Asking for a 50% cut for someone else's work (which, in his own words, "almost certainly won’t be worth the investment") on a platform he's been trolling for years? Is he dense?
Instapaper is not just the app. It's the supporting web service and brand too. It's not 50% of a new thing. It's 50% of instapaper for android which is nothing without instapaper.
And thousands of paying users.
That's the point of his offer. He doesn't believe that developing Instapaper for Android will be worth it, but if someone does, he's welcome to give it a try.
My understanding is that there's a large part of Instapaper is server-side. Since there's no recurring subscription, only an initial fee, the maintenance of the service for existing users is supported by the initial fee paid by new users. This model would not make it possible to allow the developers of clients for other platforms to keep all the revenues for themselves as the costs of maintaining the service infrastructure are non-trivial.
It's a dare, he is saying it's not worth it. But think for a second, what if he offers the same deal on the iOS? Definitely worth it, monetary wise.