Is selling mobile applications a new business fad?

Selling iPhone apps is becoming a new business fad that people make fun of. It’s adopting a role of clown that an ad based model of free web services has held for a while.

However truth is that App Store is nothing short of success. In January Apple announced that there had been 500 million downloads from App Store. Let’s put this into perspective. There are about 17 million sold iPhones. Apple lumps iPod Touch sales together with other iPod sales, but estimates are that iPod Touch sales total 25 million, which means that there are about 40 million sold iPhone OS devices. Thus on average there are over 12 installed apps per device. That’s an astonishing number. On average on every iPhone and iPod Touch 12 applications have been installed just in 6 months.

How many installed applications a PC has on average?
I haven’t done my homework, but my guess is something between 0 and 1. Your guess?

How many sold games there are per a game console?
My guess: 5. Answer: about 6 over a 2 year period.

Heck, how many bookmarks is saved to browser’s bookmarks on average?
My guess: something between 5 and 50. Heavy users with thousands of bookmarks are likely to skew this a bit in a way that no heavy user of mobile applications can skew App Store stats.

Compared to these, 12 installed applications is a very vivid proof of a working ecosystem. Granted, most of the installed applications are free, but the number proves that App Store has connected application publishers and users like nothing before. And this on a mobile device. Just a year ago, a person who had installed a mobile application was either a geek orĀ  16-year-old gamer with too much time on his hands.

The most successful mobile application store before App Store is probably GetJar.com, that has about 370 million free downloads since 2004. Other successful stores have hit about 100 million downloads each over several years. With a success of App Store, mobile applications market is quickly catching mobile advertising as a business model.

Nokia is rumoured to launch it’s own application store at Mobile World Congress in Barcelona. Currently Nokia has a crappy Download! service on S60 phones and N-Gage market on selected models. If Nokia would unify these and duplicate ease of use of App Store for both publishers and users, it has a huge potential. Nokia sold over 100 million devices last quarter. Think if every new S40 and S60 model would have an application store baked in.

N-Gage Market has a silly restriction that games sold through it should be developed in native C++. On N-Gage Industry Insider a potential game developer is proudly challenged: “Think you’ve got what it takes?”. Pardon me, but who the fuck cares in which programming language a game or an application is developed if it’s fun or useful? Nokia has gone to great lengths to support several development environments on both S40 and S60 platforms: Java ME, Flash Lite, browser technologies with Web Runtime and S60 native C++ development. It should leverage this work. Think how many publishers and users Nokia could connect with a well-made appliation store that allows all these technologies to be used.

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4 Responses to Is selling mobile applications a new business fad?

  1. macoute says:

    So you think that an average PC has about 1 installed software in it? Did I undestand something wrong? I myself am an heavy-user, so not comparable to an average user, but I think almost most of the users have an MSN-client, Office (or alike), maybe some software for their digital cameras, a media player etc etc.

  2. teemu says:

    Yes, you are right that if we count all MS Office installations, the number is likely to be somewhere between 0 and 5. I’m quite confident that there are surprising number of users that install no extra software on PC or laptop, using it just for browsing. I installed Firefox and Google Earth for my mother’s Mac, but that’s about it, they don’t need anything else.

  3. mike says:

    i think that the amount of downloads/sales is more of an indicator to the willingness of the Maciban (those people who have a Fundamental religious belief in the power of Jobs) to buy software.

    At the last Helsinki BarCamp, i was amazed that most of the Mac owners there had been willing to *buy* a CD burning program because it had pretty flame effects above the windows but other than that, no extra functionality than the built in burning software.

    What would be a *really* interesting statistic would be to see the percentage of iPhone users who had never owned another Apple product.

  4. nicholas says:

    Hello,

    There is research from the past that suggests Mac users are more likely to purchase applications. As a designer, I skew the numbers, with fonts and software.

    We are developing an application framework and platform for supporting marketing applications, so the blur between the businesses of application development and advertising is likely to continue. The measure of cost should be changed to value. We believe that marketing apps should provide free embedded content that provides value. We are simply shifting the cost to the marketer. As with the web, we will see different mechanisms for generating value, but I believe that advertising will be accepted when it provides value to the customer, and that applications offer excellent personal interaction possibilities, while social networking allows for awareness or expanding the market.

    The genius of the iPhone/iPod Touch is that the entire application process is very tight. Nokia and Blackberry in particular do not offer the same cohesiveness, nor do they offer the user experience. The costs of supporting applications across divergent platforms is too high as well.

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