Hard Case: Addicted to the App Store

Posted 02/09/2010 at 1:00pm | by Loyd Case

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Now that the iPad announcement is behind us, it’s worth taking a closer look at some of the recent happenings surrounding the iPad rollout.

The iPad was criticized by quite a few industry folk – including those who are generally pro-Apple – for its shortcomings: lack of integrated USB and memory card reader, no built-in webcam, lack of multitasking and no support of Adobe Flash. In essence, the iPad is a big iPod Touch.

I think a much bigger deal than any of those hardware issues is the app store. Here’s a device that’s priced within striking distance of Netbook territory, yet you’ll only be able to get apps approved by Apple, through Apple’s own app store. I suppose at some point someone will jailbreak the iPad, but that’s something only a few users will ever attempt. Heck, more users will root their Android phones than ever jailbreak an iPad.

This touches on a larger issue that seems to be gathering momentum around the industry: tighter control over applications and content. During the era of the PC hegemony, which is slowly coming to an end, the applications universe was wide open. Open source devotees may moan about Microsoft’s control over the OS, but Microsoft never tried to dictate what apps could be written or sold on Windows. For that matter, the PC has been a fabulously open hardware platform.

Apple’s MacOS has been more tightly controlled, but even Apple hasn’t tried to control what apps are available on the Mac. To some extent, they’ve offered limited support to certain classes of application developers – lack of support for gaming on the Mac is legendary – but they’ve not actively prevented apps from being developed on MacOS. The same hasn’t been true for the iPhone – all iPhone apps have to be approved, which means you get situations like Google Voice not being allowed on the iPhone.

It’s worth turning to the recent kerfuffle between Amazon and Macmillan. Amazon wanted to charge a maximum of $9.99 for ebooks sold through its store onto the company’s own Kindle line of ebook readers. In essence, Amazon was subsidizing sales of the Kindle, and trying to jumpstart a new type of content business. Macmillan, on the other hand, wanted to be able to set its own prices, worrying that consumers would become used to a $9.99 price point. Although Amazon may have been paying more, it was selling some ebooks at a loss to maintain the lower price.

Amazon has run into a problem we’re seeing more often these days: the blurring between content provider and hardware vendor, using hardware to lock in types of content. In Amazon’s case, this may in the end be a losing proposition – instead, Amazon should have worked with the entire ebook reader industry to make Amazon’s content available on all ebook readers.

Anyone who follows console gaming, of course, recognizes this model – game consoles have long tried to lock in exclusives, only allow games which make it through the console company’s approval process and otherwise control what users can buy. What’s interesting is that the game industry and the console companies are – ever so slightly – loosening their grip. We’re seeing many more cross-platform titles (though the games still have to go through the approval process), and some loosening of tight controls, as in Microsoft’s Xbox Live Arcade. (The approval process still exists, it’s just a little more forgiving for Arcade titles.)

At CES, it seemed like everyone was trying to set up its own equivalent of the app store, whether it was just for content or for actual applications. Interestingly, most of the platforms underlying these app or content environments are based on some flavor of Linux. The irony is obvious: using an open source OS to lock down content to a particular platform.

Perhaps most interesting is the dance that Google is doing with Android and Chrome OS. Google seems to want to tightly control the hardware environment, as we saw with the Chrome OS rollout. Yet they also are willing to let people dig into the hardware just a little, not pushing too hard to keep people from rooting their Android phones. And the app environment looks to be much more open.

Which model will win out? I can’t say for sure, but I’m hoping a more open environment eventually wins out. I hope Amazon comes to its senses, and simply makes sure its books are available on all ebook readers. I hope that Apple recognizes it will sell more hardware if it allows app developers freer rein.

What is happening is the classic case of the market – with a lot of clever marketing behind these efforts – eventually deciding. That means a lot of people will buy a lot of hardware that will someday be useless. But then, that’s always been true in the tech business.