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LAS VEGAS – Welcome to App World.
Officially, that’s the name of Research In Motion’s new wireless store for software applications – or apps – for the company’s popular BlackBerry phones.
But the name also describes the changing face of the world. BlackBerry App World opened Wednesday with fanfare at The WirelessAssociation expo CTIA, held in Las Vegas each year. Nokia plans to launch its app store, Ovi, next month. Palm has a similar store planned to accompany its new Pre phone. And Microsoft plans its Marketplace for Mobile sometime this year.
Those are just the newcomers. Google opened its Android Market four months ago to support the first Android phone, the G1 from T-Mobile. The original, Apple’s App Store, opened in July.
Phone manufacturers have scrambled to catch up to the iPhone’s hardware – its good looks and slick touch interface. Now they face the challenge of trying to match the software offerings and popularity of the App Store or risk losing customers. Companies with the best apps could be the survivors of a possible smart-phone shakeout, industry analysts say.
iPhone owners have embraced the download of apps that provide remote access to Facebook pages, links to Internet music service Pandora or to Shazam, which will reveal the name of songs playing on the radio or piped into the elevator, in numbers the industry had never seen. That raised awareness and expectations that a smart phone could do more than manage personal finances or convert currencies.
“We have very loyal customers,” said RIM Public Relations Director Shelly Sofer. “Carriers value the low churn (turnover) among BlackBerry owners.
We want to make sure there’s no reason for anyone to leave.”
Selling apps is not new. Nokia, RIM, Palm and Microsoft supported the little mobile programs long before Apple got into the business. But in the past, the programs were scattered around the Web and sometimes available directly from carriers.
Shazam, for example, has been around since 2002 but didn’t become a phenomenon until it was embraced by the iPhone nation.
Apple changed the game by persuading AT&T to let it create a one-stop shop for iPhone software. Based on its successful iTunes music and video model, Apple’s App Store allowed developers to create and market apps to millions of iPhone users.
“We’ve always been a platform for services, but our applications have been all over the place,” Sofer said. “What Apple did was open the barn door. It created an opportunity with the carriers for RIM and others to open similar stores.”
Apple enjoys a level of customer loyalty often compared to cult membership. No one expects any competing services to push Apple off the top of the app hill quickly.
Since July, the App Store has provided more than 800 million downloads from more than 25,000 free and paid apps. In comparison, Google’s Android Market offers 2,300 apps, and RIM promises 1,000 by today. The emerging app stores are often described as contenders to be No. 2 to Apple, though one market research firm expects Android phone sales to surpass the iPhone by 2012, based significantly on expected gains in Android apps.
For smart-phone owners, the app wars provide good news. Companies will be tripping over each other to provide and promote downloadable programs that entertain, add efficiency and put new levels of gee-whiz in mobile phones.
But for the businesses, is shaping up as the next battlefront as companies fight for “mind share” of the developers. With the addition in recent years of smart phones running on operating systems from Apple, Google and soon a new system from Palm, there is growing expectation that the industry will see a shakeout and less successful companies will exit. In his CTIA keynote, Verizon Communications Chief Executive Ivan Seidenberg predicted that the current lineup will shrink.
Developers say it’s expensive and time-consuming to write a program for one platform and then make it work in the others. John Criswick, president and CEO of Canadian game company Magmic, said his company typically writes games first for the iPhone because the App Store is the biggest marketplace. His developers then “port” the game to work on Windows Mobile, BlackBerrys and Android. His company’s games are not rewritten to run on Nokia phones, he said.
Companies are trying to build “ecosystems” around their phones that ensure they’re still around if a game of musical chairs breaks out, and they need developers for that, said Broadpoint AmTech analyst Mark McKechnie.
“It’s like the early days of the personal computer when the IBM PC-compatible platform won over Apple because it was easier to develop software for,” McKechnie said. “It’s a big land grab.”
British market research firm Informa Telecoms & Media expects the app world dynamics to reshape the smart-phone industry. Nokia has been losing market share but will remain the world leader because of its decision to make its Symbian operating system “open source,” meaning that the underlying code is openly distributed and can be used without paying a licensing fee.
Google’s open-source operating system, Android, is also expected to prosper and drive the Google phone to higher sales than Apple by 2012, Informa analyst Gavin Byrne wrote in a March report.
George Linardos, Nokia’s vice president for product media, said carriers and developers would prefer a single platform, but the reality is that the smart-phone world is made up of heavyweight companies with large numbers of loyal customers
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