Posts Tagged ‘developers’
Mobile Apps: China Mobile seeks 50% of revenues from Apps sold at its store
“China Mobile wants at least 50% of the revenues and the rest goes to the developer,” a source from Shanghai Mobile, a China Mobile subsidiary, told TelecomAsia.net.
By contrast, Apple, Android and Microsoft all take just a 30% cut.
The Mobile Market is now being developed by the China Mobile-controlled Aspire Technologies and China Mobile’s Guangdong branch, the source said.
It is likely to go live in September, almost certainly making it the world’s first carrier-operated storefront. UK-based Vodafone has planned to open a store by year-end.
The Mobile Market will allow developers to post apps for all handset OS except the iPhone. It will be accessible from both GSM and TD-SCDMA phones.
Baoding-based Zhu Lianxing, who leads a team named “139.ME” to develop iPhone apps, said the group would submit two Window Mobile apps – one that provides driver’s license practice tests and the Love Forecast, a personal ovulation calendar.
Zhu said the biggest challenge for China Mobile would be to provide a consistent user experience across different phone models and OSes.
“If we develop an app for Apple, it runs on both the iPhone and the iPod touch. Now we have to develop one app for each OS,” he said.
Mobile advertising: Vodafone is taking steps to grow what has been a small part of its business
A new mobile online store is part of Vodafone’s ad strategy. So are location-based advertising and text-messaging ad formats.
Still, the U.K.-based carrier knows wireless firms have talked up advertising for years, and the market hasn’t taken off.
“There’s clearly monetization potential,” Vittorio Colao, Vodafone’s chief executive, said in an interview. “We need to create the conditions for having this monetization really happen.
“Will it be big big for us in the early days? No. But it is important to create the conditions and to make the pie bigger and bigger.”
Rise Of A New Medium
Colao ran Italian media group RCS for two years before rejoining Vodafone in 2008 as CEO. Though wireless firms have had trouble selling ads, some trends work in the industry’s favor, Colao says.
“At the end of the day it’s about the time people dedicate to using a medium,” he said. “It used to be six hours per day of television and one hour per day of newspapers. Now time is moving to new media. There’s a huge amount of time that people spend each day looking at the screen of their mobile device.”
By year-end, Vodafone plans to open an online store where mobile phone users can download games and other software applications, aiming to duplicate the success of Apple . IPhone users have downloaded more than 1 billion applications.
Vodafone would share the application revenue with the software programs’ developers. It plans to keep 30% of sales, the same share as Apple. Many mobile applications are free, however, and the revenue from such a business, even for Apple, likely is modest.
Ads In Apps
Vodafone also hopes to generate dollars from ads that are inserted within some applications. Many advertisers have created branded applications for the iPhone or have placed ads within applications.
“Applications are going to play a role (in advertising),” Colao said. “The creativity of the applications developers will determine the success.”
Vodafone is one of several firms opening their own online stores to sell mobile applications. Others include Nokia (NYSE:NOK – News), Microsoft and Google .
Wireless firms once had a stranglehold on content, steering users seeking applications only to providers approved by the carriers. With the introduction of its iPhone in 2007, Apple had the clout to change that game.
It’s not clear wireless firms can reassert themselves with online stores, says Steven Hartley, an analyst at market research firm Ovum.
“The genie is out of the bottle in the applications game,” he said.
Vodafone, though, has a key asset in its bid to build its applications store. It has software that can pinpoint 20s users’ locations, and it will share that with applications developers. That could lead to more applications that let users find the nearby restaurant, gas station and so on.
Vodafone bought Swedish global positioning firm Wayfinder in December for $30 million in order to boost its location-based ad platform.
Privacy issues have been a hurdle to location-based advertising. Mobile users must “opt-in” to get ads.
Another avenue Vodafone plans to use to drive ads is its “Vodafone Live” data portal, which streams video. Colao says mobile TV will be a revenue generator, though such services so far have lagged forecasts.
Hartley says Vodafone could get a boost as it expands the Vodafone Live platform into more emerging markets.
