Apps have become a common expression after the success of iPhone/iPod application system. Its become huge business on Apple devices and Google Android Marketplace. Recently Apple logged over 10 billion downloads through the App Store. Sure, lots of Apps are free, but the numbers are interesting.
What I find more interesting is how the apps really create its own echo system for both Apple and Google. Their own digital download channels, which they own and operate. And Apple owns both the Hardware, Sales/Distribution Channels, Software, and get 30% of all the revenue generated by sold Apps.
From a customer perspective its interesting to see how this affect which device (system) we choose. For example, I am a big Apple fan, owning an iPad, iPod, iPhone and an iMac. I purchase and download new apps all the time. Mostly games, and between 1 – 5 dollars. And now when I have invested so much money in apps through Apples system, I am very unlikely to change to the Google system, cause I would then have to purchase all the apps again. Even if the apps isn’t that expensive, I still have invested quite a lot of money in Apple Apps.
In some way customers is making a bigger decisions now when they have to purchase mobile devices. The Apps will be a heavier factor in the choice of which system to pick. Its interesting because Apps really adds value to the system and devices, so its in the interest of both Google and Apple to get the latest and best apps to their platform.
One of the two biggest websites online (the ohter being Facebook), Google have joined the fight against piracy. With tons of torrent and other piracy sites, they will of cause be listed in Google. This will probably be (as with most businesses online) the main source of new customers/users. And if you cut this source of new user, you might hit the pirates just right. So Google now works at making it easier for content and copy rights owners to “delist” piracy sites. This will probably quite a mighty blow toward the pirates. But at the same time you could question the sort of Openness philosophy Google have about listing everything online. The power of Google on the internet is needed to be discussed in details. So who better to make it harder than those guys? It will be interesting to follow up and see if it have made an effect.
But you can divide piracy into two categories, content ripping and distribution. Pirate Bay for example is only a distribution network enabling content rippers ( the ones who get hold of content to distribute). They don’t host or hold any files. Both categories are equally problems, but they enable each other. A simple concept. You have to have good content to attract more customers/users, but at the same time massive amounts of customers/users make it attractive to distribute into. You have to kill both content ripping and distribution to really crash piracy. Googles action will limit sending new users to the torrent/piracy sites. Not prevent the content from being ripped. But its a step in the right direction.
The other day I read about a new free program available (for free) online called OffiSync. A nice little program which enable you to connect your Google Docs account with Microsofts Office. So basically you can work on your computer in Word, you can save it up in the cloud to your Google Docs account. Which enable you to always access the document later, as long as you have internet access. Its such a basic feature, but yet so powerful! The ability to connect the most used offline and online office work package is really useful, and really good for customers.
This program was created by a third-party company, with the same name as the software. Ideally, the two IT giants would collaboration them self. Of cause they want every single person on the planet to ONLY use their software/solution. To own the customers, but sometimes collaboration is better, for the end consumer!
Collaboration,something that I think believe companies often forget, can benefit the end customers more then they can imagine. With all the new devices, operating systems, social platforms and new software programs, the connection between those and the ability to transfer files, documents, information and other media fast and easy between them.
DropBox is a cloud file saving service, were I can upload and store my files. Then I can access them any time either through any web browser or the DropBox client. Got introduced to this service through a business contact at work. She showed me how she used it to access all her work files on her iPad, without storing all files on the actual device. A true killer-app that made it possible for her to actually work with her iPad instead of caring around a heavy laptop. And the connection/integrations with the iPad apps is crucial for this to work. Now I use it all the time to send files from my work computer to the home computer, fast and easy.
Facebook Connect is a feature Facebook offer everyone to freely implement on their web sites / software and games. Take a web site for example: It enables users to “connect” their Facebook identity, friends and privacy to any site. Another example is StarCraft 2, or rather Battle.Net (its online network). It uses Facebook Connect for players to through their Facebook profil add friends to their Battle.net friends-list. I never had to know my friends Battle.net names or anything. Just connecting through Facebook and right away I had 20 friends on my Battle.net account! And their is so many more ways to utilize this feature.
With all the competition out there in the market today, I think its better to focus on, what gives value and improve any service for the CUSTOMER! I mean, I have a lots of account to different services and it would be great if I could connect them better. To collaborate instead of forcing your customers to limit them to your service. Sure it might be a good service, but by thinking more openly and see the potential in collaborating, it can become great!
Okey now that the biggest hype about Apples new product have cooled down, here are my thoughts. It was hard to noticed or know anything about it if, like me, you had didn’t watch the key note and wanted to see if with your own eyes. It seems that for each new product Apple announces the crowd who follow it live over the web increase. The day after the unveiling of the iPad, even our Swedish tv news reported about it. Even a gaming site like Kotaku had what seems like 10-15 post in a row about the iPad directly after or during the announcement.
