The Operators Strike Back: The Next Generation of App Stores

A lot has been written recently regarding appstores and the role, or lack thereof, of the mobile operator. Regarding roles, it is not that operators have been unaware, or that they’ve not tried in this space. Every mobile operator has their ‘legacy’ store, and the term walled garden would be an understatement. Ever been to one? What Apple has done with their App Store, and to a lesser extent, Android with its Market, is that they have reset the bar on usability and convenience for the subscriber, as well as ease of development (and thus building a critical mass within the development community).

The cat is out of the bag, so to speak, with Apple, but operators still have the chance to play what they consider to be their rightful role. The key to success will be to balance the points mentioned above with their business model, a model different from the OS platform provider. It embraces the notion of an open and dynamic market for applications across platforms, and the role that the operator may play in brokering applications across the various open OSs supported within their network.

Verizon Wireless, based on their announcements, is taking this approach. As reported in Verizon to its smartphones: thou shalt have no other app store before mine (Jul 13, 2009), the operator will handle all billing and will have control over what 3^rd party appstores and applications are made available on the handset out-of-the-box when its V CAST Apps Store launches before the end of 2009. They will revenue share with the application developers, and a subscriber will only need his or her single Verizon account for payments. A customer will still be able to access a 3^rd party appstore directly but only after taking the initiative to download the specific portal software for the store.

In Verizon’s favor, the operator promises a more streamlined application approval process than that for Apple, and is pushing for a set of common standards that would permit application developers to more easily adapt their applications for multiple OSs. Verizon has traditionally maintained more control over the user experience, and this approach seems to align with this.

Verizon states that developers will retain 70% of the proceeds, which is equal to that of Apple but a change from what mobile operators took in the past. This is acknowledgement that Verizon understands this new world, a world very different from the very limited operator-driven software portals of the past. They understand that they either create a business model and user experience equal to Apple or Google, or get cut out of the equation. In addition, there are larger issues at play. As Shaw Wu in The Wall Street Journal pointed out, an effective appstore is also key to facilitating hardware sales. Users are no longer interested in just a static hardware platform. Just like the PC, they expect applications and capabilities to evolve.

Telefonica with its planned ‘mstore’ offering (http://saladeprensa.telefonica.es/jsp/base.jsp?contenido=/jsp/notasdeprensa/notadetalle.jsp&id=0&origen=portada&idm=eng&pais=1&elem=13765&titulo=Telef%F3nica%20launches%20'mstore',...) is also taking the same approach, leveraging Telefonica’s strong Movistar branding. What is interesting is that they plan to eventually launch across their operating companies, a user base of 200M. This will provide developers with a critical mass for development. They have described the organization structure, application pricing, but have not detailed platforms supported or how mstore will interact with the likes of Microsoft’s Marketplace or Android’s Market. Much like Verizon, Movistar-branded handsets will have the store application pre-installed.

These are just two current examples of operators getting into the game. Others will follow. But what OS platforms will succeed? Where should operators place their efforts? Next time around I’ll look at the operator appstore from the perspective of the OS platform, taking guesses on which will succeed based on the strength of their developer communities as opposed to only looking at OS features and hardware.

Standards: Conformity at Any Cost?

By Jason Lackey, Marketing Manager, Innopath Software

The world of technology is a fascinating one, filled with multiple competing dynamics.

On the one hand, innovation is the engine of capitalism and it is from innovation that competitive advantage is gained. On the other hand, in order to ensure that your widget plays nicely with other widgets (as few make enough of a solution to play alone in a vacuum) standards are necessary.

With standards, it is possible to do things like build a better browser that will show your favorite Web pages as they are intended to look, but faster and better. With standards one can do things like manage phones OTA (Over The Air) and make support less of a nightmare for your subscribers. With standards a lot of things are possible, but these possibilities come with a cost.

Standards come from standards bodies. Standards bodies tend to be populated by people from companies with a vested interest in some technology but the standards efforts tend not to be a central focus of those people who often have their "real" jobs to do when they are not in standards meetings. The various vendors represented will tend to have different perspectives, goals and desires and this can make progress very slow at times.

In the world of mobile device management, standards are relatively new, just like the technology. Of course, the technology came first and in the absence of standards vendors, by necessity, created proprietary protocols. The first wave of real standardization was from the Open Mobile Alliance in the form of OMA-CP, Client Provisioning protocol. While far from perfect, mostly due to being a one way write-only protocol, CP got the ball rolling and helped illustrate the value to device management.

Recognizing the shortcomings of fire and forget, OMA followed up on CP with OMA-DM, a bidirectional protocol that let you read as well as write, allowing the operator to get feedback after device management actions have been taken. I guess some folks decided that it would be useful to know that something had been fixed by means other than the person holding the device telling you that it had been fixed. I further suppose that folks figured it would be useful to be able to do things like a basic diagnostic ping on the phone.

All this is good, but as I mentioned before standards can move slowly and in many cases the standards don't keep up with the technology, which is where things like a "Standards+" approach come in. A vendor which owns both ends of a client/server solution can do things like support standards such as OMA-DM as a base, but also offer extensions and enhancements above and beyond the standards.

This gives the advantage of interoperability out of the box while also providing additional functionality. Back when the Model T was introduced, it could be said that existing standards for road construction called for dirt or gravel and the car worked fine on those roads. When a road was enhanced beyond being a rutted goat trail, beyond the standards of the day, the car didn't stop running, it ran better and provided a better end user experience.

AT&T Device Redux

Dave Ginsburg

On the heels of a pulled BB Bold update (http://www.boygeniusreport.com/2009/09/04/att-pulls-blackberry-bold-software-upgrade/), rumors have it that they’ve now issued a recall on the recently launched Nokia Mural (http://www.boygeniusreport.com/2009/09/10/att-stops-all-sales-of-the-nokia-mural/) due to erroneous 2G vs 3G settings set at the factory. What is interesting is that the internal announcement hints of an available software update. Given that FOTA has proven to be both reliable and scalable at at least one other NA operator, the question is why AT&T doesn’t push an update to the impacted Murals. Is only a cabled update available and has Nokia not provided an OTA package due to the severity of the problem? Or, could FOTA have addressed the issue but the Mural is not FOTA capable? In this day and age, that seems hard to believe, but I’ve not seen evidence that FOTA is active on the handset. Any deeper insights into what could have been an easily prevented embarrassment?

Sweet Home rue de la Victoire

Telecoms is a wonderful industry although not without irony. For example, while we help our customers deliver better support to their subscribers remotely, over the air, it is also true when working on complex systems with many integration points and a lot of people involved, that it is often most effective to have a presence where your customers are. Evidently when buying multi-million euro solutions which are in the critical path of a core business function customers want to be able to get the vendor in the room and have a chat about things.

Thus, our latest office, in Paris:

InnoPath Software
52, rue de la Victoire, TMF Pôle
75009 Paris, France.
+ 33 1 56 53 63 60