reputation both of the app itself and of your company / you as an indie developer.
If your app communicates with a server or central database as part of its natural functionality, then usage tracking can be implemented through that channel. But if not, then download information on the marketplace is the next best way to get a rough estimate of its popularity.
As for security, I'm not aware of any way forward locking directly makes your app more secure, preventing illicit copying could certainly serve to discourage untoward manipulation of the package files.
No, but it isn't particularly protected either way - it's possible to copy all the data off most android phones regardless of what the application developer would prefer, and once you have the bytes you can disassemble to your hearts' content. (Whether any of that is likely to happen to your particular application is an entirely different question).
There are other reasons to lock it - more accurate counting of userbase, etc. - but they're generally not worth the impact to the overall user experience. If your app phones home occasionally to count installed handsets, that's a much better plan than trying to enforce some way to trust the Marketplace count.
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