Is this a case of YAAS (Yet Another App Store)??

Amazon is preparing an Android Appstore. So should we roll our eyes and say “yeah yeah, one more…whatever…thanks…” ??

Absolutely NOT. There are several good reasons why this is potentially the biggest news regarding Android app sales to date.

Firstly, it must be noted, that gross Android app sales clearly lag behind iPhone app sales, despite the fact that the increasing number of Android handsets and apps on the market has levelled the playing field for 2011. It just seems that few developers are really making much cash on the Android Marketplace, for reasons that have been discussed previously such as billing issues, poor design, a proliferation of dodgy apps and a poor ratings system

Amazon will not make those mistakes. They have the clout. They know how to sell, both physical items and digital. They have a powerful recommendations, ratings and rankings system in place for eBooks. And the kicker: they have an established billing system with millions of educated, credit-card-enabled users in place from day ONE.

Sounds familiar? It should. When Apple launched their App Store the reason their paid apps flew out the door could be attributed in no small part ot the fact that they had a huge base of iTunes users already set up for micro-purchases.

Kindle Blazes a Trail

So what kind of user base does Amazon have to tap into for buying Android apps? Amazon can thank it’s Kindle here. There are probably over 5 million Kindle Device users out there of which quite a few would possess an Android device, or will in the near future. And god-knows how many Android users have already installed the Kindle Android app (it is ranked #11 on Android Market)! It took just 3 days back in early July 2010 for the Kindle Android App to go from 50,000 downloads to 250,000+ downloads. By now it would be in the millions and many of them will have set up their credit cards in Amazon’s system to enable the one-touch purchase feature.  I’m one of them – I recently made my first eBook purchase through Kindle Android (for the curious, I bought “In Pursuit of the Gene: From Darwin to DNA” by James Schwartz, for $9.99). I would guess that a Kindle user will find it extraordinarily easy to purchase apps through Amazon’s App Store.

An Appley Approach

Amazon are also taking a more Apple-like approach to determining which apps make it onto their App Store and which ones don’t, without being quite so officious about it. The focus will be on quality (i.e. the app works as stated and doesn’t crash all the time)  rather than sheer quantity and perhaps this is what Android needs? I know I know…Android is all about OPENESS!! But when OPENESS is failing to convert to REVENUE, maybe it doesn’t hurt to emulate the other guy…just a little bit.

Lessons from the eBook Market

Amazon are bringing one fairly unique aspect to their App Store: The developer doesn’t set the price, Amazon does. Some developers will find this idea a bit repellent, espcially the loss of control. But they will need to trust in Amazon’s intrinsic understanding of sales patterns. Amazon already does this price-tweaking magic in the eBooks market and it works. For developers they may make less per sale but should see more sales and greater gross revenues.

What does this mean for Google Marketplace?

Nothing really except that they are about to have some serious competition. Which is a good thing. Google are already making some long-awaited improvements to their Marketplace and hopefully in the longer run Android developers will find they can make serious revenue from BOTH channels.

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Posted by David Kainer on January 6th, 2011 :: Filed under vision and trends
Tags :: 2011, Amazon, Android, apps, Kindle, mobile applications

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We’ve pulled out the crystal ball for 2011 and gone out on a limb. Here’s what our team thinks will happen in mobile in the next 12 months or so, in no particular order. Agree? Disagree? Comment and let us know!

1. Windows Phone 7 will become a growing force in mobile games

   yes, we’re going out on a limb here and backing Microsoft to succeed in mobile…finally. We’ve had a good play with Windows Phone 7 and it’s pretty impressive. To be honest, it makes the Android on my Samsung Galaxy S feel a little clunky, while iOS 4 feels like last year’s pair of jeans – if you have it you probably love it, but it just isn’t that new and cool anymore. The overall penetration of Windows Phone 7 might remain low, but it will probably usher in a new level of portable games experience.

2. Nokia will claw back some market share with Meego and Qt

   Nokia will be quick to tell you that they are still the marketshare leader in smartphones. I guess it all depends on your definition of a “smartphone”. My opinion is that just because it has Symbian in it does not mean it is a smartphone by 2010 standards. Indeed Nokia have been taking a pasting from all sides and have lost great chunks of market share in advanced countries. But we reckon they are about to arrest the slide in 2011. Just like Motorola turned around their dismal handset division in the USA through the launch of Android devices, so too Nokia will turn things around (predominantly in Europe) with new Meego / Qt devices. Qt looks like a a well planned development platform and Ovi is turning out to be a very powerful app store that has defied the early criticisms. With the introduction of Meego and Qt Nokia will start looking like a handset company with a vision, rather than looking like a washed out prize-fighter clinging to the memory of victories long past.

3. RIM and Samsung’s Bada platforms will fail badly

   While Windows Phone 7 and Nokia Qt will pull in developers eager to crack new markets, Samsung’s Bada and RIM’s Blackberry 6 will fall by the wayside. Neither are bad, they just don’t have the cut through in both devices and developer interest compared to iOS, Android and Windows Phone

4. Android will introduce their own in-app billing system

   The lack of a killer billing system (both for downlaods, and in-app payments) has really held back Android revenues when compared to iPhone. Companies such as Zong and Boku launched their own in-app payment libraries for Android in June this year, but these still rely on much of the time on Premium SMS, a system that sees the carriers hoover enormous chunks of your revenue. Recently, however, Google purchased Social Gold, a well established billing and virtual currency platform. Expect an announcement in 2011 regarding an Android virtual currency and billing system that will hopefully revolutionise the way developers make revenue from the Android market.

   Read All »

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Posted by David Kainer on December 6th, 2010 :: Filed under vision and trends
Tags :: 2011, australia, mobile applications, mobile development

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