The wireless carrier, which doesn’t disclose its ad revenue, is experimenting with other models, and it has introduced mobile ads in 18 markets. Vodafone says a new mobile Internet browser it is developing could open up ad opportunities.
‘Please Call Me’
Vodafone plans to expand a text-messaging ad service, called “Please call me,” to more markets this year. Developed by Vodafone’s South African subsidiary, Vodacom, the service lets prepay customers send a free, ad-funded text message to someone asking them to call back. It targets users who are running low on their minutes.
The “Please call me” service already is available in Spain, Egypt, and the Czech Republic. India will be among the next markets to get the service.
Vodafone is testing other ad formats in Ireland, New Zealand, Turkey and other markets. One offers customers points they can redeem for airtime, ring tones and other items if they agree to get ad-supported text messages or other marketing promotions.
USA: Mobile search growing strongly for information on maps, movies, business directories or restaurants
The online research firm’s latest data shows that the number of people who sought local information on a mobile device grew 51 percent from March 2008 to March 2009. The study defines “local content” as “searching for information on maps, movies, business directories or restaurants.”
Furthermore, the mobile browser is the leading access method for seeking local information, with 20.7 million users in March 2009, up 34 percent versus year ago, according to comScore.
However, the strongest growth in the category is coming from downloaded applications, which grew 83 percent versus year ago, followed by SMS at 72 percent, according to comScore.
Yet, despite the attention mobile applications have received from developers, carriers and device makers, they remain the least-popular access mode for mobile access of local information, with 11.3 million users in March.
SMS rates a bit ahead of mobile apps in providing local information with 11.7 million users.
Overwhelmingly, though, the preferred mode to access local content remains the mobile browser.
“Given the explosion in application stores and associated marketing efforts, along with the growth in mobile phones using faster data networks, it would not be surprising within the next six months to see the number of people using downloadable applications surpass SMS for the accessing of local information via mobile devices,” Serge Matta, a senior vice president at comScore, said in a statement.
Among the various local content categories, the number of people accessing online directories has seen the greatest increase during the past year, at 73 percent, followed by restaurants at 70 percent, maps with 63 percent, and movies with 60 percent.
Local search’s increasing role in mobile is prompting local search-focused Internet brands to boost development of mobile content.
AT&T Interactive, for example, recently expanded its YellowPages.com online experience across several mobile platforms.
“We’re focused on extending the YellowPages.com experience to mobile through our downloadable apps, SMS search and mobile Web apps,” Matt Crowley, chief marketing officer of AT&T Interactive, said in a statement. “In addition, we power local search for AT&T’s MEdiaNet portal and have our YP.COM mobile client preinstalled on capable AT&T smart and feature phones. As a result of this strategy, we’ve seen our reach extended by 6 percent for our combined online and mobile unique web visitor audience.”
Local search brands seeking to capitalize on the trend are looking to extend consumer reach and attract ad dollars through both mobile-optimized Web sites and mobile applications. In addition to YellowPages.com, Idearc’s Superpages, R.H. Donnelley’s DexKnows and Yellowbook’s Yellowbook.com have all released iPhone applications within the last six months.
Driving growth in smartphones
News of local mobile search as an emerging trend comes at a time when the growth of the smartphone market is impacting the mobile market on all fronts.
The latest data out today from the Yankee Group says 41 percent of consumers are likely to purchase a smartphone as their next mobile device, with smartphones comprising 38 percent of all handsets by 2013.
As a result of growing smartphone sales, the mobile market is experiencing unprecedented competition. Most recently, the industry has seen signature upgrades of mobile operating systems and releases of the Apple iPhone 3G S and the Palm Pre, while a Storm 2 is expected from RIM, as well as Android handsets from Samsung, HTC, Acer and Motorola.
The success of the smartphone market amid a wider economic slump is also spawning a burgeoning mobile advertising, mobile applications and mobile commerce industry.
Meanwhile, wireless carriers are gunning to fill out their portfolios with exclusive deals for key smartphones while reassessing their relationships with handset makers.
