Google, Apple, and App Industry Competition

While the magic of apps is simple and elegant offerings that consumers enjoy, hidden from view is a complex web of intertwined co-dependent parties that the Alliance calls “the app ecosystem.” In order to succeed and convert an idea into a business, app developers and publishers rely on many ecosystem partners, including high-quality operating systems and devices, and providers of analytics, advertising and marketing services.  

For two years the Alliance App Strategy Workshops have explored many of these complex relationships, and helped buyers and sellers efficiently recognize partnership opportunities and risks. Often we program competitors together on panels, and the discussions provide Workshop attendees with very clear understanding of competitors’ offerings, their differences, and their respective advantages. 

For developers and publishers, competition between apps is a constant motivator to improve, innovate, and accelerate. Similarly, competition among ecosystem partners motivates them to improve and innovate – and always try to deliver new benefits to app publishers that ultimately benefit consumers also. 

This week’s app industry news is all about operating system competition – an area that developers and publishers know well. Many developers’ and publishers’ first mobile OS allegiance was to iOS – the groundbreaking foundation of iPhones and iPads that literally launched an industry. In contrast, early Android-based devices were challenging to developers, as the flexibility Android offered manufacturers resulted in apps being treated differently by different devices. 

Fortunately Google and its device partners heard the cries of frustrated app publishers that were spending too much money making sure their apps worked equally well on Samsung, LG, Sony, and other devices. The platform partners worked to improve uniformity, and their progress substantially eased the process of coding apps for Android devices. The result is more apps developed by more publishers, and more choices for consumers. For developers and publishers it was also significant that Android and Google really promoted the advertiser-supported business model, which created opportunities for thousands of developers to launch new apps and find their audiences.

In the near future, the mobile app ecosystem might have several more strong operating systems, as Windows Mobile, Tizen and Firefox are well-funded and motivated to succeed. These operating systems are challenging one another to innovate faster and better, thereby enhancing their appeal to app developers, device manufacturers, and consumers.  

The world’s short digital business history documents that markets are fickle and today’s winners are often tomorrow’s trailers. Many in the tech industry remember Microsoft’s dominant browser, AOL’s extraordinary market share, our first Palm Pilot and our Blackberrys that followed.  At the Alliance, where developers come first, we hope that operating system and app ecosystem competition continues to be aggressive and even cut-throat, because competition delivers great benefits to our industry and ultimately to consumers.

Keir Hutton Ferris

Director of EU Membership