Entries RSS · iPhone's app strategy and its implications for other smart phones
If you think about how the iPhone was launched so many months ago, or rather at what stage the iPods were at, you know that apps were always on the horizon. The iPod G5 introduced a wider range of games that you could buy through the iTunes store, which already introduced us to the idea of buying apps, well games really, through that venue.
When the iPhone arrived, there were NO apps; App-support was basically web-coded widgets with limited functionality. The reason for this was, I believe, that there was no competition to speak of + perhaps the complexity of setting up such a venture. Apps for other phones existed, ok, but it was either in a decentralised fashion (Java for instance), or very centralised and very limited in its offering (e.g. Blackberry & Palm), at least compared to the current iTunes store.
It took pressure from the market [jail-breaking & media] and perhaps already the idea in the back of Apple’s heads to release the app-store a little over a year after the initial device was launched. When it did launch, there was lot’s of hype, lot’s of love, and good news for Apple iPhone numbers both on the device-sales side and that of app-sales.
How the other device makers reacted was two-fold and really quite half-heartedly. Most hardware makers focussed on what they did best: hardware. Touch-screen after touch-screen device entered the market. The most interesting software-based strategy came from Google, which, I guess, realised the potential of mobiles as computing platforms and, more importantly, as search/internet/”revenue for Google” enabled devices in everyone’s pocket.
The current app-store offerings are still lacking with many big parties attempting to launch one for their platforms. The key-factors in terms of adoption seem to be having a critical mass of both users and developers, both of which represent a chicken & egg problem for many, something that the initial iPhone circumvented quite elegantly.
The most promising devices today are Google-/Android-powered phones and the, still somewhat vapoury Palm Pre. The latter seems to be the most competitive, hardware-wise, with much ex-Apple talent having contributed to the Pre’s development. On the App-store front, it’s still very early days, but reports are disappointing.
So, the question is, what can phone-makers and software-makers do to compete with the new “Microsoft” (=Apple) of the mobile space? The choice, to me, appears two-fold:
- Emulate Apple in whatever way possible: create a great device and create an app-store with a sufficient supply of apps.
- Or, create a great device and find a way to elegantly get apps onto it, without all this centralising nonsense.
By the wording, it’s obvious that I prefer the second option. As good as the iTunes store is, it isn’t amazing for developers and it isn’t as profitable for Apple as one would think either. The biggest problem for competitors is similar to the music-situation, that Apple has critical mass, which attracts the greatest amounts of customers and is a nearly insurmountable challenge for new entrants.
Where Apple clearly leads is in its developer-support, which isn’t quite as apparent from other software/hardware makers, except perhaps Microsoft (but mainly on the PC-side) and perhaps Google. Palm, as yet, does not offer a comparable service to developers, or to put it in another way, Palm developer conferences are not yet sold out in the way Apple’s WWDC is each year.
Final thoughts:
- I think that developer support is key in any smart phone strategy these days, as mobile devices continue to become computers in your pocket.
- I don’t think that centralised app stores are necessarily the way to go, except (and I suspect this) if the mobile carriers are demanding it.
- The simplest thing would be to create a web-based categorised list of a apps that developers can add to;
- implement mechanisms that vote and demote apps according to their usefulness and other attributes;
- and create / implement mechanisms that prevent abuse (e.g. P2P apps or VOIP apps, though I think the latter can no longer be considered this)
- And continue to innovate on the hardware, because I think there is plenty of innovation left. What makes the iPhone so desirable is the app-support, but the hardware is really nothing to write home about.
