App Stores: winner-take-all markets dominated by rich countries


#1

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#2

At least in case of video game this is mainly due to discoverability problem. Players need to be able to discover your game in billions upon billions of games out there. Companies need to invest heavily in marketing of their games. This is known as user acquisition. The catch is you need to make a bet of a huge initial investment, buying a lot of users until your app/game starts making enough money on its own so you can start paying off for initial investment and at the same time be spending on new acquisitions.

The price of acquisition per user is going sky high and only very few companies can afford it at the moment. It is a vicious cycle as this behaviour inevitably pushes the cost even higher making the pool of companies that can successfully compete ever smaller. These companies tend to be based in US, couple of EU countries, Japan or China. Everyone else is simply lost in the noise.

The scene has been static for quite some time but this doesn’t mean it will necessarily remain static. Freemium games command the lion’s share of revenue in app stores but huge chunk of this revenue needs to be channeled back into user acquisition. As prices rise profit margins shrink and this might become unsustainable for even medium size companies.


#3

Call me a Luddite but I’ve never understood apps.
Google proved 10 years ago with Gmail that the web can handle anything.
99% of the time, there’s zero inherent value in an app.

Hopefully it’s only a matter of time until Apple has (another) emperor-has-no-clothes moment, and the app stores die a quick and painful death.

Someone prove me wrong please.


#4

I love Apple products, but Lord does their App Store interface suck. Their “Similar” hits are rarely good, there are a tiny amount of usable filters (See Amazon or eBay for better examples), and their “infinite” scrolling in categories stops at 200.

At least there are still great curated blogs like Touch Arcade.


#5

With a desktop CPU, Google proved you could run an email client in a browser. The performance is quite acceptable nowadays after the development of improved javascript engines and a lot of work under the hood. But for anything graphics heavy a browser is still slow. And even the latest ARM cpus are nothing like a desktop CPU - for one thing they have only an average of around a watt to play with. Apple’s advantage lies in its native apps being in compiled code; Android apps are less cpu-efficient which is why Android phones require more memory and bigger batteries.

So the answer is that after a few more iterations, if Moore’s Law doesn’t die on us completely, the browser will replace most apps. But faster cpus will make it possible to translate heavier weight applications to phones, and so there will always be an advantage for apps at the high end. This was one driver of big screens - they were necessary to run the applications made possible by faster cpus and more memory, and the bigger surface area allowed for the power dissipation of larger batteries.


#6

It’s mainly a thing of convenience. People buy a new shiny phone. Perhaps their old one got crashed, perhaps they have fallen for the ad message, or they have seen phones their friends have. Anyway, you got a new phone and you want to actually use it. Sure you can go to your browser to check your mail, but there is this thing called app store sitting pretty on your home screen and it guides you to all sorts of app you might wanna install. One thing relies on your memory and habits, other thing holds your hand from the first moment in this strange new world… Either works fine, just app store way seems easier to a lot of people.


#7

you’re getting me started down the rabbit hole again.

pro:

  • convenient for pre-installed apps on new hardware

cons:

  • inconvenient to search app market
  • wait for app to download
  • worry about OS / hardware / feature compatibility
  • install updates that break features, cause data loss
  • throwing away perfectly good hardware after a year or two, at significant cost
  • anti-open source
  • fundamentally breaks the web

#8

Yes, I sure hope you are right.

App stores are the new AOL Keywords, and they deserve to die.


#9

Ummm… aren’t the rich countries where the money are?

Well… duh?


#10

The one obnoxious slice of the ‘app’ market to remember is the ones that are almost entirely ‘web apps’, just implemented via WKWebView or equivalent, rather than as a web page.

I’m not entirely sure why these even exist, how many of them just because the company wanted to have ‘an app’ because all the cool kids do, how many do require some platform-native feature in addition to the almost-entirely-a-web-page interface, how many just want the additional user data they can get by being an ‘app’ rather than a web page; but this wretched category generally wouldn’t even require performance improvements to be viable as a normal site; they just petulantly refuse to be one.


#11

Presumably poor countries are where the cheap labor is, though, so the import/export balance between wealthy and poor countries is somewhat interesting. The fact that ‘apps’ that mostly seek to grab user info for marketing purposes prefer people with enough money to be worth forcing ads on isn’t a huge surprise; but the fact that most of the winning ones are built in places where software engineering talent is expensive is somewhat less immediately obvious.

I’d be inclined to suspect that doing good localization is harder and more expensive than it looks; and that some markets are a lot more willing(and practiced) in just sucking it up and computing in en-us if they want decent production values, so localization is only obligatory for some cases.


#12

I think the idea of app stores dying a “quick/painful death” has put out to sea a long time ago. That doesn’t mean that App stores are ideal in every case, as they have been/are/still could be mismanaged at times, but app stores are largely a successful idea.

I use some painting/drawing apps. There’s no way a browser is good enough for that. I also live in a rural location where cell coverage isn’t always feasible, so an app is definitely preferable for those times.

I do see what people say about a lot of apps just being sort of redundant. Social media apps being one of these, I think. News sites might be another.

Edited to add:

Why do they deserve to die? Why shouldn’t they just be fixed?


#13

The “winner-take-all” phenomena is real but is also pretty much an inevitable outcome of globalization.

The fact that any of you know Cory at all is an illustration of this. In a less connected culture, Cory’s communication/influence circle would be confined to Toronto, or perhaps Canada as he found a Canadian publisher.

Instead, he’s used globalization and the Internet to establish himself as a world-wide phenomena. Instead of there being dozens of local, slightly-successful “Corys”, there’s just one massive winner, Cory Doctorow.

Which is a long-winded way of saying that “winner-take-all” has its upsides - without that, most of us would never have the opportunity to enjoy the highest quality winners such as Cory.


#14

#EatTheRich


#15

Hey, I’m not saying you are wrong. Just telling why so many people chose apps.


#16

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