Networks shouldn't let handset companies run away with the app store market.
The app store phenomenon has clearly demonstrated that customers will pay for additional services given the right mobile experience.
But, for the moment, it’s the handset manufacturers that are dominating this space. One billion Apple App Store downloads tells its own story, with Palm’s Software Store, RIM’s App World, Nokia’s Ovi, and Google’s Android now well-established too.
A recent report by Nielsen (June 2009) found that 75 per cent of iPhone users download apps compared to 15 per cent of all mobile users.
To put a positive spin on this, there is certainly room for service providers to capture new revenue streams for themselves – especially given the competitive advantage they have on these storefronts.
What advantages? Well, network assets and business support systems for a start. By opening them up to the developer community, they can create an ecosystem that supports the creation of compelling apps.
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For example, small developers don’t have the time, money or ability to invest in sophisticated billing capabilities. But they can integrate with a service provider’s payment infrastructure for instant access to millions of subscriber accounts.
Conversely, service providers can sell developers’ products to their customers using multiple established distribution channels, such as web portals, on-deck mobile portals, and digital TV.
Another invaluable benefit to developers is the ability to authenticate a particular user against the subscriber’s database. For example, the ability to check a user’s parental control settings before granting access to certain content.
But that’s not all. There’s also the chance to embed voice, presence and other capabilities into apps to make them more functional and personalised for consumers.
Of course, it’s not straightforward to build a winning app store. It hinges on a consistent developer experience.
On the business side, the platform must provide:
• A simple onboarding and submission process, including published, transparent guidelines
• An incentivised community that provides feedback and testing assistance
• Robust monetisation engines, including marketing features like user ranking and personalisation built into the storefront
• A simple and attractive revenue share model, including incentives to moderate data consumption and support costs
• Marketing support
From a technology standpoint, it must:
• Expose network services (e.g. location, contacts, call management) that can differentiate applications
• Provide powerful yet easy to use development tools
• Make it easy for developers to find, implement and test the APIs (application programming interface )they need
• Simplify support for multiple platforms
• Enforce policies without compromising the developer experience
• Address privacy, access control and network abuse
Done right, an app platform can launch mass market as well as niche applications to a wide audience. This enables service providers to cover both the “short head and the long tail” of the market, addressing each customer’s unique needs and maximising overall revenue potential.
Rebecca Prudhomme is Director of Product & Solutions Marketing at Amdocs Interactive
