Neutron :: Bomb

by John Calian |
Topics: Application Stores | Smartphone Marketplace

I have been reading a lot of stories about App Stores, and there is a prevalent theory among consultants and experts that 'more choice' in App Stores is going to confuse consumers. Really? Keep in mind that there are currently no smartphones with multiple stores, and there will not be in the near future.

The argument goes like this: a consumer buys a Nokia phone from a carrier. Once the phone is in the hands of the consumer, they go to the device homepage, and 'may' be presented with one or more 'stores' on the homepage, ie icons to click on. And if there are two icons to choose from, what choice does the consumer make? The Nokia branded store (Ovi), or the carrier branded store? Or maybe there is even a third choice, the operating system branded store? Well, not in this use case, but you could see this if you are use an HTC smartphone, running Windows Mobile, on TMobile, for instance.

So, what is the consumer to do?

The fact is this: each of the stores is going to offer applications that work ON THE DEVICE, so a consumer WONT get an application that doesn't work. And each of the stores will offer some method to pay for the applications, such as carrier billing (the price of the application is put onto your carrier bill) or some other form, like Paypal or Google Checkout, or maybe even CREDIT CARD billing.

I suppose if you cant remember where you shop, you might be confused. But I think you have bigger things to worry about in that case.

Consumers currently have 'choice' about where to buy a piece of software for their PC or Mac; in fact there are thousands of stores that sell Quicken, for instance. Once you own quicken you can easily install it on your PC or Mac and should not be confused. Just like buying a smartphone application from one of the stores on your new smartphone.

I do not see that consumers will be confused. Rather, I see carriers being confused right now on which strategy to take: keep 3rd party app stores walled out and run their own; run their own and have 3rd party; just have 3rd party app stores

The current landscape includes Apple and iTunes as the App Store leader, and it services one device. RIM has its Blackberry Store, which in theory works on most Blackberry devices, Google has the Android marketplace, Microsoft is launching its store, Nokia has Ovi (a store with a history), HTC and Samsung are making noise (horrible website design), Vodaphone announced a HUGE effort, Palm has an App Market, and we are simply waiting on others to join.

But, most smartphone users WONT have choice... A single smartphone is most likely tied to one store. There is no example right now of a smartphone device with a choice of stores. There may be in the future, however. Lets hope consumers can handle it properly.

So, whats the big deal? IMHO, the big deal is WHO is going to own this? And the answer is not simple, and it wont be one company. Apple only serves Apple devices; same with Google and MSN. It is the strategy of the Carriers that will be interesting, to gauge how 'open' they are willing to become, and how much closer to dumb pipes they are willing to let themselves become.