Rethinking Apps: Why Nokia, Microsoft, Google, RIM, and HP Should Partner Together

Apps. They’re beautifully created, thoughtfully purposed programs that help us extend the value of our smartphones by tapping into a whole universe beyond the basic silicon, glass, plastics, and other materials that are part of the physical phones. And Apple’s clever marketing campaign has led us to believe that there should be an app for everything–from the games that we love to the photo sharing site that we frequent, to the social networks that pervade our own digital existence. It’s now been three years since the first native app appeared on the iPhone, and developers have gone a long way, utilizing different methods to monetize their apps, different social and cloud services to connect their audiences with, and different hardware APIs and SDKs to tap into to leverage the full potential of the smartphone. However, now, with apps beginning to mature and rival platforms demonstrating their hardware prowess, is the time, I posit, to re-think apps and give web apps a second chance. Doing so could potentially disrupt the app ecosystem that Apple has been successful in defining.

History of Web Apps

Apple had initially launched the iPhone without native apps support in 2007. When the aluminum-clad smartphone marvel that was popularly referred to as the “Jesus phone” by bloggers came into existence, Apple restricted the iPhone to web apps, though the company quickly realized the follies of its way and opened up the iPhone OS to native apps in 2008.\

Web apps, at the time when the initial iPhone launched, was an immature offering and resulted in just pre-packaged web pages. Many of those pages were static and not as interactive, though a number of very casual games did emerge. In fact, quite a few of the initial web apps for the iPhone harken back to the days of wap webpages, or specially formatted websites that consume less data and were more primitive for the early days of mobile Internet on feature phones.

The Emerging Apps Ecosystem and Apple’s Dominance

Apple didn’t invent apps, nor did the company debut the very first app store. In fact, there have been various third-party app stores for various platforms from Windows Mobile to Symbian to Palm OS prior to the debut of the iPhone. Apple had skillfully and masterfully leveraged consumer hype behind its brand, aggressive developer revenue sharing to attract app-makers, and the ease and simplicity of the app store process to attract consumers to make the App Store a success. In the early days of third-party app stores, developers often paid 40-50% of their revenues to the hosting app store–Apple made the split more equitable by only taking 30% in exchange for hosting the app, and in some ways marketing the app through its app store. Additionally, it gave developers the right tools, a good design philosophy to make apps appear unified in appearance with guidelines for chrome, buttons, and other elements, and the company got consumers interested. In the old days, consumers who purchased a game had to remember a username, password, serial number, or some sort of piracy protection mechanism to ensure that the app was legitimately purchased. With the app store, Apple utilized iTunes’s DRM mechanism, eliminating complicated serial numbers and logins.

Native apps also offered benefits to consumers. There were more complex games and more powerful programs as Apple gave developers a way to tap into the iPhone’s hardware through the SDK. Developers can now exploit the mobile broadband radio to build Internet-connected apps, accelerometer and gyroscopes, Bluetooth and WiFi modules, and other hardware elements. All this momentum helped the iPhone and iPod Touch to be among the best gaming devices for casual gamers.

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The Problem with Apps

Apps are great, on the iPhone that is. The problem with apps is that developers who have stuck to the proven iOS platform are sometimes reluctant to give other platforms a try. The Nokia Store (formerly Ovi Store) has seen only a limited number of decent apps for its S60 and Symbian^3 ecosystems despite Symbian still being the leading smartphone platform worldwide. Google’s Android OS, which is now eclipsing the iOS platform, is seeing very few high profile titles being ported to the platform.

Also, when consumers buy into an ecosystem, there’s also the cost of switching. Bought Angry Birds for iOS and now want to switch to Android? You’ll have to re-purchase your favorite game and any other apps you’d want to carry over–if they’re even available for the platform you want to switch to.

Why Web Apps Will Matter Now

Despite the fact that there are third-party tools, such as the Unity Engine, which allows developers to develop cross-platform games with minimal efforts, developers still would need to tinker with the codes. With the rise of the cloud and faster mobile broadband connections, the smartphone platforms could be commoditized in favor of creating smarter, better phones delivered through the power and potential of apps. Phones, then, are like networks–conduits to deliver information, whether it be stored locally on the device or remotely in some sort of cloud.

Just like what we’re beginning to see on the desktop–the migration away from computers to the cloud–smartphone and tablet app developers who leverage HTML5 to create web apps could use the shift to their advantage. This way, rather than coding to specific audiences, developers can code for the Internet and once HTML5 standards get finalized, they can be sure that their apps will work on most, if not all, HTML5-complient browsers, saving time and money.

