Monday, February 25th, 2008

Mobile Applications, RIP

Category: Mobile

Michael Mace, a former Palm VP, says the business of native mobile apps is dying. He includes a quote from Palm veteran Elia Freedman summarizing why some of us have found mobile application development to be a deeply frustrating experience.

From the technical perspective, there are a couple of big issues. One is the proliferation of operating systems. Back in the late 1990s there were two platforms we had to worry about, Pocket PC and Palm OS. Symbian was there too, but it was in Europe and few people here were paying attention. Now there are at least ten platforms. Microsoft alone has several — two versions of Windows Mobile, Tablet PC, and so on. [Elia didn’t mention it, but the fragmentation of Java makes this situation even worse.]

I call it three million platforms with a hundred users each (link).

The second technical issue is certification. The walls are being formed around devices in ways they never were before. Now I have to certify with both the OS and with each carrier, and it costs me thousands of dollars. So my costs are through the roof. On top of that, the adoption rate of mobile applications has gone down. So I have to pay more to sell less.

Then there’s marketing. Here too there are two issues. The first is vertical marketing. Few mobile devices align with verticals, which makes it hard for a vertical application developer like us to partner with any particular device. For example, Palm even at its height had no more than 20% of real estate agents. To cover our development costs on 20% of target customer base, I had to charge more than the customers could pay. So I was forced to make my application work on more platforms, which pushed me back into the million platforms problem.

The other marketing problem is the disappearance of horizontal distribution. You used to have some resellers and free software sites on the web that promoted mobile shareware and commercial products at low or no charge. You could also work through the hardware vendors to get to customers. We were masters of this; at one point we were bundled on 85% of mobile computing devices. We had retail distribution too.

Where’s he going with this? You can guess where he’s going.

Meanwhile, there is now an alternative platform for mobile developers. It’s horribly flawed technically, not at all optimized for mobile usage, and in fact was designed for a completely different form of computing. It would be hard to create a computing architecture more inappropriate for use over a cellular data network. But it has a business model that sweeps away all of the barriers in the mobile market. Mobile developers are starting to switch to it, a trickle that is soon going to grow. And this time I think the flash flood will last.

I think Web applications are going to destroy most native app development for mobiles. Not because the Web is a better technology for mobile, but because it has a better business model.

Think about it: If you’re creating a website, you don’t have to get permission from a carrier. You don’t have to get anything certified by anyone. You don’t have to beg for placement on the deck, and you don’t have to pay half your revenue to a reseller. In fact, the operator, handset vendor, and OS vendor probably won’t even be aware that you exist. It’ll just be you and the user, communicating directly.

Until recently, a couple of barriers prevented this from working. The first was the absence of flat-rate data plans. They have been around for a while in the US, but in Europe they are only now appearing. Before flat-rate, users were very fearful of exploring the mobile web because they risked ending up with a thousand-Euro mobile bill. That fear is now receding. The second barrier was the extremely bad quality of mobile browsers. Many of them still stink, but the high quality of Apple’s iPhone browser, coupled with Nokia’s licensing of WebKit, points to a future in which most mobile browsers will be reasonably feature-complete. The market will force this — mobile companies how have to ship a full browser in order to keep up with Apple, and operators have to give full access to it.

As Michael points out, it’s not all gloom and doom for mobile apps, especially with the official iPhone SDK due out real soon now. For basic business apps, though, maybe we’ve already reached the tipping point.

Posted by Michael Mahemoff at 2:24 pm
6 Comments

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very interesting insights… it seems iPhone web app development is the safest way to go…

Comment by Mark Holton — February 25, 2008

This is a reasonably typical US-centric point of view. Very few places in the world have Telecom companies who lock down their phones to the point of requiring an expensive certification process for each new application version like the US does. And, believe it or not, there are whole other countries out there where you can download an application that you like to a phone that you’ve bought and pay connection charges for.

A whole new world.

Comment by Aquarion — February 25, 2008

FUD. Mobile apps are definitely not dead, just maybe old formats (Palm, Symbian, etc). I’ve seen some Flash apps here in Seattle that are going strong, and they work cross-platform with touchscreens, numpads and keyboards with almost no extra work. Once Flash for Mobile 3 hits, they’ll be even more content-rich.
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Java has more cross-compatibility issues, but Java won’t die for a long time (too many evangelists and college students — oh yeah and Android). Windows-based handhelds are widespread, and Linux/iPhone variants are hot on their heels, desktop apps are being ported to handhelds faster than ever.
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International mobile data prices can be nasty outside of the US (especially when roaming), so a download-once and play-forever app will retain value until data prices drop sharply — not to mention people who like to take their handheld off-grid, for GPS, trail maps, photos, voice recorders, the list goes on…
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Right now it’s much more difficult to develop RIAs that work identically across mobile browsers than to create a Flash or Java app, especially with any kind of animated or pretty graphics.
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Of course a former Palm VP would say this, he needs an explanation both for the past and for the new business model he’s creating.

Comment by Charles — February 25, 2008

Strictly from a user perspective, I recently switched over from Blackberry to iPhone recently and I really miss the native Facebook, IM and other apps. Sure iPhone-centric Meebo, Facebook and other apps are great but when I click on those icons on my iPhone, it takes a good few seconds before I get to see the information. On the Blackberry they are constantly (or on a set interval) updated so when I click on the app, I can instantly see what I want to see. This is the instant gratification culture. I don’t want to blame the slow at&t network because I see this problem even on a very fast Wi-Fi network. The latency issue will haunt web apps on the phone, unless some browser modifications are made so that these web based apps can go and ping the servers behind the scenes. Not to mention as others pointed out, offline data access is another feature that is lacking in web apps for the mobile platform. A Google Gears for mobile would be nice as I have the 16 GB version, I am willing to dedicate 25% of that for app data storage. Of course, Flash Mobile and may be Air Mobile are other possible avenues to resolve this issue too.

From the business standpoint, I understand the frustations of mobile app developers, some details have leaked out about Apple upcoming iPhone SDK but I am really interested in the revenue model for app developers and how it will be sold via iTunes. I am excited about seeing iTunes as a platform for software delivery. It would be great if iTunes does for apps what it has done for apps. But it will be interesting to see the busines model. One thing is for sure as much as Apple will charge to host/sell your apps, you are bound to get lots of free marketing and popularity if you have a hit app on your hands (the analogy to songs is really intriguing here).

Here is a question for discussion, do you think Adobe should come out a Flash software distribution platform like iTunes to sell mobile Flash (or Air) widgets/apps for mobile devices?

Comment by dynaMo13 — February 26, 2008

Wow, I am all over the place on that previous comments, I wish there was a way to edit the comment.

“It would be great if iTunes does for apps what it has done for songs.”

Comment by dynaMo13 — February 26, 2008

I loved the original article, the charts are great too, a very convincing argument was made. Now is a great time to be doing web apps for phones. A rapidly increasing number of phones are running the same browser as the Iphone, webkit, javascriptcore, etc.

A whole of products could be done as a web app, or a client app.

Gaming will always be focused on client applications. There is a market for free web games.. but electronic arts and vivendi will still rake money in hand over fist selling installable games.

Media is going to be a gray area. Many mobile browser don’t support sound, so any rich media will actually occur outside the browser, either in a native media player or in custom client code made by content providers.

Comment by mathiastck — February 29, 2008

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