It seems the reaction wasn’t that positive as previous product announcements, like the iPhone. It feels like people still try to figure out if they really need an iPad if they already own an iPhone, iPod and probably an Mac. Those mixed reaction is understandable, as the bigger Apple gets, the pressure increases on each new innovation to top the previous one. I think many just don’t think this announcement really cut it.
I watched the key note presentation, haven’t read that much about it (didn’t need to thanks to the web were everyone talks about it) and tried to feel inside what I think. And in the end… I probably want one! I am not completely clear on why I want one, or if I have a need for it. I would probably use it as a portable computer were I can do some basic work with as well as what movies and have all my contacts in. And I can accually see myself playing games on this one.
One of the big thing that people have been discussing is if this will be a real competitor for Nintendo DS and Sony PSP regarding the hand held game machine market. I think Apple have an advantage regarding their brand. Regular people know Apple better than Sony and Nintendo. On the other hand, the iPad isn’t that cheap. So the installbase will probably not be that big, to begin with at least. One of the best moves they made is that all iPhone / iPod Touch games works on the iPad.
Not as innovative or revolutionary as previous Apple products, but I still want one
One of the big thinks in technology and software business is Killer App. Usually for software or games it is that application or game that a reason why people invest in a bit of hardware. For example some consider Halo 3 or Gears of War as typical killer apps for the Xbox 360 once they came out. The game industry still talking and waiting for the killer app for Playstation 3 that will make sales of the console take off. Another old example is the spreadsheet for the early computers which transformed computers into efficient office tools.
The killer apps are those application that comes ones in a million, something that truly motivation why we should invest in say new hardware or machines. But with more and more application is created each year, in different forms, it’ll be harder and harder as with everything to breakthrough. With more devices and even more smaller application that becomes connected from start, maybe we’re into a change. Not were one “Killer app is king”, but the sum off all the mini-apps. Take the iPhone, that don’t have One application that makes people buy it, but some part the brand, and the other the sum of all the cool apps. And with the introduction Apple Apps, the mini-apps continue to increase. As does the motivation to buy the phone, since its one of the only phone with so many small application developers. I think people today want more than just one reason to buy a new device, they will look at the sum of the greatest applications.
First read about this on the Detective Marketing blog. A mindblowing presentation about a experement where they try widghen the senses. With just a couple of bucks almost anyone can buy and make those devices. Those new devices probably wont be out for commercial use for some years (or maybe they will be in one form or another).
But whats more interesting is what entrepenures and scientists will develop for new unthinkalbe uses. Better yet, in the hands of really creative game designers a new way of playing games will emerge. The possibilities are endless!
Its been a while since i took the time and watch some inspirational TED presentations. And last time I viewed the latest presentations one found my interest. Simply one word, Twitter spoke to me.
Twitter, a relative young service that created the expression Micro-blogging. Looking at the popularity of text messaging on cellphones and combined it with the blog technology, spawned a service and phenomenon now wildly adapted by many many people. I would like to see any numbers on how many Twitter accounts exist. Many view it as the next evolution or extension of regular blogs. And there are a big variety of different microblog services now. But Twitter is by far the biggest.
The speech by internet entrepreneur Evan Williams, one of the Twitter creators some points really struck me. He mention how Twitter have evolved and the users have found new ways to use the service than the creators ever though of. And I think one of the key for the success is how simple and open the service is. Twitter is very open for users to develop new services outside of the original platform. With an easy to use API, the users and fans get great tools to build new applications. Open API for new services becomes more and more important. Developers today are used to have access to great APIs for them to use their imagination.
This isn’t anything new. Facebook have received much attention from developers, companies and users for all the Application available. And I believe this will be even more important in the future, not to develop a complete service, but rather build the groundwork and then let the users develop it further. Maybe, not even have a clear image of that the service should be used for. Let the users decide what is should be used for or how. Its been showed time and time again, that users can come up with new ideas for a product, service or brand that the owner or creator never had in mind. But often (still) do the owner or creator hesitate to take advantage of those ideas and are very quick to send out their “assassins”, their lawyers.
Twitters openness are totally in line with the principle of the web, easy, accessible and open! Lets just hope more new services follow the same concept. But, in all cases the first thing is to have a killer app that people love and want to help develop further.
Its really an interesting time to be in the digital game distribution business right now. Many new developments are happening at the moment. Not just for games, but for all entertainment medias. iTunes, Spotify, Netflix, Playstation Network, Xbox Live and of cause Gamersgate. Consumer are adapting to the new way to get and consume media, althou owners and publishers aren’t alwasy as fast. More and more publishers are focusing more on digital distribution. Retail is still important to reach the mass market, but digital distribution becomes a strategic part of the overall strategy. One example is Capcom who really see the importance to lead when it comes to offer their games digitally. I also remember an article some time ago were the CEO of EA said that they expect to see an increase in revenue from selling digitally.