Additionally, by moving to the cloud, developers can also begin to initiate a power shift away from the platform to themselves. Rather than let Apple dictate the rules, like with the iOS App Store, developers now have free reign to reach their audiences in a more democratic environment where anyone who has access the net can have access to their work, regardless of any App Store policies.

HTML5 Providing Power to Give Web Apps a Fighting Chance

Given that browsers on many modern operating systems and platforms now are coming with robust HTML5 support, the potential for web apps to succeed is enormous unlike a few years ago when the first iPhone launched. With HTML5 apps, the playing field would get leveled and iOS may not be able to remain as closed as it used to. Heck, even Playboy, which couldn’t get its magazines into the iOS App Store due to restrictions regarding the appropriateness of the magazine’s content, is turning to HTML5 to power its magazine.

When platform owners such as HP, Google, Microsoft, RIM, and leading manufacturers like Samsung, HTC, Motorola, LG, and Nokia start to turn to HTML5, the combined user base of all these platforms will eclipse iOS and provide a huge incentive for developers to develop for open, rather than closed standards.

Whereas platform and computing power drove the growth of the PDA industry–those who remember Palm will know that the company tried to remain pure to the core PDA functions while Microsoft with the Pocket PC tried to incorporate the power of everything into its miniaturized ‘PC’–apps will be driving the growth of the smartphone era by tapping into services, ecosystems, platforms, networks, and power that are not found on a stand-alone platform. For instance, the iPhone, which can tap into Netflix’s ecosystem for streaming videos, visit Pandora’s service for streaming music, access Google Docs for cloud-based collaboration that traditional Office-style apps cannot provide, and leverage the power of AT&T’s or Verizon’s network to do most of its cloud-centric, network-connected work. However, by democratizing these powers and eliminating any exclusive app arrangement with any single platform, we run into a challenge with apps–it’s too easy to switch.

The cost of democracy: Switchers

If the coalition of platforms begin to promote web apps over native apps, the problem is that by creating a democracy, it’s too easy to switch. Android users can readily switch to Windows Phone 7 and iOS users can switch to BlackBerry devices as the barrier to switching–the cost of having to re-purchase apps–is now removed. This is the other side to the double-edged sword. However, I still find that this is the best way to fight iOS’s dominance. Rather than competing with Apple head-on with apps, and the sheer scale and size of the iOS App Store, rivals should band together. After all, a switch between Android, webOS, Windows Phone 7, BlackBerry, and even Bada would be seen as favorable than a user from any of those camps switching to iOS.

In order to do that, makers would need to define and execute on their platform strengths, which is something that we haven’t really seen. So far, we’ve seen iPad competitors boast iPad-killing features, but then products launch without any of those features, negating the need for a true iPad rival in the market place. Take for instance the Motorola Xoom, which boasted 4G LTE, Android Honeycomb, and Adobe Flash as potentially better enhancements than what Apple offered. Yet, at the time of the Xoom’s launch there is no 4G LTE, there were no Honeycomb apps and what was in Android Market was few and scarce, and Flash support came via a later software update that made the launch appear muted. On the BlackBerry PlayBook, there were no core PIM apps, and Flash was a disaster that crashed when streaming long videos despite a stellar display and great build quality. And now, the TouchPad is launching with negative press that seems to compare the device against the original iPad and not the latest one, despite having launched moths after the iPad 2.

If manufacturers bulked up and delivered experiences–versus products with good specs–they may stand a chance to compete with iOS. And with experiences, apps begin to matter less–though they’ll still be important. And rather than try to compete against the hundreds of thousands of apps in the App Store with individual platform-specific app stores, these platform owners can reward developers who create HTML5 apps as a way to pool together all their individual app stores into one to compete on scale.

Building Value by Selling Services, Rather Than Products

The challenge faced by app-makers right now is piracy, which can occur on any platform. But that’s part of the natural process of creating a product–a packaged game, program, utility, or tool. Rather than selling a ‘product,’ where the game or program itself is an app, developers can help to curb piracy by shifting the paradigm to selling a service. This way, instead of selling the app as a product, the app can be given away for free. However, for the app to be useful, it needs to connect to the Internet, tap into the cloud, and get its content from there.

We’ve seen this implemented in a number of services right now. For instance, while the Netflix app itself is a free download, to get any value out of the app a user would have to be a Netflix subscriber to get the streaming movies. We’ve seen free games emerge as a result of the popularity of the iOS and Android platforms, and those games can either be monetized through ads or via the purchase of additional levels, tools, or other game merchandise to enhance the level of game play or a user’s status within that community–and all that can be facilitated with in-app purchases.

