I’ve been keeping track of a very interesting thread at Forum Oxford (FOROX) on the topic of Android phone dissapointing developers (w.r.t. iPhone), with Jason Delport, Alex Kerr, William Volk (who started the thread) and others adding their different perspectives on the matter. All these guys are mobile experts so what they say resonate with me…

I like Jason’s responses as there is no bias, just pure pragmatism (i.e. he has been burned before); he makes a living building mobile apps, so for him it is about business and making money. Period. Jason’s take on why Android is dropping the ball is as follows:

  1. User’s don’t want to sign up to Google checkout
  2. There are plenty of places to find illegal copies of paid Android apps
  3. The store is over cluttered with crap apps
  4. The store has a poor design and has a rubbish user experience compared to the iPhone app store
  5. Paid apps were launched later than free apps and a tone was set in the market that apps were, and should be, free.

For which I respond as follows:

On #1, Google should do one of two: 1) require and capture credit card information the first time a user tries to buy a premium application, or 2) integrate with the network operator’s billing. On #2, true, but #1 is the main issue. On #3 and #4, I totally agree, plus, the good apps are hard to find! A better way to find applications is needed. On #5, I totally agree as well; the wrong expectations were initially set.

Alex followed writing that developers should be focusing on the platforms that are most “useful” to as many people as possible in the world… these being J2ME, Web and S60.

But useful is *very* relative. For talking on the phone? For writing applications? For deploying and making money from? I used to think as Alex… yes, it all sounds reasonable — target the platforms that (in theory) have the largest subscriber reach. Well, that is, until you take into consideration “Show me the money”, as Ajit likes to say.

From the “show me the money” perspective “rich development platforms and ecosystems” have proven, finally, successful. When I say “rich development platforms and ecosystems”, ecosystems go beyond app repositories, and it is about all the details that make it work, which includes user experience, integrated billing/payment, social and not, feedback system, and all the goodies a good/properly designed app store is all about.

I remember the debates between Ajit and myself over Web vs. local apps a couple of years ago, including at JavaOne Motorola Keynote, where I defended local applications while Ajit debated that “AJAX will replace both J2ME and XHTML as the preferred platform for mobile applications development” (note that he wrote J2ME but he really meant local apps). Today I can humbly say that I was right about local apps, and that “AJAX will not replace local apps as the platform of choice for developing mobile applications”. At least not yet. Ajit was/is right that mobile web apps will be huge, but they will in a different way as when it comes to richness and user experience and making money, today it is about a local apps.

And it took Apple to show “us” the way.

App Stores have proven central for developers (i.e. “show me the money”), and for subscribers (to easily find and download apps). And as a consequence, have proven beneficial to network providers themselves – gosh, it has taken so many years for network operators to finally open their eyes, not be so paranoid and over-controlling, and agree with common sense — it is an ecosystem after all. So now, all are converging into similar solutions such as iPhone’s App Store. They have to – the power is shifting to the subscriber itself, and to the developers who are bringing applications, software to the market. And those platforms that don’t play nice with the ecosystem, will fail.

So the argument that subscribers would not download local apps, argument a number of us didn’t agree with and defended against over the years via our blogs and apps, resulted in a non-issue. Yes, users will download rich, useful applications, and even better, will pay for them if given ways to easily find, pay for, and download those applications. While other types of apps such as Web and SMS, well, subscribers do like, but for free! Don’t you agree? What this translates to is into business models centered on the subscriber vs. “the other side of the subscriber” such as businesses, etc.

A word on the various platform

A word on iPhone: the device, the platforms rocks. I have an Android (personal) and an iPhone (work). And the iPhone is a beautifully designed piece, overall, from hardware to software. AT&T will hurt and cry if/when iPhone goes to other operators. As a sidenote, see ReadWriteWeb article by Sarah Perez titled The State of the Smartphone: iPhone is Way, Way Ahead, where she explores a recent report by Flurry that concludes that the iPhone is way ahead when it comes to mobile apps (based on the number of developers, apps and consumers). But, let’s take this report “with a grain of salt”. Why? Because it can be biased as follows: the majority of the developers using their analytics instrumentation code might just be iPhone developers, thus, the sample-set is biased by default.

A word on Android: just give it time. Android has the potential to be everywhere – phones, internet appliances, cars, etc. around the Globe, and thus many different types of developers (mobile to embedded). And it very well might allow developers to enter “emerging” markets easier. Judging Android after 6 months or so means nothing in the grand scheme of things. Time will tell (but I stand by what I’ve been saying thought).

A word on BlackBerry. They are getting it, but imposing a minimum app price of $2.99 — because “they value the efforts of developers” is bogus and is an attempt to sound developer-friendly. Let the market decide pricing!

A word on Nokia: they are trying with Ovi, but keep it simple! I really hope Nokia hits the ball out of the park –but they should consider simplifying their portfolio tho, see On Nokia’s App Store Strategy. Nokia’s attempt to do integrated billing for their App Store and (eventually) requiring Credit Cards mean they are thinking the right way.