“Traditionally, carriers have had the upper hand when working with device manufacturers to bring a new smartphone to market, but the power dynamics are shifting,” according to the Yankee Group report. “With more competitive entrants, tighter budgets and increased consumer expectations, OEMs and operators need to work together, on equal ground, to thrive.”
Symbian: Evolving toward open
Symbian recently held a dinner with developers and bloggers in Silicon Valley, and I got to see some of those differences in action.
The first difference was the dinner itself. About six months ago, Symbian and Nokia held a conference and blogger dinner in San Francisco (link). It was interesting but pretty standard — a day of presentations, followed by dinner at a large, long table at which Symbian and Nokia employees talked to us about what they’re doing and how excited they are. The emphasis was on them informing us.
The recent dinner was structured very differently. The attendees were mostly developers rather than bloggers, and we were seated at smaller, circular tables that made conversation easier. They talked about their plans at the start, but most of the evening was devoted to asking our opinions, and they had a note-taker at each table. This had the effect of not just collecting feedback from us, but forcing us to notice that they were listening. That’s important to any company, but it is critical to a nonprofit foundation that relies on others to do its OS programming. And it’s essential for a company like Symbian, which has been ignored by most Silicon Valley developers.
So that’s the first lesson about open source. The task of marketing is no longer to convince people how smart you are, it’s to convince people how wonderful you are to work with. Instead of you as a performer and developers as the audience, the situation is flipped — the developers are the center of attention and you’re their most ardent fan.
It’s an interesting contrast to Apple’s relationship with developers, isn’t it? It’ll be fun to see how this evolves over time.
Here are my notes on the subjects Symbian discussed with us, along with some comments from me:
It takes time
Symbian said its goal is to have a lot of developers on the platform and making money, but that can’t be achieved in three months. “In three years time,” is what I wrote in my notes. That is simultaneously very honest and a little scary. It’s honest because a foundation with its limited resources, working through phone companies with 24 month release cycles, simply can’t make anything happen quickly. It’s scary because competitors like Apple and RIM have so much momentum, and can act quickly. Still, in the current overused catchphrase of sports broadcasting, is what it is. An open-source company, based on trust, simply cannot afford to risk that trust by hyping or overpromising.
Speaking of Apple and RIM, Symbian made clear that it considers its adversary to be single-company ecosystems like Apple, RIM, and Microsoft. I didn’t think to ask if Nokia’s Ovi fits in that category, but that probably wouldn’t have been a polite question anyway. Symbian also took some swipes at Google, citing the “lock in” deals they have supposedly made with some operators.
You get the feeling that Symbian is intensely annoyed by Google. It’s one thing for a mobile phone newcomer like Apple to create a successful device; it’s quite another for an Internet company to step into the OS business and take away Motorola as a Symbian licensee. I think one of Symbian’s arguments against Android is going to be that Symbian is more properly and thoroughly open.
The question is whether anyone cares about that. Although the details of open source governance are intensely important to the community of free software advocates, I think that for most developers and handset companies the only “open” that they care about translates as, “open to me making a lot of money without someone else getting in the way.” Thus the success of the Apple Store, even though Apple is one of the most proprietary companies in computing. Symbian’s measure of success with developers will be whether it can help them get rich — and I think the company knows that.
Licensees and devices
One step in helping developers make money is to get more devices with Symbian OS on them. Symbian said phones are coming from Chinese network equipment conglomerates Huawei and ZTE. They also said non- phone devices are in the works.
Licensees will be especially important if Nokia, as rumored, creates a line of phones based on its Maemo Linux platform. Lately some industry people I trust have talked about those phones as a sure thing rather than speculation, and analyst Richard Windsor is predicting big challenges for Symbian as a result:
“It seems that the clock is ticking for Symbian as technological limitations could lead to it being replaced in some high-end devices…. I suspect that the reality is that Symbian is not good enough for some of the functionality Nokia has planned over the medium term leaving Nokia with no choice but to move on.”
