The mobile content industry is set to experience tremendous innovation in the development of services, applications, and business models, bringing the mobile Web ever closer to ubiquitous status, according to analysts.
Saverio Romeo, senior industry analyst for mobile and wireless at Frost & Sullivan, says these developments will lead to the establishment of numerous start-ups specifically focused on applications and the mobile Web.
Speaking in a recent Webinar on the topic, he explains the current app store market is a fragmented ecosystem, made up of a network of store providers, developers, and technology service providers. Romeo adds that changes taking place among the various players create both upheaval and opportunity in the mobile industry.
While he forecasts app store revenue of more than $14 billion by end 2014, Romeo says the app stores' influence will not only be in financial terms. “The app stores have prompted innovation and new ideas, not only in mobile, but other sectors too.
“These stores create a direct link between the developer of an idea and the user of an idea and this connection is driving a new kind of business approach,” he says. “Apps have become a medium for social dialogue.”
Romeo adds that app stores are prompting technological innovation. “It's given developers a form of 'braveness', as they can bring apps to the market based on technology that was in labs before.” In this way, applications have become a new channel for experimental services such as augmented reality and 3D browsers, he explains. “Marketing agencies are also using apps and stores as a new way of creating branding.”
Furthermore, banks, unions, and other organisations which have a direct link with consumers are developing apps as a medium to engage with people, Romeo points out.
Tight race
At the end of 2009, there were more than 130 000 apps available on the main app stores, notes Romeo. He adds that Apple offered the largest portfolio, with a community of almost 30 000 developers. “One difference between Apple and the rest is that it has tremendous brand power. With the release of the iPad, for example, you had people queuing in front of stores - that's something that only happens with Apple.”
But while Apple leads the way at the moment, Romeo says this could change. “The Android platform is showing some muscle and is catching up in the US.” He notes the Research In Motion ecosystem is also doing well, not only in the business sphere, as it's traditionally positioned, but in the consumer market as well.
JBB Research CEO, Julien Blin, believes Apple is likely to sustain its lead in the mobile app store market. “They have 140 000 apps available on their mobile app store versus 60 000 for Android and 20 000 for Nokia's Ovi store.”
He adds, however, that Android/Google is set to be Apple's biggest competitor based on the growing support from competing handset vendors like HTC, LG, Samsung, Sony Ericsson, Motorola, Dell, and others. “Android is also an open source mobile operating system (OS), which is a key competitive advantage, as carriers can create their own versions of Android,” Blin explains.
According to Blin, there have been concerns about the emergence of many Android-capable devices running various versions of the popular mobile OS, which has become a real headache for mobile app developers and handset vendors.
“In my opinion, this was inevitable. Instead of addressing the fragmentation issue on the go, Google/Android's goal was to drive innovation, and improve its mobile OS through frequent updates in order to better compete with Apple, Symbian, Palm and others.”
Web as harmoniser
Both the fragmentation issue and career longevity have created uncertainty for app developers, says Romeo. “One big topic of debate is whether the store model is sustainable for developers, as there's strong competition among a large community of developers.”
He explains that as the number of apps in stores grows exponentially, it's critical for developers to raise their visibility. “This means investing in marketing, which brings costs and overheads for developers.”
Another challenge is fragmentation, as developers have to develop apps in different ways in order to compete for a large audience. One solution to the fragmentation of mobile stores is to look to the Web as the locus for open content development and delivery, says Romeo.
“This is the only platform really open for developers; because users can use Web apps developed with HTML5 or other programming languages without any constraints in terms of devices or platforms.”
Blin says he expects to see the emergence of Google Chrome-type mobile browsers capable of pushing Web-based mobile apps. “HTML5, which is set to further gain in popularity in the coming years, could play a key role here and ultimately become the peacemaker between all the standardisation groups,” he adds.
According to Romeo, major industry trends are promoting the idea of the Web as a harmonising environment for mobile. These include initiatives by network operators to provide developers with a common platform for widgets and mobile services, and historic Web companies such as Opera and Mozilla strongly moving their activities into the mobile space.
Previously, Romeo points out, the mobile experience was based on voice and messages. “Now, it's becoming more and more complex, with mobile broadband bringing experiences where communication is still important, but becoming enriched with harder services like content, social networking, and value-added services.”
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