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Mac App Store: Developer godsend or Evil Empire?

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Ken Case, the CEO of longtime Mac app developer The Omni Group, loves the new Mac App Store.

But not everyone agrees with him.

"I think the Mac App Store is a huge improvement for the platform as a whole," Case says. "It solves a need that a lot of consumers have had, which is 'How do I find software for the Mac? Where do I go to buy it? How do I know if it's any good? Can I trust the vendor that I'm working with?'"

Apple's Mac App Store has been open for less than a month, but that's been long enough for Mac OS X developers to have developed strong opinions about it, both pro and con. During last week's Macworld Expo, The Reg sat down with execs from both prominent and lesser-known Mac-app publishers to learn of their experiences with Apple, its app-approval policies and procedures, and how the Mac App Store is affecting their business.

We came away with an earful.

The Omni Group, Ken Case's company, has a long track record upon which to base his generally positive take on the Mac App Store. The developers behind The Omni Group started programming on Steve Jobs' NeXT platform in 1989 and started their company in 1992. When Mac OS X launched in 2001, The Omni group was ready with OmniGraffle and OmniWeb. The company now offers 10 products for Mac OS X – five paid and five free.

"We have found so far that the Mac Apps Store has mostly been additional business for us," Case said. "It varies by product line. For some products [such as Omni Focus], we've seen a little bit of a dip in our direct sales, although not nearly as much as has been added by the App Store sales."

Rich Siegel, president and CEO of Bare Bones Software, developers and publishers of BBEdit ("It doesn't suck."®), TextWrangler, WeatherCal, and Yojimbo, has also been in the Mac market since 1992. Like Case, he has also seen improved sales as a result of the Mac App Store. "The sales through the App Store seem to be additive," he said. "I hope they stay that way." Since the Mac App Store rolled out, TextWrangler has been downloaded about 150,000 times.

Reid Lewis, president of both the Enterprise Desktop Alliance and of content-management and connectivity software vendor GroupLogic shared with us his theory of the value of the Mac Apps Store. "The hardest thing that any software vendor faces is not creating software. It's selling it," he said. "In order to sell things, you need exposure."

From Lewis' point of view, the Mac App Store provides that exposure. "Take a grocery store, for example," he said. "You make spaghetti sauce, what do you need? You need it on the shelf. Consumers walk into the grocery store, they're like: 'Spaghetti, yeah, yeah, yeah – that one looks interesting' because you've done a good packaging job, and they buy it. If it's not on the shelf, they can't buy it. As a developer, the shelf is global."

It's all about finding your spot on that global shelf, said Lewis. "How do you get on the shelf? Well, you spend a lot of marketing money, you build a big channel, or your customer never gets to pick you off the shelf and buy you. So I see the Mac App Store as a huge shelf. ... It's a way for vendors who may be skilled at creating software but not necessarily skilled at getting it in front of people to get it in front of those customers. It will mean that more developers can bring products to market, and customers have a much wider choice."

The Omni Group's CEO also talked about store shelves, but his example was more direct: retail software stores and the experience of shopping in them. "The stuff that's on the shelves in boxes, that's software that has been vetted. Somebody had to pay enough money to get it shipped, and somebody had to approve it to put it on the shelf, and so that's probably reputable and probably quality."

Case, however, thinks that the Mac App Store gives more legitimacy to an app than does a retail store. "But even [in retail stores] it was kind of hit-and-miss: you go and buy some boxed software and it turns out it's terrible," he said. "But of course nobody goes to retail stores to look for software anymore. There is a little bit if you go to an Apple [bricks and mortar] store, but it's a very, very dwindling shelf space."

To Case, the Mac App Store means he doesn't have to worry about that dwindling shelf space anymore. "The biggest thing that [the Mac App Store] has changed for our business is that we've shut down retail here in the States. That's enough of printing boxes, and shipping them places, and building up inventory, and having to destroy boxes when we've released a new version. All of those headaches are just gone."

From his point of view, the 30 per cent cut that Apple takes is a win-win deal. "Compared to, say, the retail percentages," he told us, "that's more the other way around in retail – you're lucky if you clear 30 per cent by the time everything is done. So having a channel where you get to keep 70 per cent? That's great."

And it's a win-win-win if you add in the consumer, Case believes. "The purchasing experience is just so much easier. You press this button – and presumably you've already set up your iTunes account in there, so it's just going to charge your credit card – download the app, it's installed on your Dock, and you're done. You don't have to go figure out what kind of an installer it is. 'Is it a package? Is it a DMG? Is it a ZIP? Do I drag it to Applications? Do I have to use an installer? How do I uninstall it later?'"

Siegel, however, isn't yet convinced that Apple's 30 per cent take is good for his company. He's waiting for more time, more data. "The obvious reason for not instantly converting all of our sales over to the App Store is we don't want to instantly give up 30 per cent of our revenue stream," he said. "Numerically, if the App Store generates 130 per cent additional sales, then the 30 per cent is worth it."

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