A word on J2ME: Java ME suffered over the years due to 1) the process that created it was too slow to adapt, allowing for inconsistent implementations and incomplete API-sets, 2) its security model, and 3) lack of integrated app repository (i.e. app store). I still believe it has potential to be the platform of choice for mid-level phones. Specially with the latest MSA API-stacks and MIDP3 that (I hope) will come out later this year. And today,if you have the right market and channels, go for it.

A word on Web: best channel for apps that easily bring “generic” content out to people. Huge potential, especially with efforts such as BONDI and HTML 5 persistent data and the Canvas elements. In any case it is always a good idea, if it is applicable, to have a mobile web version of your app.

A word on short messaging (regardless of SMS or Twits): best channel for notification-like distribution. Second to none. True SMS is way to expensive and prohibitive for many; SMS though is a cash-cow for network providers who must be terrified of Twitter. If targeting notification-like app such as promotions SMS and Twitter is the way to go.

A word on voice apps: I wish we spend more time investing/researching this mode of interaction.

A word on SIM-based apps: The SIM card will always be at the center of mobile apps – directly or indirectly. New technologies such as JavaCard 3.0 and Smartcard Web Servers (SCWS) have the potential of bringing a new breed of mobile applications. Still developing SIM-card based applications is a niche and very network provider oriented, but if you have the relationship w/ the carrier, go for it!

And what the best type of application is? The hybrid app! This is a rich *local* app that is very good at consuming and rendering web content, as well as direct messages (i.e. SMS, Tweets). In the future, mobile web has tremendous potential but again, it is about making money *today*.

So in conclusion, we have to agree that today, integrated app stores that caters subscribers directly is the best channel for subscribers, and developers, and for operators as well. The potential for reaching more subscribers via J2ME, S60, and Web do exist, but but one thing is to create and attempt to deploy apps for those platforms, and the other is those apps getting payed for, downloaded and used.

As a recent report by IDC (Scott Ellison) titled “Developer Strategies for Success Shift as Apple iPhone Apps Store Passes 1 Billion Downloads” concluded:

Apple has demonstrated — again and again — that the success factors in mobile can change in the blink
of an eye — indeed in as little as 3 quarters in the case of the Apps store. The Apps store is increasingly
central not only to Apple, but to any developer or company seeking to play in the mobile applications and
content space. And understanding the shifting success factors within the Apps store is key to success
both on the device and in the digital marketplace that continues to remake mobile.

ceo

P.S. Anders Borg (Abiro Mobile News) has written an excellent analysis of this blog piece — see The state and future of mobile applications. And I like very much Michael Yuan‘s comment saying “What developers want is to address the “maximum number of people who are willing to pay”; exactly!

Tagged on:                                         

7 thoughts on “On Mobile Applications, Platforms and Monetization — “Show me the Money”

  • April 30, 2009 at 6:00 pm
    Permalink

    I think the notion that you need to go after the “maximum addressable market” is deeply flawed. That is what had hunted J2ME developers for years — to accommodate low end Java phones as required by carrier’s on-deck app stores. What developers want is to address the “maximum number of people who are willing to pay”. Today, it means the US iPhone market.

    Also an interesting article about Papa John’s “failed iPhone experiment”. It demonstrate web versus native, and big addressable market (web) versus niche (iPhone) at the same time:

    http://www.readwriteweb.com/archives/papa_johns_says_iphone_app_is_a_dud_maybe_they_should_launch_real_one.php

  • April 30, 2009 at 10:54 pm
    Permalink

    As a member of the JCP expert group for JSR271 (MIDP3) : don’t you have some information on the current schedule for MIDP 3 ? How can you only hope MIDP 3 will come out this year?
    From an external point of view, jsr 271 expert group hasn’t given any sign of existence since march 2008 and it should have been released a long time ago… If MSA is cool, I believe MIDP3 is needed for the Java ME subsistence!

  • May 1, 2009 at 3:19 am
    Permalink

    “AJAX will replace both J2ME and XHTML as the preferred platform for mobile applications development”

    Urgh, never understood this quote and it always annoys me that it’s *still* so widely referenced as valid analysis. Leaving the J2ME aspect aside it makes no technical sense what-so-ever to say that Ajax will replace XHTML! That’s like saying butter will replace bread.

  • May 1, 2009 at 7:37 am
    Permalink

    @Jerome –

    MIDP3 should be out this year; (slow) progress have been happening in the background. MIDP3 is has many new parts. The process is slow. I say “hope” because there are so many things that can affect its public release and adoption (such as Oracle acquisition) — yet to be seen is which vendor is implementing it, but all vendors that has supported J2ME should be adopting it… The spec lead recently left Motorola. I’ve no idea what will happen if Motorola (who is the spec lead for MIDP) decides to drop J2ME support — remember, Motorola committed to Android.

  • May 1, 2009 at 10:25 am
    Permalink

    ceo,

    thanks for summarizing this Forox thread. It’s been a real good one, and has been covering so much ground too. It’s real good to see it all coming together here. Now I can delete those emails. ;-)

  • May 2, 2009 at 12:10 am
    Permalink

    Thanks a lot for this answer

  • Pingback: McGuire’s Law » Blog Archive » Observations: Applications - May 5, 2009

Comments are closed.