Both Google and Apple are committed to the phone as a software platform. This tidal wave pulls along several subsidiary industries -- -- smart phone chip manufacturers, telecoms, phone manufacturers, sim cards; and it will turn out the whole software industry. Google and Apple by their strategic direction and commitment have created a technological tsunami; like it or not, the existing software companies cannot swim against the tide. The good news is that new companies who see the strategic direction can harness it with breakthrough agile products that gain a foothold and market share in a fraction of the previous cost and time.
Google's and Apple’s strategic direction includes: ubiquitous phone computing and connectivity, cloud computing, and synchronization with PCs and Macintosh computers. So not only will the shrink wrap software companies have to adapt to PC apps they will also have to port to smart phones and provide synchronization. All apps come from the cloud, all data stored in the cloud, all PCs are synced, and smart phones are synced. Portability across computers and ‘on the street’ mobility are key features. Any computer can access the app and use synchronized and ( in some cases) real time collaborated data The same apps work on a PC or Mac and also on iPhones and Android phones.
The web site for serious business apps is called Google app marketplace --- https://www.google.com/enterprise/marketplace/home?marketId=0. The web site for the fun and games Google apps is: https://chrome.google.com/webstore?hl=en-US.
A parallel Apple Mac apps universe exists that is 7 times larger. The iPhone has of the order 350,000 apps, most of which are on their way to becoming Mac apps. IPhone and android app marketplace is expected to double next year to $38 billion -- -- most of this will be up drafted to Macs and PCs.
The cloud apps have a radically lower price point -- a beginner’s license typically free, professional license radically lower than shrink-wrapped software. This will further democratize the software business attracting a wider base of new users with novel software ideas.
The primary target here of Google and Apple is the consumer market, not the corporate market. They create value for the end user, consumer based software. They create high value with ease-of-use so compelling that is seeps bottom up into the corporate world. It’s better, quicker, and affordable -- winning first the guy on the street who won’t put up with 2nd rate corporate software.
Microsoft is going in the opposite direction, ‘up the food chain’ targeting Oracle, Salesforce, and IBM.
The easy availability of apps will bring a Renaissance in science, education, democracy, and literature. No longer will the G5 countries or the G20 industrial nations completely dominate the world's technology, science, art,... New companies with a more agile infrastructure will be more competitive than dinosaurs with shrink-wrapped expensive software. The new platform is much less expensive and companies can experiment with new ways of reaching customers and new infrastructure with small cost and small investment, quickly outpacing slow-moving industrial software infrastructure.
This is a new renaissance for entrepreneurs. The startup cost for a new app is orders of magnitude less than shrink-wrapped software. Also, there is an instant platform and a crowd sourcing mechanism that percolates the best ideas to the top automatically as a function of downloads and reputation. Say ‘goodbye’ to the three-piece marketing executive and high priced salesman; this is software done by social democracy with no middleman.
We will see new companies, new ideas, and new revenue streams. Paradigms like ‘cash cow’ will be anachronisms replaced by high-value low cost consumer based monetization.
Some shrink-wrapped companies will adapt (SalesForce, SAP, Quicken), most not ( IBM ), and some following but too late (Microsoft) . Microsoft is a ‘dollar short and an hour late’; starting its own late cumbersome cloud imitative and a marginalized windows phone 7 app market -- http://www.microsoft.com/windowsphone/en-us/apps/default.aspx . Only entrenched corporate customers will use this, but not for long.
The death rattle of slow-moving software companies will have several stages. The first victims will put their head in the ground and not provide easy-to-use PC apps. The second set of casualties will be caused by ignoring the smart phone platform in trying to survive purely with PC apps -- -- both will be required. The third set of casualties will be caused by ignoring collaboration and integration.
Socializing software apps and using crowd sourcing is inherent to the new paradigm -- -- ignore it and go the way of the dinosaurs. Also inherent is integration with both the cloud and the standard documents -- -- in Google's case there are Google documents, Google spreadsheets, Google power point etc.
Beside Google and Apple there are other minor league players here -- -- Firefox, Amazon, AT&T, Windows Phone 7 -- -- becoming a marginalized player is none other than Microsoft. A parallel app platform is Facebook which has the social platform built in. Currently most of the Facebook apps are games but Facebook’s strategic direction is as a social platform for software applications, they believe that most existing applications can be socialized. The socialization of software apps and shrink-wrapped software is a parallel strong strategic pull that will manifest over the next couple of years – it will both propel the companies that do it well and burry the companies that ignore it.
Google and Apple’s open app platform gives them a ‘first to see it’ huge strategic advantage. They each see hundreds of new app ideas each day and will be the first to see the new breakthrough idea that changes the landscape – and have the first chance to scale it up.