Developers who turn to the web with HTML5 apps can leverage the ‘experience’ of their services, rather than selling the app itself as a final product, and can do this freely without having to go through an established app store to set up in app purchases. If developers can keep the experience easy and simple, deliver value, and make their offerings worthwhile, they’ll be able to attract customers by finding new ways to monetize their work.

Angry Birds on Chrome

Chrome is paving the way for more cloud-based and web apps, and Angry Birds and a number of other apps on the Chrome platform is slowly showing the world that going wireless is truly feasible. However, with a laptop, that’s still a challenge as mobility and connectivity may always be an issue until the world’s blanketed by mostly free WiFi hotspots. With smartphones–many of which already come with a data plan required by a carrier, especially in the U.S.–it seems that this would be the logical place to start experimenting with web apps–you have a large enough audience, the Internet connectivity needed, and big enough brands to catapult web apps mainstream now that consumers can know what to expect. With the rise of 4G and even faster data connections, the potential is there is all the iOS rivals learn not to compete against each other in favor of the larger threat–iOS. In order to that, taking a risk on web apps may be a good strategy as it allows them to attract more developers, build a larger combined app catalog, and help to drive the growth of HTML5.

 

Comments

  1. Dale Strauss says

    Well reasoned report but for one fundamental flaw – AT&T and Verizon are irrevocably choking the internet with excessive metering and predatory pricing. There is no future in stremaing media, online games and “web apps” when access to the internet is so costly and/or constantly capped. AT&T has evne gone to metered broadband – so much for Netflix, Hulu, etc., as well as any full time reliance on Google Apps or Office 365. As long as teh pipes are so rigidly constrained adn priced, there will be no real move to “the cloud” outside of large corporation data backup schemes.

    You cannot afford to rely on the internet so much at $25 for 2gb per month…I marvel at how logical thinking people scream for “regulation” because of gasoline prices, but just look teh other way as the carriers and major ISP’s choke the future of our economy.

    • Daniel Risi says

      True that mobile internet prices are ludicrous everywhere. But even if they are not going down fast enough to foment a web app rush, they are not raising either. I see mobile internet usage growing at encouraging rates in the so-called high growth economies. This fact tells me that, even with an over-priced access bottleneck, mobile web services should flourish soon due to one single reason: demand.

  2. Zane Farooq says

    It does not need to be regulated price wise..any attempts at doing that will simply lead to it getting more expensive. 

    The carriers need time to upgrade their networks, wait till 4G LTE is in full motion…give them time to upgrade their networks. Then you will see the difference. 

    • Dale Strauss says

      I seem to remember that same argument when Apple released the first iPhone – that the carriers just needed the time to upgrade their networks to 3g, then all would be better. Since then I’ve gone from $30/month unlimited to $25 per month 2gb, with Ralph’s hand gladly stuck deep in my pocket.

      I am not advocating price regulation, but if anyone thinks that continued carrier consolidation and waiting for AT&T’s or Verizon’s benevolence will lead to enough reasonably priced bandwidth to usher in this great new iCloud/SAS future, I know where they can buy a bridge in Arizona…

  3. Willem Evenhuis says

    Nice Article. Food for thought on a tricky subject in my opinion.
    I think the reason webapps will take off is because it gives a sense of continous connectivity, whenever and wherever. I shouldn’t matter which platform you run on because the app is launched from the web. All you need is a webbrowser. This is perhaps the achilles heal of the app. A valid argument is the fact how well the connectivity is and will remain provided by the current carriers. I can’t speak for the US, but for the Netherlands and Europe, there is still a lot to be desired in terms of connectivity and 3G. This would then be the achilles heel of the webapp, thus a big advantage to the presinstalled app.
    I personally would like to see the comibining of both worlds, have the advantage of offline use and productivity with the benefit of more productive functionality of the webconnection when connection is good. Comptetion is good between OS’es, but I can not help the impression that app functionality is fragmented due to the fact of blocked functionality due to scare tactics of patent infringement lawsuits. I get the argument to honour investment and maker(s),  but I would then argue to discuss colaboration and mutual product improvement or implemetation, rather than evoking a defensive reaction and slowing progress.

  4. Anonymous says

    Some apps would do fine as web apps, but the performance would not be competitive for demanding applications. Of course, that’s the reason phones that can run Flash apps aren’t iPhone killers. It gets you part of the way there, but not quite enough. As phones get more powerful, Flash apps will start to have an impact. A little more time and HTML 5 will have an impact.

    So I would agree with the author in the long term, maybe in 2-3 years, but for now I think you have to develop native apps to be competitive. And in that case, standardization of the hardware and operating system are going to be big advantages to iOS. Again, I think this will change with time. Android phones and tablets will likely begin to standardize more as the market matures.

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