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Mobile payment wars adds to developer headaches

If you are in the business of developing mobile apps, you mainly care about making money. And to make money, you have to charge for it, and in-app billing is arguably among the better ways to charge for an app.

The intense battle between not only payment players but also distribution outlets complicates things enormously for app developers. Apple forces you to use iTunes, Google forces you to use Google Wallet, and lately Samsung announced you have to use their billing and advertising API our you will not be in their app store (from their email sent to app publishers):

“According to the policies of Samsung Apps, application registration using 3 Party billing and Ad system will be restricted from March 1st, 2012. (In App Ad (Android Platform) will be restricted from August 1st, 2012.)”

And there are others trying to control what a developer does. Verizon is effectively blocking Google Wallet from their users, being a telco that has interests in their own wallet initiative, Isis. This is now being challenged by a Stanford professor, who has thankfully gotten the ball rolling on this seemingly illegal attempt by Verizon.

Is this just me, or does this artificial forcing of developer choices seem crazy? Are you now to build in separate payments, ad networks and who knows what else into your app depending on which OS you support, which app store you distribute to, and now which mobile operator your end user is on? I thank professor van Schewick to be among the first to try and end this madness, and hope the pursuit of fairness extends beyond operator control attempts to establishing a free market for application components in general. Let the best wallet and best ad network and best whatever win. Don’t kill the market for developers and users by being greedy and try to own the pie. Let’s keep Dilbert style strategies where they belong…

Dilbert.com

Disclaimer: The views expressed on this post are mine and do not reflect the views of any clients or companies I am currently working for or have worked for.

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Putting the Aussie “VC Gold Rush” in perspective

There is excitement to be felt among Aussie entrepreneurs about a proclaimed “Gold Rush in venture capital investment for Aussie start-ups”. Indeed, there have been some exciting announcements lately, but let’s put it all in perspective. The article in The Age linked to above mentions a number of investments in recent months that amount to approximately $22m in Q3.  Dow Jones estimated US VC investment amounted to $8.4bn in Q3, where $1.3bn was in the same tech space as the companies mentioned by The Age.

If you do a straight per capita comparison, that should have meant that Aussie investments should have been >$100m in the same period, but the level is instead is 1/4th of that (or 1/27th of the total 8.4bn). Considering that $15m of the $22m came from a US VC, not a local one, I would be somewhat hesitant using the superlatives here.

Also, what most of the tech start-ups in this country have to realize, their competition is not in Sydney or Melbourne, your competition will come from the Silicon Valley. Guaranteed. Any start-up in Sydney with a global value proposition needs to be looking across the pond the moment you start creating the first page of your business plan. You will not find gold here, but you may find some seed capital to get you started.

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Why choosing a mobile platform is like choosing a soft drink

With Adobe’s recent announcement essentially killing Flash as a mobile platform and throwing everything behind HTML5, it will no doubt ignite the fire under HTML5 as the platform of choice for anyone wanting to develop a mobile service. However, if you are a mobile developer – or any company thinking of developing a mobile offering, you should think through your choices a bit more carefully.

Mobile guru Volker Hirsch tackled the question in his blog, where he argues against all doomsayers of mobile apps. Yes, apps are hard, but have an edge in user experience and performance which will not go away anytime soon.  Always brilliant Vision Mobile make the following points on HTML5 in their recent report ‘Mobile Platforms: The Clash of Ecosystems‘:

“In reality, however, HTML5 is still far from becoming a replacement for native applications. Multiple technical gaps still exist, such as incompatibilities between different web browsers, poor performance on mobile devices and a lack of 3D graphics.  More importantly, HTML5 lacks the properties of a complete application platform. The HTML5 specification merely defines programming interfaces for web run-times (i.e., “browsers”). HTML5 does not address key areas an application platform would need to challenge iOS and Android, namely application discovery, distribution, monetisation and retailing.”

Of course, the choice goes far beyond web vs app. Australian mobile experts Tigerspike recently released a very good report in June on what brands and developers should consider when choosing mobile platform. Among the key very good points that Tigerspike mention are:

  • Know your audience
  • What objectives are you trying to achieve with your service
  • Understand the importance of what is a compelling user experience
  • Know the route to market

There is a point that Tigerspike overlooks though: They mention that app stores are key for app discovery. This is a truth with modifications.  With several hundreds of thousand of apps available, dropping an app is ZERO guarantee for making money, and any mobile provider/developer needs to start developing some savvy in marketing their app/service.

Tigerspike also makes a good point that if you do choose to develop an application, using a multi-platform development framework is usually a good way to go. They point out however, that the platforms often make testing difficult and that few support all the major platforms. If you are looking for a multi-platform framework, this needs to be a key decision criteria. You will not realize your revenue expectations unless you maximize distribution.

On that last point, developers who are unhappy with the revenues made on iTunes should consider that feature phones are not dead, and data plans are rolling out even in less advanced market, making it a potential target to earn some hard needed revenue:

So how do you choose what to develop for? In the end, the choice of platform was summarized quite brilliantly by Paul Marshal from Australian company Lasoo at the recent “Planet of the Apps” conference in Sydney. He said it is not about “good vs evil”, “easy vs hard” etc. He said it is kind of like asking a consumer would you like your Coke in a can or a bottle. In the end the consumer decides, and you need to understand and cater to this to maximize uptake and usage.

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