First things first: The closed-market app store has its drawbacks. These disadvantages and how they can be circumvented, I will discuss in this blog in the next few months and next February in my book “The App Store Economy”.
But as a developer one is interested in the advantages first. For how to properly use auspicious opportunities, is as important as the caution against potential dangers. Therefore, this series is dedicated to the wonderfully optimistic question:
“Why will I get rich on the app store?”
The fact that it’s not that easy to achieve the great app success, is likely to be even known in the smallest programming sweatshop at the end of the world. Nevertheless, vendors on an app store benefit from all market effects and cost advantages, that are found in information goods. Additionally, many problems of software providers in open systems do not exist. One of the most important elements of the app store economy is:
The big software companies of the world owe their success to lock-in. Although it may seem mean: The companies want to lock-in their users and force them to buy their products.
Once you have installed a few apps and learned to deal with an operating system, the jump to another platform is difficult. Purchased apps can not be transferred to another platform, even if an app is available in the alternate system. The user then loses all the previously purchased apps, therefore increased loyalty is assumed, which can also be converted into app sales. The switch to another product adds even more problems: You have to learn to use the new OS, migrate data and adjust heaps of settings.
No wonder that most users remain loyal to their platform. Microsoft has their Windows users locked-in, but also an iPhone owner has to think twice whether they should be switching over to Android.
Good for the developers, because platform loyalty is the basic requirement for creating long-term app clients. Now it’s up to you, dear developers. Look for ways to create lock-in in your apps. If that works, you have the ability to establish profitable revenue models such as monthly subscription fees.
But for them to remain in the fenced pasture your user sheep also have to be maintained and cherished. Otherwise they break out – despite the lock-in.
In the next part of the series I will explore the power of software development kits.