Note: I purposefully left the links towards the end, because it allows for a more time-efficient, easier to write (and, maybe, read) article. Links with additional info are included in below list:
- Mossberg on Palm Pre
- Apple App store numbers
- The incredible app store hype (one of many developer complaints)
- Palm developer network
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Tags: app store, itunes, palm pre, smart phones
Apple, Architecture, Business Process Management, Business intelligence, Business strategy, Consumer electronics, Design, Economics, Entertainment, Future, Gaming, Internet, Nokia, Palm, Software, Supply Chain, Technology, Telecommunications, USA, Web-services, Windows, innovation, marketing, media, mobile, open-source, retail, user-generated content, web2.0, web3.0
Hey Vincent,
I have been following this blog for a little over 1 year now and I thought I could finally give you some real feedback…
I think you are right about that the developers are pushing the iPhone platform. And that is the reason why other vendors just dont have as much success with their smartphones lately. The iPhone provides the developer with fairly good tools as well as a good hardware. We are now in G2 with the iPhone, so the hardware is pretty much still the same. Now think about being a developer for the other vendors who use Windows Mobile on their devices. It can be quiet irritating to write a program for one device that just wont work on the next one, cause there is some feature missing from it. Apple created this stable environment for developers and thus they jumped on the bandwagon.
Furthermore i think the reason there are so many developers for the iPhone is that there is such a centralized Appstore dedicated to their work. It is easy for a spare-time programmer to create a small app and just put it out there. Otherwise he would have to create a small webpage that looks more or less professional, which would cost more time. Besides, the user who actually downloads the app from the Appstore has somewhat of a guarantee that the software is “safe”.
I personally dont agree with the way Apple handles the authorizing process of apps, but thats just my personal opinion…
If Apple is the Microsoft of the mobile space, does this mean Nokia is the IBM of it?
I would still categorize Google’s current Android phones, Palm Pre and iPhone as high end, early adopter devices. I’d imagine the user bases are quite homogeneous. The only difference here is that only iPhone aims (through design and marketing) to be a smartphone for everyone. Now, this has been a strategy for Nokia.
Nokia does have Symbian in pretty much every mid- to high-end phone these days and has been struggling with app stores and web services for a long time. One of their main problems seems to be that their user base just isn’t interested. Earlier Nokia was trying the strategy 2 (decentralized), but is now trying 1 (app store). The other problem, is the developer problem, seeing that they don’t even use their own SDK internally, why’d anyone else bother?
I would argue that both Nokia and Google try to move software from the phone to the internet as services, whereas Apple is cashing on the software in the phone with its App Store. The main gripe I have about Apple’s App Store is that one of things that I enjoy about using Mac OS X is that it comes with “batteries included” – you’re up and running almost instantly, whereas on Windows side you need to install a load of 3rd party software before you have a decent setup.
This has lead to a situation where the comment I hear most often about iPhone is how the device itself isn’t that great as a phone, but apps are nice. This is a stark difference to what people say about other Apple hardware (iPhone, Macs).
For example, looking at the Nokia Morph concept you have up there, you can see that the “mobile phone” is divided into parts or interfaces. It’s more of a user agent for different applications (as in use, not software) than a thing. Google on the other hand, doesn’t care which browser or device you use to access their services as long as you do (and has created Chrome and Android to guide development in those areas to where they’d like).
As a hardware manufacturer, Nokia’s biggest mistakes have been not to figure out US markets and not being able to launch a smartphone “for the rest of us”. Their most compelling smart phones are still in their business E-series, while the N-series tries too hard with an user interface only their developers can love. What Nokia, on the other hand, can do is make smartphones a commodity. That would make Nokia the Microsoft of mobile space and put Apple as Apple of mobile space.
We’ve been working on the usability problem for a bit, having discovered that Apple isn’t. Wrote a couple of relevant blog posts:
What’s missing from the iTunes store: http://www.appstoresocial.com/blog/2009/2/28/what-is-missing-from-the-itunes-app-store.html
And, why I think Apple’s not gonna fix it: http://www.appstoresocial.com/blog/2009/4/24/apple-thinks-app-discoverability-is-under-control.html
Really, it’s up to us to build a better app store and get people to use it. If we wait for Apple to do it, we’ll be waiting a long time. iTunes was never a great music shopping experience, but it was always good enough to sell iPods – same goes here, I believe.