From a publisher point of view, one thing digital distribution can help counter is the big pre-owned market. Retail chains like GameStop make millions in profit on selling used games. They offer customers to sell their used games to Gamestop, who then sells the games to a new customer. And this second sale of the same game are usually to a much higher price then what they bought in the used game for. And the difference will straight into Gamestops pocket, and nothing back to the game publisher. Publishers only earn money on the first sales, all sales after the first goes to the retailer. Consumer are happy cause they get to buy new games cheaper, but to the industry as a whole it isn’t good. Recently Amazon declared they’re entering the pre-owned game market. A news that probably let to the big fall of Gamestops stock value. And Gamestops CEO didn’t hestitate to doom Amazons used game investment.
Even if those to big companies weigh war against each other over the used game market, the money generated here won’t return to the publisher and developers. This is probably one of the big reasons downloadable content (DLC) have expanded though out the industry. The possibility to expand the experience for the player, but also the extra one money for the publishers. Not only won’t the retailers get any part of the revenue from DLC, its also a way to fight piracy. Digital is definetly the way to go, here to stay and conquer.
In recent months, Spotify have been on many peoples lips around me. Music streaming services have come and gone, but I have never heard so much good reviews and word of mouth as Spotify. Not only developed in Sweden, but with a great working service and impressive content catalogue this one have all the possibilities to be a smash hit! Currently in Beta and Invite only, it seems everyone around me using and loving it. And already are people working to port the service to mobile phones.
Today a free music streaming service, and it seems the business model and revenue in the future will come from Premium-paying-customer and audio advertisement. Though many of us who use it wonder how they will make money. One thing is sure, and that goes for all new entertainment media services; without content no service will be used. And for Spotify to attract more users it needs even more music. Not only the music from the “big bad boys”, but all smaller to fill the Long Tail as well.
But once again, it seems the music industry won’t take risks or simply won’t people to discover and listen to new music. This is thanks to the fear from the big record labels, who want to limit the amount of songs offers in the service and forced Spotify to take down many songs and tracks. Once again its the lawyer who stands in the way of evolution of the music distribution media. Instead of taking a step forward the industry take a few back. The big companies still don’t seem to trust new platforms. Today I finished reading The Viking Manifesto, how we can learn business theories and ideas from the old Vikings. One chapter simply titled “Put lawyers last in the boat”, which means that lawyer (even how great and talented they are) often are counter-productive and often in the way of creativity.
I truly hope Spotify becomes a great hit! Not only cause its a Swedish company, but cause the music industry truly need a big push to cope with the incresing piracy. The CEO of Spotify Daniel Ek also believe the business model could work great for games as well. But this reqiures the game industry to adopt to the streaming model. I personaly thing the game industry is more keen on change than its older brother music. As newly appointed president of the United States, Barack Obama pushed into peoples mind, Change is emintent for surviual. Specially in the fast hardening media business. And that size and slow bureaucracy don’t always is the best move. Like the Vikings, even thou they were few they always adpoted and changed tactics to their advantage. Spotify have all those possibilites, but still rely on others for content and become the next iTunes hit.
It might be my current choice of reading, Wikinomics, which spawned the idea for me to write this post. A now “classical” book about the new changes the web have caused and contributed to over the last decade. One of the authors have been famous for been ahead of his time with his ideas, visions and visions [Video]. Now I’ve finally had the time and energy to truly read this great encyclopaedia(wikipdia!) and summary of new and fresh ideas, thoughts and collaborations. Full with great examples and explanations on the behind factors for some of those success. Its really a must read! Today these ideas may not seem so revolutionary. yet many businesses and companies sure could need some help adapting to the new changes, challenges and opportunities waiting. Like the game industry…
At the moment I consider buying a Playstation Portable (PSP). It was used as an example in the book on how users want to modify their technological machines, while the hardware manufacture doesn’t and try to stop them. There are tons of great example on devices the user and fans have improved and developed new software, uses and done truly remarkable things with, some even beyond the creators own fantasy. And yet many manufactures constantly work against those who simply want to improve the product. Their afraid that people will “hack” the product, that could result in companies lose sales beyond the hardware, revenue and control. That’s the general assumption it seems. But as with most things, they should try to see the new positive effects instead of the negative ones.
A great example is the game console platforms. If you study all the big game consoles on the market (not including the PC platform) they’re all tightly locked systems. Video game consoles have been described to go in “hardware cycles”, were a new generation enters the market about every 5 years. And the industry also talk about the estimated console lifespan, how many years a consoles lives (=how many years new games continue to be released for the platform). According to the CEO and President of THQ Brian Ferrell, the industry have more sub-cycles today. And claim the traditional Hardware-cycle model to be “dead”. Along with the growth and expansion of the game industry, the segmentation have become more diverse (sub-cycles). A good thing, thou not totally without complications. In today’s market this works, but how good is it for the future?
