Chicago (IL) – T-Mobile has no intention to let Apple just run away with its AppStore
and the world’s cellphone software buyers in its pockets. While the
AppStore is reporting early success, Apple’s iPhone and AppStore may
face strong competition from its European carrier partner T-Mobile: The
Germans are developing an application store that is expected to arrive
this fall and support pretty much all mobile platforms – with the
exception of the iPhone.
It is no surprise that Apple's competitors are taking a closer look at the stellar success of the company's iPhone application warehouse that raked in $30 million in revenue in just one month. The first company to strike back will be T-Mobile, oddly enough Apple's exclusive iPhone carrier in Germany. T-Mobile is expected to unveil its own application store in the U.S. this autumn, according to Moconews.net.
"T-Mobile is working with the industry to foster an open wireless services platform which will provide developers with the tools and information they need to make new, innovative experiences available to T-Mobile’s more than 31.5 million customers," T-Mobile's director of Mobile Applications and Partner Programs Venetia Espinoza said.
Unlike the App Store, T-Mobile's application store will offer third-party applications for the carrier's entire line-up, from smartphones to feature phones. Specifically, the store will cover Windows Mobile, Android, Sidekick and Java-enabled mobile phones. T-Mobile has already launched a developer site for which - similar to the App Store - developers will have to submit their applications to T-Mobile for testing and certification. Developers will also be able to rent “DeviceAnywhere” lab time to test and debug their application remotely on a wide range of real devices connected to the T-Mobile network.
Developer will share revenue from sales of their applications with the carrier. The terms of the revenue-sharing deal have not been disclosed, except for the fact that the percentage that a developer gets will depend on application's use of the carrier's network resources. This means, for example, that an application that streams video will get less percentage than a text messaging application. It is unknown how T-Mobile plans to handle free applications and if it plans to carry them at all. T-Mobile noted that it will not provide preferential treatment to any application in the store. Instead, it will order them according to their popularity.
Although App Store is now in the spotlight, T-Mobile’s store should not be dismissed. Its 31.5 million subscribers base in the U.S. make T-Mobile's store a worthy opponent to Apple's current 6 million installed user base worldwide (though T-Mobile is the smallest of the four largest nationwide U.S. cellphone carriers). A wide range of mobile phone platforms is certainly advantage over App Store which exclusively offers only applications for the iPhone.
It will be interesting to see how T-Mobile’s strategy will pan out. Apple’s iTunes was always positioned as a tool to promote sales of high-margin iPods and the AppStore, besides being a cash production machine, is developing into a promotional platform for iPhones as well. If T-Mobile is able to launch its application store with a similar product strategy, the store could ultimately be impacting iPhone sales in the U.S., once other cellphone developers are able to catch up with Apple in terms of hardware – we are thinking about Sony’s Xperia X1 in particular.
Jack Gold, research analyst at J. Gold Associates, is not surprised that competitors are trying to clone the App Store now that it clearly demonstrated its potential. "It is clear that the revenue capability of Apple's App Store and iTunes has made 'cloning' such an offering attractive to many carriers who are trying to increase revenues while at the same time seeing decreasing profits from their basic services," said Gold in an email interview with TG Daily. "Clearly, services is where a lot of potential profit lies. What isn't so clear is the best way for the carriers to tap into this revenue. But all of them will try it, and some will succeed."
The analyst expects rest of the industry, including handset makers, will follow with similar applications stores. "Moving forward, not only the carriers, but also the device manufacturers such as Nokia will try to get into the services and applications sales business," he said. "I expect to see all the major carriers and more of the manufacturers provide such services, even Microsoft."
However, competitors once again face the same problem: They don't control the whole experience and have to cover for a wide range of incompatible platforms and devices, as opposed to App Store that is supplying to only platform. "When a large number of different applications are targeted at different mobile phone platforms, some handsets or platforms may not have good mechanisms for downloading and managing applications," Gold said. "The carrier who runs the application store would need to require each handset vendor to add such capability to their handsets."
It is no surprise that Apple's competitors are taking a closer look at the stellar success of the company's iPhone application warehouse that raked in $30 million in revenue in just one month. The first company to strike back will be T-Mobile, oddly enough Apple's exclusive iPhone carrier in Germany. T-Mobile is expected to unveil its own application store in the U.S. this autumn, according to Moconews.net.
"T-Mobile is working with the industry to foster an open wireless services platform which will provide developers with the tools and information they need to make new, innovative experiences available to T-Mobile’s more than 31.5 million customers," T-Mobile's director of Mobile Applications and Partner Programs Venetia Espinoza said.
Unlike the App Store, T-Mobile's application store will offer third-party applications for the carrier's entire line-up, from smartphones to feature phones. Specifically, the store will cover Windows Mobile, Android, Sidekick and Java-enabled mobile phones. T-Mobile has already launched a developer site for which - similar to the App Store - developers will have to submit their applications to T-Mobile for testing and certification. Developers will also be able to rent “DeviceAnywhere” lab time to test and debug their application remotely on a wide range of real devices connected to the T-Mobile network.
Developer will share revenue from sales of their applications with the carrier. The terms of the revenue-sharing deal have not been disclosed, except for the fact that the percentage that a developer gets will depend on application's use of the carrier's network resources. This means, for example, that an application that streams video will get less percentage than a text messaging application. It is unknown how T-Mobile plans to handle free applications and if it plans to carry them at all. T-Mobile noted that it will not provide preferential treatment to any application in the store. Instead, it will order them according to their popularity.
Although App Store is now in the spotlight, T-Mobile’s store should not be dismissed. Its 31.5 million subscribers base in the U.S. make T-Mobile's store a worthy opponent to Apple's current 6 million installed user base worldwide (though T-Mobile is the smallest of the four largest nationwide U.S. cellphone carriers). A wide range of mobile phone platforms is certainly advantage over App Store which exclusively offers only applications for the iPhone.
It will be interesting to see how T-Mobile’s strategy will pan out. Apple’s iTunes was always positioned as a tool to promote sales of high-margin iPods and the AppStore, besides being a cash production machine, is developing into a promotional platform for iPhones as well. If T-Mobile is able to launch its application store with a similar product strategy, the store could ultimately be impacting iPhone sales in the U.S., once other cellphone developers are able to catch up with Apple in terms of hardware – we are thinking about Sony’s Xperia X1 in particular.
Jack Gold, research analyst at J. Gold Associates, is not surprised that competitors are trying to clone the App Store now that it clearly demonstrated its potential. "It is clear that the revenue capability of Apple's App Store and iTunes has made 'cloning' such an offering attractive to many carriers who are trying to increase revenues while at the same time seeing decreasing profits from their basic services," said Gold in an email interview with TG Daily. "Clearly, services is where a lot of potential profit lies. What isn't so clear is the best way for the carriers to tap into this revenue. But all of them will try it, and some will succeed."
The analyst expects rest of the industry, including handset makers, will follow with similar applications stores. "Moving forward, not only the carriers, but also the device manufacturers such as Nokia will try to get into the services and applications sales business," he said. "I expect to see all the major carriers and more of the manufacturers provide such services, even Microsoft."
However, competitors once again face the same problem: They don't control the whole experience and have to cover for a wide range of incompatible platforms and devices, as opposed to App Store that is supplying to only platform. "When a large number of different applications are targeted at different mobile phone platforms, some handsets or platforms may not have good mechanisms for downloading and managing applications," Gold said. "The carrier who runs the application store would need to require each handset vendor to add such capability to their handsets."