Verizon to Open App Store- Nobody Wins
GigaOM broke the news that Verizon plans to open its own app store for all the smartphones on its network. The Verizon store will carry apps for the RIM BlackBerry and Windows Mobile, as the carrier currently sells phones from both of those handset makers. Verizon is expected to carry Android phones and the Palm Pre eventually, so those platforms would likely get covered in the Verizon store, too. The carrier feels that the inclusion of its app store on all of the handsets it carries will make it easier for customers to find the apps they need, but I have to ask, why?
Those smartphone platforms already have their own app stores, which makes perfect sense. What could be easier for BlackBerry owners than to visit the BlackBerry App World to find a needed program? The App World is the only place to find the BlackBerry apps after all — at least it used to be. Now Verizon BlackBerry owners will have to visit the Verizon store, which will be stocked with apps for all of the covered platforms. That means that developers of BlackBerry apps will have to get their program certified for sale and admitted to two different app stores. Want to bet they don’t all do that?
Verizon told GigaOM that the platform app stores will not be installed on handsets sold by Verizon — only the carrier’s store will be installed. That means that customers may not see all available applications for a given platform, only the ones submitted to the Verizon store. Sure, it said that customers can download and install the original app store themselves if they wish. Talk about confusing; customers who do that will then have two app stores on the phone that they must check. While some will like that apps purchased from the Verizon store are billed to their phone account, others won’t mind paying for apps the way they always have. The convenience is overshadowed by the clumsiness the second app store inserts into the process.
Long term, Verizon customers who purchase phone apps through the new app store will find they are locked into the carrier. Let’s say the BlackBerry owner buys an app from the Verizon app store. Down the road, the customer switches carriers. Now he can’t prove he owns the app purchased through Verizon – they have been removed from the picture. He may have to purchase the app again through the “official” platform app store, just to prove ownership.
Developers don’t seem to gain much from the Verizon app store on the surface. They are already submitting their programs to the platform app store for sale. That won’t change if they want to reach every customer on that platform. Having a second Verizon store doesn’t broaden their market; it only represents a fraction of said market. It’s not clear what will drive them to want their program available in the Verizon app store. If customers don’t get much benefit, and developers don’t seem to either, who wins? It sounds like only Verizon.
Related research and analysis from GigaOM Pro:
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I have to admit that it is more confusing than helpful.
It’s absurd for a carrier to do this. Leave it to the OS platform vendor.
Sounds like the telcos feel left out and want some of that green. This is nothing short of corporate greed of the highest order. The lack of innovation in the smartphone space is mind boggling, all i see is every vendor simply trying desperately to COPY Apple’s every move. It’s time for these telcos and the other smartphone makers to start thinning their herds and get rid of all those brain-dead-monkies working in upper management.
I don’t know if it’s fair to say that they are copying Apple. 3UK have always offered their own app store and, from memory, other phone companies that I’ve dealt with have too. In fact, I’m surprised that Verizon is the first to do this in the US.
I agree that they this allows the phone companies to make a profit on all application sales but it also lets them control what applications get through. That means that you won’t have access to anything that competes with the phone company, makes use of services that they would prefer you don’t use or that they just don’t approve of.
Very good point, Jake. It gives Verizon the control over VoIP apps, for example. At least in this instance we’ll still have the platform app store.
This analysis simply isn’t correct. Using BlackBerry App World on a RIM device is by no means ‘easy’ and is definitely not the only source of BlackBerry Apps. What about Handango, Handango InHand, and developer websites? An alternate look at the current app situation for BlackBerries:
http://blog.endeavourpartners.net/2009/07/08/blackberry-app-world-no-news-is-not-good-news/
Yep, AndyT’s got it.
Verizon wants paid. If I recall phone add-ons like ringtones are extremely profitable for phone companies, and this opens up a whole new (functional) segment of the market for them.
Verizon has had Get It Now on their dumbphone line for years. They’ve also had a smartphone app store for some time now.
Verizon has always been in the app game. The fact that they want to push is further shouldn’t surprise anyone.
Its a dumb, greedy, and short sighted move by Verizon that in the long run will end up hurting them more than helping them. It is in their long term interest to have a vibrant ecoystem (buzzword!) around their phones if they ever hope to compete with the iPhone. Never underestimate the greed, stupidity and customer hostility of any Tlco.
I don’t much care what Verizon does though since I have an iPhone. Even if i had a Verizon BB most BB apps are garbage and that goes double for Windows Mobile. But if Verizon gets the Pre and if the Pre gets a decent development environment this will really hurt. Same with Android phones.
In fact, Verizon was the first entity in the US (carrier, manufacturer, content aggregator) to offer a comprehensive, all-inclusive app store with proper billing, subscription, developer revenue-sharing, etc..
Their BREW-based GetItNow store has been shipping on every non-smartphone handset on their network since 2001-2002.
AT&T and Sprint (and T-Mobile, barely…) also have been offering their own app stores for years.. so in this sense, the carriers are the incumbents in the app store space and the manufacturers are the newcomers.
Now, which stores offer better user experiences and choice for consumers is a completely different topic….
James, thanks for covering this. I’ll definitely be factoring this in to the smartphone purchase I intend to make next month.