I spent some time yesterday at a conference discussing next generation operator strategies to become a "smart pipe" - the goal being for operators to avoid becoming a "dumb" (and low margin?) pipe. The discussion got interesting when operators started outlining what they were offering to developers, and the small group of developers who were present had an opportunity to respond as to what they wanted from operators.
What are operators building?
- Application stores - with approval processes, certification processes, and a way to provide access to X million operator subscribers
- Widget platforms - to let developers create applications using web standards code with access to device API's (JIL, OMTP BONDI)
- Network APIs to enable access to billing/location/messaging
What do developers want?
- Simple, fast release processes, without multiple layers of certification (one developer cited total cost for all the certification testing being $10,000 on a single game - a significant proportion of the development budget)
- Fair share of the retail price - the "standard" of 70:30 is fine in principle, but the reality with operator stores is that when operators require small developers to go through aggregators even with the headline split this drops to closer to 10-25% of the actual revenue to the developer
- Distribution of applications, with meaningful ways to market individual applications other than "pay $25,000 for an "app of the week" banner on our wap store"
There seems to be a bit of a gap between what operators are building and what developers today want.
At any discussion that includes developers the elephant in the room is the Apple App Store - which everyone agrees is a huge success, both for developers, and for apple - even if it's only a success for apple as measured in iTouch + iPhone revenues (but that is Apple's focus, so a fair way to measure it)
The interesting thing is that for a developer the App Store gives them much of what they actually want. Developer's perspective on the App Store is:
- A single point of contact to reach all iPhone & iTouch customers on all networks worldwide
- A simple approval process - submit your application to apple, and it will be approved/rejected within 1 week without any additional effort required. No liason with external test houses, or managing multiple certification processes.
- Easy to understand revenue share model
- Apple actually pay out the revenue share in a reasonably timely manner
Apple don't provide access to 100's of millions of customers, nor do they provide flexibility of development environments on device (it's Objective C or nothing) nor do they provide much in the way of network APIs. Maybe operators should look at the reality of being in business as a mobile application developer - and realise that the main challenges are not in the technology, but in the basics of the business steps needed to get your technology into the hands of the consumers who will see the benefit, and pay for it.
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