As a society we tend to think that more is better. More megapixels must result in better photos. More square footage must mean a better apartment. More calories must mean a more delicious meal. Often times--save the last--we are wrong. As a recent dizzying foray into the Apple app store recently demonstrated--more isn't always better. So as the apps arms race accelerates a poignant question emerges: What if less is not only more but a competitive differentiator?
Apple's and Android's competitors have or are poised to release updated operating systems that will redefine their role in the market. Research in Motion just launched BlackBerry OS 6. Microsoft is weeks from the release of Windows Phone 7. It is fair to expect that webOS 2 is en route with new hardware in tow. Carriers are building and rebuilding their own app stores as well. As these platforms hurtle towards market it is fair for their creators to get caught up in the apps arms race. But doing so would be a mistake.
Imagine if you will, entering a Best Buy. A mid-sized Best Buy store in the United States is 30,000 square feet--according to their website. If apps came in average size software boxes it would take 95,500 boxes to fill the entire floor of a Best Buy. Apple now has 250,000 apps--which is the entire floor covered nearly half a foot high with a single copy of each app's "packaging." Good luck trying to find something new there. At 4 million applications the boxes would be six feet high. Now 4 million apps may seem like an unfathomable amount--but didn't 250,000 feel the same two years ago?
One tenet of market research is to never use yourself as a proxy for the mass market. Being a rabble rouser that loves flouting the sacrosanct beliefs of my industry I will briefly do just that. Personally I have downloaded a handful of go-to games and rely heavily on even fewer applications that regularly make my life easier: Yelp, OpenTable, Evernote, Tweet Deck, Tumblr, Netflix. These are my go-to applications and they fulfill my entertainment, shopping, information, eating, and productivity needs. Survey data seems to indicate that others have a similar phenomenon relying on a limited number of the apps they download. A more tired and true medium also bears this out as studies indicate viewers only watch a handful of television channels regularly despite the options available.
But I, and many others like me, have found apps that meet their needs despite the ever widening app store--so why must a change take place? Because the virtual store shelves continue to pile up making buying decisions increasingly difficult. Thanks to Barry Schwartz we have a name for the phenomenon--the paradox of choice--a notion that posits that fewer choices make people buying easier and people happier with their buying decisions. Apple is starting to address this phenomenon by telling developers, amongst other things, that they "don't need any more fart applications."
In fact, a great deal of app discovery seems driven by the Top 10 applications lists which creates a cyclical self fulfilling prophecy of success. An app makes the Top 10, is seen by others, sales drive upwards, and the app remains in the Top 10 in a never-ending cycle. Over the past five months I have created a database for Strategy Analytics which includes the top app data for the U.S. Apple (and BlackBerry whose data is not included in this piece) store. Over the last eight weeks there have been 80 "slots" for top applications in Apple's Top 10 paid apps list (10 per week for eight weeks). Out of those 80 slots, 43 applications have appeared. What this means is that about half of applications remains steady week to week. In those eight weeks three applications--Angry Birds, Fruit Ninja and Doodle Jump--have appeared every week. Only 25 applications--less than one-third of total apps--appeared only once.
The top grossing apps tell a similar story. Out of 80 slots even fewer--36--were occupied by different applications. Only 18 apps appeared one time each. While six appeared five time or more.
In a vacuum it is difficult to decipher what all this means. Recently, I was playing a little app store volume Sudoku to decipher the relative volume of applications and from what I was able to determine the 10th application does about 25 percent the volume of the top application. Once you exceed the Top 50 you are below 10 percent of the top app volume. While this remains a significant number the volume shows that the Top 100 apps are moving the bulk of the volume. So, while the long tail remains important to building a catalogue hundreds of thousands of applications may be overkill.
So, what does this mean? What it means is a platform that has less applications can succeed if those applications are good enough to land in the Top 100 of any other platform and there is a nice collection of free apps mixed in. While competition breeds innovation forcing existing applications to improve the ceaseless addition of new apps only leads to the paradox of choice.
If platforms want to succeed on a smaller developer base they should focus on the following:
- Create more useful app categories and ensure submissions match the category.
- Ensure new applications improve existing offerings by being cheaper, easier to use or more compelling.
- Create a way to retire applications that are not regularly updated, downloaded, or improved.
- Partner with major websites, services, and games to ensure big brands are properly represented when a platform launches; Facebook, Yelp, Foursquare, Netflix, Rovio (Angry Birds), TomTom, etc.
- Focus on applications that make a platform unique--for example Android and BlackBerry have PrimeTime2Go a subscription service that allows users to download top tier programming to their device for later playback.
Despite all this public perception will continue to judge app stores by the number of apps available so building a strong library remains important however ensuring the line between just enough and too many doesn't get crossed could lead a platform to victory in the apps arms race.
Josh Martin is a senior analyst for wireless media services in the Global Wireless Practice of Strategy Analytics.