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Summary:

When we think about the cost of a smartphone we look at the usual things — price of the phone and cost of the carrier services. This makes sense, but it doesn’t tell the whole story in the long run. Smartphones add a lot of value […]

LocationWhen we think about the cost of a smartphone we look at the usual things — price of the phone and cost of the carrier services. This makes sense, but it doesn’t tell the whole story in the long run. Smartphones add a lot of value for the consumer, with the ability to add programs with additional functionality. These apps extend the usefulness consumers can get from a smartphone and are, in large part, the driver behind the proliferation of app stores that have appeared.

GigaOM points to a recent study of apps that have location features. These features take advantage of smartphones that always know, either through GPS or tower locations, where the phone (and attached user) are located at a given moment. Programs can take that location and dish up useful and pertinent information to the user based on what is nearby. This is a growing segment of smartphone applications, and it makes sense to see how the cost of such apps compares on different platforms.

The study shows that the average cost of an app on the iPhone with location features costs just $3.60. Compare this average cost with $13.60 on the BlackBerry, and you realize that the cost of the BlackBerry over time can be much higher than that of the iPhone. The study also shows there are many more location-based apps available for the iPhone than for the BlackBerry, which further increases the potential value of the iPhone.

  1. Okay, this seems like the kind of study where someone was sitting around after a bottle of wine, shared one anecdotal story and out came a “study”. I have a BlackBerry Bold and have 7 LBS apps, all of which cost me $0.00. Plus, to then go on and say “there are many more location-based apps available for the iPhone than for the BlackBerry which further increases the potential value of the iPhone” makes no sense. If there are more apps, even if they cost less, when you buy more of them you spend more money. It’s like buying something just because it’s on sale, you’re still buying it and spending money.

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  2. Yay for my G1 and Androids plethora of free location-based apps.

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  3. The real question is how many applications remain on the phone after purchase?

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  4. The notion that the sheer number of apps and their average price means anything is ridiculous. I own a blackberry curve (waiting on the Pre :-) and have no less than three location-aware apps currently installed, all of which cost me $0, and one of which is a turn-by-turn navigation suite (how much does that cost on the iPhone again? oh, right, it doesn’t exist) that sprint included for free. Add in the ubiquitous google maps and the preloaded blackberry maps and the my NEEDS are satisfied more than adequately. I don’t think all iPhone owners could say the same. Average price and total number of apps matter not… quality and functionality are all that matter.

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  5. Actually, it was a report by Skyhook Wireless, the company the provides Wi-Fi/cell tower/GPS location services. They did a survey of all of the location aware software in the three app stores. Their report can be found here (Be aware, it is a PDF): http://www.locationrevolution.com/stats/skyhookaprilreport.pdf

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  6. A lot of Apple bias comes out on this site. I still get all the updates because there’s some very good info in there too.
    Anyway the average price of an app is easily explained by the market segments of Apple and Blackberry. The Blackberry market is dominated by business users. The average prices, average app quality, and average app purpose will be different for the two markets. The number of apps is also no comparison unless you take quality and uses into account.

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  7. Was there any question whether BlackBerry apps would cost more on average? Aside from free apps, their lowest price on apps is $2.99, so there’s a premium to be paid regardless. That said, the sheer volume of iPhone apps and the ease of buying via iTunes (an indisputable sales powerhouse) means an iPhone owner is likely to spend more on apps overall.

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  8. Sounds a little biased… no offense

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  9. There might be more Apps for the iPhone, but I see many of them kind of the same thing. All the programs in my BB Storm didn’t cost me anything, they where available free.

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