MONTREAL - New online "app" stores, like grocery stores for mobile phones, are trying to take a bite out of Apple's App Store for its popular iPhone.
The popularity of games, maps, weather forecasts, traveller tools like world clocks and literally thousands of other software applications for mobile phones are driving their growth and attracting new players with brand name recognition.
BlackBerry maker Research In Motion (TSX:RIM), software maker Microsoft Inc. (Nasdaq:MSFT), search engine giant Google (Nasdaq:GOOG) through its Android Market, leading cellphone supplier Nokia, and consumer electronics company Samsung are among those joining the trend with their own online app stores.
RIM said Wednesday that it's calling its storefront, BlackBerry App World.
It will go online at the end of this month with software applications, both paid and free, for consumers and businesses, said Jeff McDowell, RIM's vice-president of Global Alliances.
An online app store is one more thing that consumers are considering when they're buying a smartphone, McDowell said from Waterloo, Ont., where RIM is headquartered.
"It's a check mark that consumers want to know," he said. "It will absolutely drive greater adoption of BlackBerry."
RIM is looking to set itself apart from Apple's App store on several fronts, including making it easier to keep apps when BlackBerrys are upgraded, lost or changed and rating the popularity of apps based on feedback and price points instead of by the number of downloads, McDowell said.
Apple has said the App Store had surpassed 500 million downloads and there were more than 15,000 apps available. It has a combination of both free and paid apps.
RIM is also hoping to win over developers with pricing.
"The developers are keeping 80 per cent of their revenue," McDowell said.
Those with Apple keep 70 per cent of revenues, a model being more widely adopted by players in the industry.
IDC Canada analyst Kevin Restivo said even though Apple is the "pioneer" in app stores, there's room for competitors.
"That's why you see every supplier, pretty much any smartphone supplier in the market, will in some way, shape, or form, be involved in an app store, if not outright create their own app store," Restivo said from Toronto.
Online app stores aren't new. Handango.com, youpark.com and others allow consumers to buy apps for a variety of devices.
But these brand-name app stores create a direct relationship with consumers and another revenue stream, he said.
It's the smartphones advanced operating system that allows users to download and install third-party software applications just like a computer that sets it apart from basic talk and text cellphones, and increasingly popular feature phones such as Samsung's touchscreen Instinct.
Feature phones do such things as surf the web, give users access to email and let them watch live TV just like smartphones, but their operating systems either don't run apps or can't run a wide variety of them.
David MacQueen of U.K.-based Strategy Analytics said the mobile content market in 2009 is worth an estimated US$62.4 billion, of which games and other applications are expected to be worth just more than US$6 billion of that total.
While there has been a big uptake in the use of apps, the average price has "really crashed down," he said from London.
"More and more people will continue to move to free and very low-cost applications," MacQueen said.
Microsoft also wants in the app store business, noting it has thousands of apps.
"We just never had a great distribution channel for them," said Greg Milligan, business development executive for mobility with Microsoft Canada.
"The 21,000 existing applications are great candidates for Microsoft Marketplace for Mobile, as many of them have already gone through the Windows Mobile certification process," he said.
Microsoft is set to open Windows Marketplace for Mobile app store this fall when it launches its new Windows 6.5 operating system for mobile phones.
"So as soon as you pull out a Windows Mobile 6.5 device, you've access to the (app) store."
MacQueen said while these brand-name app stores won't be competing with each other, it will be challenging for software developers who won't have one-size-fits-all apps.
"If you want to get your app out there, you've got to develop for all of these different app stores and all of these different devices."
