by Tom Kaneshige

Future iPhone and iPad Apps: Smart, Engaging and Maybe Costly

Jan 24, 2011
Consumer ElectronicsiPhoneSmartphones

Mobile apps are maturing quickly as developers get more sophisticated, take dead aim at tablets, and find new ways of making money, says a new survey.

Goodbye, $.99 iPhone apps.

Apps with a cheap, one-time cost will be replaced by apps that bring in advertising dollars or drive recurring revenue based on usage or a subscription fee. This is just one of many findings released today from a survey of 2,235 mobile app developers, jointly conducted by app development platform vendor Appcelerator and market researcher IDC.

“Developers are shifting away from free brand affinity apps and becoming less reliant on $.99 app sales,” the report says.


In fact, mobile app developers are weighing seven business models, the most prevalent still being app store sales with 59 percent of respondents using this model. Other models include advertising (43 percent), in-app purchase (42 percent), brand loyalty and engagement (34 percent), mobile commerce (26 percent), subscription (26 percent), and coupons and loyalty programs (10 percent).

By far, the fastest growing business model is mobile commerce. In a similar survey last year, only 14 percent of mobile app developers had mobile commerce as part of their business model mix. Today, one out of four have mobile commerce, a growth of 86 percent.

Apps are also maturing and becoming more complex, evolving from simple content-based apps to apps that make use of location, social and cloud services to transactional apps that tap the power of mobile commerce, according to the study.

“As the customer experience evolves, so does application sophistication, customer expectations, business transformation opportunities and the underlying business models,” the study concludes.

On the tablet front, the survey found that Androids and, to a lesser degree, the BlackBerry PlayBook are gaining mindshare among developers at a faster rate than the market-making iPad.

Seventy-four percent of respondents said they are “very interested” in developing for Android tablets, up from 62 percent last year. Twenty-eight percent are eyeing the BlackBerry PlayBook, up from 16 percent last year. The iPad leads with 87 percent, only a 3 percent increase from last year. Web OS tablet interest remained flat.

So who is going to host these Android apps? The survey found that 82 percent of respondents are interested in distributing their apps via the Android market, 37 percent in Amazon’s new Android Appstore, 13 percent on Verizon VCAST, and 9 percent on GetJar.

The survey’s bullish Android results, however, could have been affected by the Android tablet hype at this year’s CES in Las Vegas. More than 85 Android tablets stole the show, and Appcelerator and IDC surveyed mobile app developers only a week after CES.

All tallied, this year mobile app developers plan to triple their app development efforts, according to the study. The average app developer will build for four different devices, a two-fold increase from the year prior. The top device continues to be the iPhone, with 92 percent of mobile app developers “very interested” in developing for the iconic phone.

The iPhone is followed closely by the Android phone (87 percent), iPad (87 percent) and Android tablet (74 percent). After the big four, the drop off is severe with the BlackBerry phone (38 percent), Windows Phone 7 (36 percent) and BlackBerry PlayBook (28 percent).

Tom Kaneshige covers Apple and Networking for Follow Tom on Twitter @kaneshige. Follow everything from on Twitter @CIOonline. Email Tom at