Source: Richard Windsor, Industry Specialist, Nomura Securities
David Wood at Symbian responded that people should view Maemo as just Nokia’s insurance in case something goes wrong with Symbian (link). But the point remains that Nokia is Symbian’s main backer today. That is a strength, but also a big vulnerability. If Symbian wants developers to invest in it, I think it needs to demonstrate the ability to attract a more diverse set of strong supporters.
App Store envy
Another way to help developers is to, well, help them directly. Symbian said it’s planning something tentatively called “Symbian Arena,” in which it will select 100 Symbian applications to be featured in the application stores on Symbian phones. Symbian will promote the applications and perform other functions equivalent to a book publisher, including possibly giving the app author an advance on royalties.
The first five applications will be chosen by July, and featured on at least three Symbian smartphones (the Nokia N97, and phones from Samsung and Sony Ericsson).
The most interesting aspect of the program is that Symbian said its goal is to take no cut at all from app revenue for its services. Obviously that means the program can’t scale to thousands of applications — Symbian can’t afford it. They said they’d like to evolve it into a much broader program in which they would provide publishing services for thousands of apps at cost. My guess is they could push the revenue cut down to well under 10% in that case, compared to the 30% Apple takes today.
It isn’t clear to me if Symbian will produce the applications store itself, or work through others, or both. If it works through other stores, those stores might take a revenue cut of their own. But still, from a developer point of view it’s nice to see an OS vendor trying to lower the cost of business for creating apps.
It’s been interesting to see how many of the Palm Pre reviews this week have said that the iPhone application base is the main reason to prefer an iPhone over a Pre. I’m not sure how much purchase influence apps actually have — at Palm, we had ten times the applications of Pocket PC, but they didn’t seem to do anything for our sales. (On the other hand, Palm never had the wisdom and courage to advertise its apps base the way Apple has.)
–”Compared to the iPhone, the real missing pieces are those thousands of applications available on the App Store.” Wired
–”Developer courting still seems like an area where Palm needs work. They’ve got a great OS to work with, but they have yet to really extend a hand to a wide selection of developers or help explain how working in webOS will be beneficial to their business. The platform is nothing without the support of creative and active partners.” Engadget
–”The Pre’s biggest disadvantage is its app store, the App Catalog. At launch, it has only about a dozen apps, compared with over 40,000 for the iPhone, and thousands each for the G1 and the modern BlackBerry models….It is thoughtfully designed, works well and could give the iPhone and BlackBerry strong competition — but only if it fixes its app store and can attract third-party developers.” Walt Mossberg
Anyway, if applications are the new competitive frontier between smart phones, mobile OS vendors should be competing to see who can do the most to improve life for developers. This is another area where Symbian’s motives, as a foundation, differ from a traditional OS company. If you’re trying to make money from an OS, harvesting some revenue from developers make sense. But as a nonprofit foundation, draining the revenue streams from your competitors is one of your best competitive weapons. Symbian has little reason to try to make a profit from developers, and a lot of reasons not to.
Driving Web standards
That idea came up again when we talked about web applications for mobile. As I’ve said before, I think the most valuable thing that could happen for mobile developers would be the creation of a universal runtime layer for mobile web apps — software that would let them write an app once, host it online, and run it unmodified on any mobile OS. No commercial OS companies want to support that because it would commoditize their businesses and drain their revenues. But if Symbian’s primary weapon is to remove revenue from other OS companies, a universal Web runtime might be the best way to do it. I asked them about this, and they said they’re planning to use web standards in the OS “like Pre,” and said they’re interested in supporting universal web runtimes.
I’m intensely interested in seeing how the runtime situation develops. I think Symbian and Google are the only major mobile players with an interest in making it work, and Google so far hasn’t been an effective leader in that space. I think Symbian might be able to pull it off, and become a major player in the rise of the metaplatform. But it’ll take an active effort by them, such as choosing a runtime, building it into every copy Symbian OS, and making it available for other platforms. Passive endorsement of something is not enough to make a difference.
Other tidbits
Symbian said it’s going to “radically simplify” the Symbian Signed app certification program, which may be very welcome news to developers, depending on the details. Many developers today complain bitterly about the cost and inconvenience of the signing program, and unless it’s fixed it’ll outweigh any of the benefits from Symbian Arena.