The point I aim for is this, manufactures should open up their platforms and system more! Mass collaboration for a future prof content platform. Some new games/programs touch this concept of user-generated content like Little Big Planet and Xbox XNA offering the users tools to develop their own games. That’s fine for now, the problem I see is those games are still locked within the console-owners (read Nintendo, Sony and Microsoft = the Big Three) controlled platform. I’ve earlier discussed the problem with Locked exclusice online content. This goes beyond just content. It may be good for now to offer easy tools for user to create their own content and share them with others over the closed network. But to truly create a attractive future platform, the Big Three should open up even more. This could allow the users and community to freely develop new applications, features and harness the power of the consoles and networks. Winning with an Open platform!
“Conventional wisdom says that being open is rather like inviting your competitor into your home only to have them steal your lunch. But in an economy where innovation is fast, fluid, and distributed, conventional wisdom is being challenged.
Winning in a world of cocreation and combinatorial innovation is all about building a loyal base of innovators that make your ecosystem stronger, more dynamic, and more expedient than the ecosystems of rivals in creating new value for costumers. To achieve this, your organization-regardless of the sector of live of business-needs to identify and open up platforms to enable mass collaboration.”
– Don Tapscott and Anthony D. Williams, Wikinomics.
To some extent can I understand the dilemma for the Big Three. They want control so their network, hardware and services isn’t abused. At the same time as they have a responsibility for to offer their costumer a reliable and stable service. And of cause, they want to make as much money as possible! But the price they pay is loosing innovative knowledge and possible free work force from the collective intelligence masses. Its also understandable they don’t want to experience the video game crash of 1983 again. We can assume the industry have learned from their past mistakes! Instead it could speed up the overall progress of the harnessing hardware capacity, software innovations and selection of game available. If you make a search on Youtube or Google Video, you’ll find many many videos were people have modified gaming consoles and created new fascinating applications. And that’s probably without access to SDKs from the manufactures! Imagine what people could create if they had better access to system tools and a developer community hosted and encouragement from the console owner. Building new functions and and applications for their machines, creating more new value for the platform. With army’s of fanboys and fangirls out there, and many with good technical experience and knowledge, what are the the Big Three waiting for?
“A key message in this book (Wikinomics) is that the old monolithic multinational that creates value in a closed hierarchical fashion is dead. Winning companies today have open and porous boundaries and compete by reaching outside their walls to harness external knowledge, resources, and capabilities. Even the stodgy, capital-intensive manufacturing industries are no exception to this rule. Indeed, there is no part of the economy where this opening and blurring of corporate boundaries has more revolutionary potential.”
– Don Tapscott and Anthony D. Williams, Wikinomics.
Which bring us to the PC (including Mac and Linux of cause) platform… Since the beginning the PC have been open for everyone to develop on. No one owns the PC, the open source philosophy is basically built in from scratch. There are no limitations on the PC, if you ignore the hardware side that is. A PC is never finished in the same since as as console, even if there are different SKUEs and new firmware constantly released. The never ending upgrading of PC hardware is both one of its strongest features, and the weakest. One PC are almost never exactly the same as another. This create a endless variety of configurations, all that PC games have to be tested against. Another big factor in the PC community is MODS. Game developers release their code and encourage other to improve, expand or build completely new games! A phenomenon with deep roots in the PC community, and have spawned many big successes and been the breakthrough for many small developers. Microsoft try to work this into the Xbox with their XNA, and it could be fine if it weren’t for the distribution. Developers can’t simply create a game and release it, they have to receive approval from Microsoft and are locked within the Xbox Live network. One area I won’t go into discuss this time is Piracy.
There’s also the question of how future prof the current game generation is? One problem with consoles vs. the PC, is that consoles almost never are automatic backwards compatable. Whether I can take a 10+ old PC game and pop it into my new PC system and it still runs (the only bottleneck nowadays is comparability problems with Windows Vista 64-bit, thanks for that Microsoft!). But I can’t play my Nintendo games on Super Nintendo console, unless there is a adapter to fix this. Many of the current generation consoles start to work out ways to revive old games, by releasing them again and therefore charge for them again! Not future prof or backwards compatible in my view.
I thought this through today when I went home from work, how would I build a game console to fit this new paradigm? When it hit me, that the console already exist, the PC. It still have its limits, but its open. A future gaming console that is an empty shell basically and then let the game community develop the software and upgrade the hardware to fit their need, and explore how far they can push the console. Have trust in the community, and let them show the way to the future. With a young industry as the game business is, how it works today is fine, for now. But in the future when hardware power won’t matter as much as today, the real winner will be the one opening their platform and working with a good community. Why not start today!? They have everything to win.