Ok, so were finally getting down to it. On at least two fronts, Apple has now essentially thrown out its draconian rules on what developers can and cannot do on its platform, and replaced them with essentially, no rules. The new “rules” appear to be, “its OK to do what you want in your app if we say so. And we’ll figure that out *after* you’ve fully invested in our platform.” In other words, you serve at the pleasure of the queen.
Now the truth is for the vast majority of app developers this is totally fine. People developing the uninspiring apps that mainly make up the App Store have nothing to fear. But those creative few that want to do something interesting with a UI, or want to use hardware in a new way, or who want to use a more advanced code execution technique are at grave risk.
For now, I will leave it to others to debate the impact of this strategy. I want to explore something different.
What is motivating Apple?
Apple claims its goal with all these rules is to keep out bad applications. But if that is the case, they are failing miserably because a lot of apps in the App Store, perhaps the majority, are total crap. Their stated rationale is, I believe, baloney. In fact, not only do I think Apple couldn’t care less about whether apps are crap, I think they *love* the crap, and that their goal is in fact to keep out the awesome.
I know this sounds over the top. Let me explain.
I think Apple is fearful of any truly ground breaking stuff coming from a third party. Apple does not really want even a handful of awe inspiring market moving 3rd party apps. They want hundreds of thousands of decent or even mediocre or crappy apps. The rationale for this thinking is actually pretty reasonable. Its great to be able to claim having more apps than any other platform. Numeric superiority is a huge marketing tool. No one cares if your tens of thousands of apps are mainly crap.
And yet, in the history of computing, we know that its not the number of apps that make a platform, but the existence of “killer apps.” Whether it was VisiCalc, or Lotus 123, or PageMaker, or Microsoft Office, the truth is users don’t really want hundreds of apps, they want one or a small number that are really meaningful.
The good news about killer apps for platform vendors is that they can drive the platform into the stratosphere. This is certainly great for early stage platforms like the Mac with PageMaker in the 80’s, or even with Facebook and Farmville in the last several years. But as platforms mature, Killer apps from third party companies pose more risk.
I think Apple has come to the conclusion that any killer apps for the iPhone need to be from Apple, and that those that are not from Apple are hugely dangerous. And this well may be true. Because if some third party invents something that fundamentally changes what it means to own a mobile device, and that software is available on other devices, overnight Apple is in the position of being the supplicant.
If that killer app vendor decides to support Android more effectively than they support Apple, or if for some reason they decided to drop the iPhone, that one vendor could have a devastating effect on Apple’s position in the marketplace. This is the position that Apple was in with Adobe in the 90’s and Jobs has made it clear he is fearful of ever being in that position again. Others have discussed this but it is usually framed in the context of why Apple doesn’t want Adobe on its platform. But I think the broader issue is they don’t want *any* companies generating hundreds of millions of dollars through some new mobile technology which Apple doesn’t control.
The greatest support for my thesis is that there are not yet any third party companies that have made a huge amount of money on the iPhone. Has there been success? Yes. Has there been enough to support a major exit, or to even put someone on that trajectory? No. And I think Apple will work hard, through whatever rule changes and market behavior is necessary to guarantee that that never happens, at least with any non-vertical technology.
So I guess the question here is what to make of all of this. And I think the answer is clear. If your goal is to build a major company, iOS is probably not the place to make that investment. Certainly it may be a great place for an entrepreneur who wants to build a lifestyle business, though even there risks abound. And for games I think the iPhone is fine platform since games are probably not strategic. But for anyone else, either entrepreneur or investor, who aspires to build a truly market moving mobile company, I strongly suggest you think different. Apple isn’t the only game in town, and as I have written previously, I don’t think it will even be the biggest game in town much longer.