The QT software layer that Nokia bought as part of its Trolltech acquisition will be built into Symbian OS in the second half of 2010. I had been wondering if it would be an option or a standard part of the OS; apparently it’ll be a standard.
Symbian plans to bring its developer conference to San Francisco in 2010, after which it will rotate to various locations around the world. This is part of an effort to increase Symbian’s visibility in the US market. The company is creating a large office here, including two members of its exec staff. That makes sense for recruiting web developers, but it will be hard for the company to have a big impact in the US unless it gets a licensee who can market effectively here. In that vein, it must have been frustrating for everyone involved when Nokia announced the shipment of the N97 and it came in a distant third in coverage in the US (after the Palm Pre and the iPhone rumors).
What it all means
There are a lot of things that could kill the Symbian experiment:
–Nokia could decommit from the OS (or just waver long enough that developers lose faith).
–Symbian licensees could fail to produce interesting devices that keep pace with Apples, RIMs, and Palms of the world.
–Android could eat up all the attention of open source developers, leaving Symbian to wither technologically.
–The market might evolve faster than a foundation yoked to handset companies can adjust.
But still the Symbian foundation is worth watching. It has a different set of goals than every other mobile OS company out there, goals that potentially can align more closely with the interests of third party developers. It’s still up to Symbian to deliver on that potential, but the company has an opportunity to challenge the mobile market in ways that it couldn’t as a traditional company.
—–
Prof. Joel West of San Jose State was also at the Symbian meeting and posted some interesting comments about it. You can read them here.
Full disclosure: My employer, Rubicon Consulting, did a consulting project for Symbian a year ago. None of the analysis conducted in that project was used in this post. We currently have no ongoing, or planned, business relationship with Symbian. Copyright 2009 Michael Mace.
Mobile applications: Hopes are high for mobile applications to account for a significant piece of wireless revenue
According to a recent survey conducted by Airwide Solutions and mobileSQUARED, operators can and want to have a defined role in the applications ecosystem, enhancing the app experience with unique operator and network assets. But to do that, Airwide offers a set of critical questions carriers must be willing to answer if they are intent on jumping into the apps game. If they are, the door is wide open.
1. How do operators negotiate a revenue share with application developers to make an app store worth it?
Operators should think outside the box when it comes to mobile applications; find a way to layer services on top of third party apps for maximum revenue potential. Developers want viable entry points to subscribers and realize it’s ultimately the pathway to success, but carriers shouldn’t be afraid to break away from traditional service and content delivery models to make the collaboration with developers work.
2. Is the App store model open for debate?
Carriers talk about replicating the app store model, but can that be done when the model is still in its infancy? The reality is there is no set model and no right way to go about it. The market will continue to see the model evolve over the next few months and years, and carriers should focus on enhancing app stores, rather than reengineering them.
3. Should all apps be available to all subscribers or should carriers target apps for enterprise users and apps for consumers differently?
A successful app store will be one that offers innovative applications to users no matter what their device or what their function. App offerings should not be limited to business (i.e. smartphone) users. Carriers must establish a model that offers device agnostic service-enhanced apps.
4. How much is too much?
Carriers shouldn’t underestimate their customer base. While there is a lot of competition among carriers, device manufacturers and developers to hook the subscriber on an initial app sale, all customers want the same thing — ease-of-use, uncomplicated purchasing agreements, and most importantly personalization and customization. Flooding the web/consumers with new app options is only as good as the services delivered with them and that is the differentiator carrier-driven app stores offer.
5. Does it all come down to trust?
Carriers have an incredible advantage in the app store business to leverage the trust and loyalty of subscribers. Recent reports suggest that while Apple’s App Store saw a record number of downloads, most free apps eventually get deleted after the first download. There’s no staying power. Factor into that there is little tying a subscriber to third party apps and there is a very tenuous basis for repeat purchasing. Carriers, on the other hand, with long-term relationships and a trust-factor unlike that on the Web, can bring a new level of engagement between consumers and the apps they purchase. This is good for everyone.