The mobile app market is maturing fast and as a developer with a successful app in App World, I wanted to prompt some debate on what the next wave of app stores will be like and how we can work together to get there.
Round 1 was started by Handango, and quickly followed by Handmark and MobiHand among others. Their global presence enables developers to deploy once and see their app appear on the Internet and on multiple carrier and affiliate sites. However, download volumes, on-device discoverability and ease of payment were historically poor. Interestingly, none of them (apart from GetJar) focused on free apps. Meanwhile, the carriers were rolling out their own app stores where the majority of downloads were ringtones, screensavers and games, but that was valuable because it educated their customers that downloading apps was possible. In summary, round 1 was the “for profit” app stores. As developers, we have a lot to thank those pioneers for.
Round 2 was app-solutely started by Apple! Their app store was bundled on every handset, and was integrated with Apple’s payment system, enabling developers to suddenly reach massive numbers of Apple users. Apple also perfected the OTA (over the air) download making it so much easier to install apps. Apple has proved that apps sell phones and that users have huge appetites for customizing their phones with apps. However, their policy of allowing free apps and $0.99 apps has caused a lot of price pressure for quality developers. Also, their policies of approving every app at their discretion, and of not embracing the carriers as a channel to sell Apple apps, are not without their critics.
Then came RIM with BlackBerry App World. Although App World will never be the Apple App Store, as a BlackBerry developer I would argue that in general, RIM’s store has higher quality apps, less clutter to sort through, a credible PayPal payment implementation, a very equitable revenue share, and they have created a better opportunity for quality apps to get to the top of the pile. In summary, round 2 was the “not for profit” handset app stores, where the main benefit to them was selling more phones. The benefit to everyone else has been the meteoric rise of the “app economy.”
So what will Round 3 look like? As the app market matures and users crave more sophisticated apps and services, billed in more creative ways, I would argue that the app stores of round 3 need collaboration between the handset manufacturers and the carriers. Apple and RIM have established an unassailable position in many ways, yet the carriers have a huge and unfulfilled part to play. Why?
1) They can greatly aid discoverability and recommendation because they know so much about the user.
2) They can bill the user in so many ways, including pay-per-use and subscription, directly onto the user’s mobile bill.
3) They can bundle apps with rate plan packages, e.g. a certain BlackBerry plan might include a bundle of apps.
4) They have sales teams and dealer networks that are in tune with the needs of their customers.
5) They are opening up their network APIs so that developers can provide greater capabilities; presence and location are just two examples.
Right now developers have a dilemma: when they build richer apps will they go deeper into the handset OS functionality, or deeper into the network capabilities? As collaboration continues, I hope the answer is “both.” As an example, Verizon is working with RIM on its Vcast app store, and RIM is working with carriers like Verizon on carrier billing of apps. A good start. Now, imagine a world where a resource-strapped developer can quickly develop a sophisticated app which takes advantage of the best APIs that RIM and Verizon can offer, and can monetize that app, all in one go. Then the wireless industry will have a “round 3 of the battle” where there is no battle because everyone – OEMs, carriers, developers and end users – will win.
Terry Hughes is the President and CMO of Widality – the company behind momentem, one of the most popular business applications in BlackBerry App World.