GetJar, which distributes free mobile applications to consumers on the Internet and over the phone, said it is branching out its business by building application storefronts for wireless carriers. A few months ago, that would have been unheard of because carriers typically want to own the relationship with their subscribers. But with the success of Apple’s (NSDQ: AAPL) App store, which Steve Jobs said made $30 million in its first four weeks, copycats are really starting to take off. For example, earlier this month, I reported that T-Mobile will create an open storefront this fall that would allow developers to sell their applications freely to their subscribers, and yesterday Google (NSDQ: GOOG) announced the Android Market, a store for Android phones when they become available later this year. Of course, there are other app stores too, including Handango, which sells apps to smartphone users.
When I met up with Bill Scott, GetJar Network’s VP of sales and business development in Seattle this week, he said GetJar is seeing the same trend and is starting to work with carriers to distribute free apps on their decks. The numbers are convincing. So far, GetJar claims that consumers have downloaded 300 million applications in total from its site, with a monthly average of about 13 million downloads worldwide and more than 500,000 in the U.S. It distributes everything from Google Maps and Yahoo’s (NSDQ: YHOO) Go to nifty, but also less useful items, such as Disco Light, which makes your phone flash, and Battery Drainer, which makes your phone flash and beep until it’s dead. Adult entertainment is also fair game. The company initially had no intentions of being an app store, but Founder Ilja Laurs of Lithuania stumbled into it. As a game developer, he always had a hard time getting his games tested. One day he posted it on a website, asking people to download it for free and report any bugs (That also explains the company’s name…Jar is the suffix for a Java file). Since then, Laurs added content from other developers and traffic soared — so much so, it got the attention of Accel Partners, who invested $6 million. Now the company has offices in London, Lithuania and Palo Alto, Calif., and is expanding its relationships with carriers.
Highlights from our conversation after the jump…
– How GetJar makes money: Scott said all the applications are available for free, so the 15-employee company makes money through advertising on the site, where developers can pay to be one of the featured apps.
– Carrier partners: It’s working with about 10 carriers worldwide, the most high-profile being 3 in the UK. It’s helping to power a site at m.threeUK.getjar.com, where it provides free applications to the company’s subscribers. Scott said there’s multiple reasons why carriers would want to work with them: It is difficult to aggregate many applications into a storefront; it will increase data plans — a subscriber might hesitate to buy a navigation application for $10 a month, but willing to download Google Maps and pay for data; and finally because someone else is building the store, it reduces the cost of acquiring a data subscriber.
– Carrier business model: When GetJar launches a storefront with a carrier, it will share some of its advertising revenue with the carrier. In this model, developers would pay for featured placement in the storefront, and then GetJar would give a percentage of that to the carrier, so not only does the carrier get data revenues from the app, but also an advertising revenue stream.
– WAP strategy: Since it’s difficult for consumers to browse the mobile Internet, GetJar helps WAP site developers by turning their site into a downloadable application. Consumers then download the application from the site, and it appears on their phone where other applications are. But when they click on the icon, it launches the browser and goes to the WAP site, creating a bookmark that people can come back to.