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Summary:

Though smartphone users compare the relative cost of their apps by their price, the better measure now that data caps are looming may be the cost of ownership which factors in data usage, argues the maker of a news aggregation app.

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Right now, smartphone users compare the relative cost of their apps by their price, a reasonable measure. But with data caps looming and unlimited plans fading away, the better measure would be total cost of ownership, which factors in not only price, but more importantly, data usage, suggests InkWire, which makes a news aggregator app.

The company did an analysis comparing the total cost of ownership between individual publisher apps and aggregation apps like Reeder, Pulse and Yahoo. Surprise: InkWire, which has a vested interest in this study, found that it’s more economical to buy a reader app that pulls from various sources than hitting up single-source apps, even when aggregation apps initially cost more.

By looking at the average price of the apps amortized over 18 months, and then factoring in the average monthly cost of bandwidth for mobile users and the average amount of data usage per month (about 126 MB), InkWire found that the average data costs for an aggregator app were about $2.73 a month. Assuming that users visit multiple single-source publishing apps to get the same info they can find in one aggregator, the cost of reading apps dedicated to a single source was about $7.94 a month, based on InkWire’s modest assumption that one aggregating app can replace three single-source apps.

Again, InkWire obviously has something to gain from a study like this. And its assumption that people consume three times as much data by visiting an average of three single-source apps doesn’t necessarily compute in the real world. Just because I visit single publishers doesn’t mean I’ll use three times as much data as when using one aggregation app. Data usage might be higher for aggregation apps, for instance, because users can be more efficient consuming news from a news reader app, thus saving time but eating up more content and data during a session.

None of this was even worth much consideration when we had more unlimited plans. But as those fade away, there may be more emphasis on efficient apps that help us consume data with less impact on broadband caps. It’s not just reader applications that merit consideration, either. Any app that helps us stay under the new limits being imposed by carriers is worth paying attention to.

As I recently wrote, there are clear differences between how much various smartphone users consume in data on the different platforms. App makers and publishers may not have had to think about how efficient their product are, but increasingly, consumers may take that into account, especially if certain apps push them over their data caps. I’m not sure we’ll get to a point where users pay close attention to how much data each app they use consumes, as InkWire seems to be suggesting. But being thrifty with data could be a selling point for app makers, InkWire for one, as they look to draw attention in an increasingly competitive mobile software market.

  1. I agree entirely. The fact that people, and thus developers are now going to have incentives to make efficient apps is just what economists call “demand management”. Tiered prices, caps, etc. all have the effect of managing demand. I fully expect future app reviews in the app stores to include phrases like “great app, but a bit of a data hog”, and this will cost it a few stars outta 5.

    Up til now, simple apps like a weather app might be hitting the network for updates every hour. Does weather really need to be updated that frequently? This was a waste of our limited spectrum and system capacity. I welcome tiers and demand management.

    Similar app efficiency has also desired with respect to battery use. If an app is noticed by enough users to sap their battery quickly, it will get dinged in the ratings.

    Battery power, processor clock cycles, data traffic…all of these things are limited resources. They should be used in sensible ways.

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  2. I think app designers should think about how much data they consume, how fast of a connection they need and also if data is needed at all. I see many apps that could exist completely offline but they send data via the web for no real benefit for the consumer.

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  3. Content providers refuse to allow consumers to choose the resolution and bitrate at which they receive video content.
    Mobile only users are falsely being villified as bandwidth hogs when the reality is they have no other access to any type of wired service.
    Allowing all internet users to make the choice of how their media is served up to them would make caps totally unneccessary.
    Allowing cable cos to own content providers and stakes in cellular companies clearly has not worked to serve the best interest of the consumer. Should tens of millions of Americans be force fed content then tiered on bandwidth? No.
    Not everbody wants to look for wifi service ie be stuck staying in the airport in the vip lounge to watch dish networks free streaming as shown in their recent commercial.
    Alternate streaming bitrates is a far better solution for the millions of Americans who are unserved or underserved by broadband.

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