Original URL: http://www.theregister.co.uk/2008/11/14/mobile_app_stores/

Adobe proposes open access to app stores

Operators scramble for a piece of the pie

By Wireless Watch

Posted in Mobile, 14th November 2008 18:07 GMT

Despite its co-dependent relationship with the iPhone, O2 UK plans to launch its own developer community and app store next year, which could put non-Apple handsets in a better position to compete with the iPhone and its App Store.

O2's Litmus project

The project, called Litmus, will offer developers virtual access to 40+ handsets in the O2 portfolio (though not the iPhone of course). They will be able to develop, trial and monitor applications to run across some or all of the phones, improving the efficiency of their efforts, and they will also be able to sell apps and content online or over the air. This looks similar to T-Mobile's plan to create its own software store, allowing developers and consumers to work across all its high end and midrange phones, rather than targeting each one separately.

The two initiatives show another way that European cellcos in particular are looking to establish a strong position in the mobile web value chain, by creating a single source for mobile content that is associated with their brand and network, rather than a phone maker's or internet player's platform. This will not only help them attract and retain high value, web savvy consumers, but should enable them to command a better slice of the revenue pie.

Speaking at the Mobile 2.0 conference in San Francisco, O2's head of product development, James Parton, said that Litmus will offer developers the tools to work collaboratively with selected customers in a live virtual laboratory, so that community members can build on one another's ideas and pool skills and experience. They will also be able to trial important parts of the O2 infrastructure, like messaging or billing systems.

Although Litmus seems to be envisaged mainly as a testbed at first, to encourage the creation of new applications for the O2 network and devices, it should quickly evolve into a fully blown store to compete with App Store, Android Market, RIM BlackBerry Store and others.

T-Mobile's initiative

In September, T-Mobile USA said it would launch its own applications store, despite its own close ties with Android Market. It released the beta version of its new devPartner Community program, which is expected to evolve early next year into a full blown content download portal and store, unified by the T-Mobile network and brand but available on all its supported handsets.

The initial point of the devPartner initiative is to provide developers with an easier and more efficient channel for dealing with T-Mobile. Many third party applications providers complain that they are deterred from working with carriers because they have too many restrictions, or are complicated to work with. This makes them more easily attracted to services run by vendors, which usually have more experience of working with developers.

Speaking at the CTIA Wireless IT and Entertainment event last week in San Francisco, T-Mobile USA's director of mobile apps and partner programs, Venetia Espinoza, said the devPartner Community model will enable developers to market their apps directly via the carrier's deck. They will earn between 50 per cent and 70 per cent of the revenues from the software, and will have the right to determine their own premium download pricing. From this week, the devPartner site will provide partners with rate cards and clickthrough agreements outlining the standard business arrangement with T-Mobile, which will also offer technical support, apps trials and a virtual laboratory.

Apple's store, despite popularity with consumers, is still criticized by some programmers for being over-controlled and mean with the revenue split so there is still an opportunity for operators to outshine it. The advantage large cellcos will have over Apple is their market reach. T-Mobile has 30 million subscribers in the US alone, three times the number of iPhones that are expected to be in use by the end of this year.

AT&T seeks unified midrange platform

Many operators are likely to concentrate their apps store efforts on midrange phones and the lower end of the mobile web spectrum, leaving the power users to shop in the heavily branded and marketed stores from smartphone vendors. AT&T's head of wireless and consumer businesses, Ralph de Vega, said at the recent Web 2.0 event in San Francisco that the operator saw the first step being to unify the operating systems running on lower end devices, in order to create a mass platform to attract developers. He did not say which systems AT&T was considering, but it wants to phase in a single software platform for handsets that fall below the smartphone category with full OSs like Windows, but are still able to support a web experience.

Such a platform would almost certainly be heavily focused on Java, and most likely a Linux-based OS such as Android, which – despite media determination to place it head-to-head with Apple and Symbian – is likely to target the mass midrange most effectively. However, Symbian itself has also been making major efforts in recent years to extend its reach down the value chain, although it is probably the least likely choice for AT&T, which has little history with Symbian or Nokia.

In de Vega's view, the market for a software platform, and an accompanying store, for the mass market, is wide open and will not be addressed by the likes of Apple. “We are actively looking for how to have an operating system that handles the low end phones so that developers will have a way to develop low end applications that don't need Android, Microsoft Windows or Mac OS X,” he said in an interview.

Adobe Air

Meanwhile, Adobe is set to follow rival Apple into the mobile apps game, but is seeking to provide a common platform that will be supported across stores from many operators and vendors, rather than creating its own portal. The Flash maker, whose dominance of mobile video streaming is dented by Apple's refusal to support the technology on the iPhone, will launch a mobile version of its Air product next year.

This will allow the same application to run across many cellphones, unlike its current mobile product, Flash Lite, which varies in implementation between different platforms. Kevin Lynch, Adobe's CTO, said at Web 2.0: “Of all the technologies on mobile phones, none of them has more than a 50 per cent reach. As a developer, you have to implement your content about 400 times right now. That is a complete mess.”

Adobe is hoping to improve its hand in the battle to control the mobile web, by offering a new business relationship for handset makers, software houses and operators, all linked into Air. For companies that agree to keep their implementations of Air open, so apps can be used from any online site, not just designated store, Adobe will eliminate royalties. This is not as generous as it sounds, as the company makes most of its revenues from tools rather than licensing, but the plan still sets some important precedents that could shift others' behaviour.

“We're democratizing the app store, if you will,” said Lynch, believing Adobe can steal an early march and take advantage of the operators' reluctant but steady moves away from walled gardens and towards open access.

No manufacturers have committed to using Air yet, though Nokia, Motorola and Verizon Wireless are among those participating in the effort to define open Air standards, the Open Screen Project.

Adobe is also working on a mobile version of fully blown Flash that will be optimized for smartphone browsers and should perform far better than the current release on mobile devices. Lynch told the conference he was optimistic that the new software would even gain Apple's approval and find its way on to the iPhone. Adobe has been creating a Flash implementation for the iconic smartphone, but this would need to be approved by Apple before it was made available to App Store users or even integrated with the phone.

Adobe launched the Open Screen Project in May, aiming to promote Flash and Air as the solution to the problems of content portability among mobile devices. Most important to the chances of Open Screen is the support of Nokia – despite its earlier strong endorsement of Microsoft alternative Silverlight. Indeed, Adobe has leveraged its massive installed base – over 500 million mobile devices have Flash Lite installed, and some vendors are even supporting fully fledged Flash on advanced mobile products – to ensure the support of all the cellphone majors. The top five – Nokia, Samsung, Motorola, LG and Sony Ericsson – are all involved, plus Ericsson itself. Among the chipmakers, Intel, ARM, Marvell and Qualcomm have signed up, plus Verizon and NTT DoCoMo.

In line with Adobe's recent corporate reorganization to integrate its desktop and mobile platforms, the new initiative will focus on a platform that will be consistent with Flash Player and Adobe AIR on desktop PCs and set-top boxes, helping developers and content creators to deliver a unified user experience and reduce their own costs and time to market.

The first implementation based on OpenScreen will make its debut in mid-2009. Flash Lite will transition to the new format and will eventually be replaced.

Copyright © 2008, Wireless Watch

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