Part of my daily routine, beyond working on consulting projects, creating (kick butt ;-) ) research reports and speaking to people within the world of enterprise mobility, includes a bit of web surfing to learn about what else is going on in the world...to see what, if anything, can be learned from other parts of society - whether business related or not.
Earlier this week, I stumbled upon a wonderfully interesting article at Fortune Magazine on the iPhone App Store's forthcoming first birthday (sometime this week). I found it fascinating because it's as much about business as it is about society today.
So as I mentioned above, Apple revolutionized the world of mobility when it announced its App Store that allows people to purchase and/or download for free applications for their iPod Touch or iPhone, either when mobile or via iTunes. 50,000 applications and over 1 BILLION downloads later, no one can deny the success Apple has had, nor the watershed event it was. We now have "Me Too" services from all the major platforms: Android, BlackBerry, Palm, Microsoft and Nokia. Let's not forget however, the original pioneer Handango.
My question is though, who wins from this advent? Certainly consumers win as their devices are now able to have tools and functionality that they could not have imagined before. For me personally, I find the convenience of being able to read the New York Times or BBC World News or The Washington Post to be a wonderful resource on my mobile. While I am not a gamer, I also recognize how attractive that can be for people...as well as tools such as FaceBook. While whimsical applications are attractive to some people, I still wonder how society functioned without applications such as iFart.
In all seriousness though, the Fortune article does raise the whole point of commercial value. So many applications that are actually for sale on the Apple App Store are sold for $0.99 - even if you see hundred of thousands of copies, it's hard to justify the investment that was made to create the application....especially when you take Apple's 30% cut out of the equation. When you get to more "serious" applications, such as QuickOffice, then you're talking about $12.99 for the download. I suspect far fewer people will be buying applications for that price. And here comes a great quote from the article:
"That stands in contrast to the more mature list of PC software bestsellers at Amazon.com, where serious titles like Microsoft Office, QuickBooks Pro and Photoshop Elements sell for closer to $100."
And that right there is the rub in my opinion. I think App Stores, while great for consumers, ONLY serve the platform vendors. It helps drive handset sales and the platform vendors I suspect are OK if they just break even with their App Stores. Remember, when the iTunes store started selling songs, the original intent was for it to simply help drive iPod sales. Now sure, that venture is making money hand over fist now (I suspect), but it pales in comparison to how much money Apple makes from iPod sales that connect to it.
Then, we need to talk about the enterprise angle (you knew it was coming). App Stores are just bad for the IT department. I've said it before and I'll say it again. App Stores are just bad for the IT department. App Stores, while great for consumers, create complete havoc for IT departments who want to manage their devices (and frankly, ALL IT departments should want to manage the devices that tap into their back end systems....even email).
Now, that said, I'm also a realist. App Stores are here to stay (at least for the foreseeable future). IT departments are going to have to adapt to them. That means they need to have their own enterprise grade app stores (think Mobile Application Management), as well as the ability to allow or forbid people to download applications in the first place (think Mobile Device Management). The platform manufacturers need therefore to work with enterprise mobility vendors to create solutions that can marry the two concepts together....allow application white lists for consumers and ensure black list enforcement for the IT department. That, in my opinion will create the right balance for accelerated personal and professional adoption of smartphones and app stores.
UPDATE: I also found this article that I thought was highly relevant to the conversation