Welcome Toby
And a nice long comment, just what I like.
You raise a good point about the need to create a personal space for you app as a developer, if a centralised app store does not exist. With regular software, of course the budget for creating dedicated websites, etc. is higher, than for a $2-10 app developer.
Two negative things that I’ve been hearing a lot regarding the app store, is its design and the authorisation process. Design-wise, it’s very difficult to get noticed and developers seem locked into the “iTunes way,” which is “here are the top-apps, good luck finding the rest of it.” Authorisation-wise, you already know the surreal bans that have been happening these last few months (the dumbest one was really the rss-reader, which had a swear-word in its feed).
That, together with mobiles becoming PCs, lead me to believe that perhaps we need a more PC-like marketplace for mobiles, in other words through the internet instead of iTunes. I don’t really think that this requires each developer to set up their own space (even though I do think marketing is a crucial investment into any commercial software business), but more using the collaborative advantages that the internet offers (voting on apps), together with a simple, web-based store, that also is better designed.
In the end if developers act like the flock, by just submitting their apps and do nothing in terms of marketing, they can’t really expect to make much more than the flock, except if their app is really exceptional…
The standards-point is definitely a good one too. I don’t think that, unless devices decide to use the same code-base, this problem will ever be overcome. I suppose it is hopeful that both Android and Palm are more focussed on web-apps (correct me if I’m wrong), but whether they will be on par with iPhone apps, I can’t say. What is sure is that these “language islands” create the incentive for developers to focus on one platform only and the critical mass of apps and consumers will lead towards one, not multiple winners. Other variables such as company adoption play a part as well though.
So what is your conclusion?
My conclusion? Well, I think pretty much all the competitors are trying to emulate Apple on both the hardware and app store fronts. Apple’s advantage is in the user experience and hardware design and in my opinion a mobile phone shouldn’t primarily be a platform for apps, but somehow everyone thinks that’s where the money is. We have already seen this happen. My gut feeling says that this whole “apps” thing will blow over and Google will win, because it is the only “mobile” player who makes money out of internet usage (in addition to operators). (On another note, I think Google doesn’t hate anything as much as SMS messaging.)
The operators will fight tooth and nail not to become bit-pushers and probably are betting on Android, which allows them to brand the experience and harass the customers as usual. Nokia knows that bulk of the profit comes from the cheap handsets sold to operators and probably doesn’t want to screw them over. This is the reason why Ovi Store is full of ringtones and wallpapers. Nokia knows that for the low- to mid-end operators will just buy phones from Samsung or some other and the end user doesn’t care.
Apple, on the other hand, could go to the operators and show them an iPod and tell them to trust Apple to make money for them. It’s stupid, but I think all the players should focus on their core (Google: apps, Others: phones). They don’t have the competitive advantages Apple has: design & user experience, iTunes, OS X technologies or a board chair at Disney.
Well, I don’t really see the connection between Disney and Mobiles right now, but yes any powerseat is an advantage in some way or other.
I don’t think the apps thing will blow over at all, as I see mobiles essentially becoming laptop replacements (within realistic limits of course) and consumers will expect the same software flexibility. Internet via mobile will also (need to) become more commoditised with less involvement from carriers and bandwidth restrictions.
Any too hardware-focussed company will eventually fall into the same trap that IBM did in the beginning of the PC days, with them being perceived as commodities. For some, like Nokia, Motorola, etc., having been the slaves of the carriers for over a decade, it may already be too late.
The future may just be the Mac vs. the PC all over again, with all-in-one solutions coming from Apple and software-only solutions from the likes of Google. Like you say, each focussing on their strengths, and no one trying to do everything.
But as Toby said, standards are the issue here, which is determined by reaching critical mass. And whether Apple can serve the whole market, that I am not so sure of.
Yes, there’s no doubt that the app-store is good enough. But the apps are just for iPhones which are just one smartphone with many others on and entering the market. The question is, should these devices each build their own appstore and how will they encourage software development on their respective platforms.