T-Mobile USA hangs up on Partner Network program

Less than two years after launching its Partner Network developer support program, T-Mobile USA is shuttering the initiative and will no longer accept application and website submissions. In an email distributed last week to Partner Network members, T-Mobile USA said "With the mobile space being an ever-changing, dynamic industry our decision to close this program was not taken lightly, but we feel reflects our commitment to support the growing ecosystem of partner storefronts and non-traditional paths to market." The operator adds the Partner Network website will continue to exist as a portal to developer tools: "Whether it is resources in our partner hubs and service provider sections or the ability to tell us about your application for featured placement, the Partner Network team is here to ensure that you have everything you need to successfully grow your business with T-Mobile." In the absence of the Partner Network effort, T-Mobile USA instructs developers to upload their efforts to platform-specific storefronts like Google's Android Market, Research In Motion's BlackBerry App World and Microsoft's Windows Phone Marketplace--the carrier also suggests collaborating with content aggregator partners Cellmania and the Wireless Developer Agency to secure placement in its web2go storefront.

T-Mobile USA unveiled the Partner Network program during a dramatically different time in the wireless industry's evolution. With Apple's App Store just a few months old and Google's Android Market not yet open, T-Mobile promised developers something radical--a platform to market their apps directly via the carrier deck, along with the flexibility to determine their own premium prices. Because T-Mobile did not respond to a request for additional comment, it's impossible to identify precisely how, when and why the Partner Network went off-course. Whatever the reasons behind the carrier's decision, waning subscriber interest in applications clearly isn't the culprit--ABI Research forecasts mobile app downloads will close in on the 6 billion mark in 2010, up from 2.4 billion a year ago. In addition, the research firm expects Android app downloads will exceed 800 million this year--T-Mobile, with multiple Android smartphones in its portfolio, looms as a major beneficiary of that growth.

The answers likely lie in what T-Mobile describes as "the growing ecosystem of partner storefronts and non-traditional paths to market"--with so many alternative retail outlets from independent app stores and device makers, developers have few compelling reasons to work directly with operators, especially when the majority of consumers now look past carrier decks for mobile applications and content. A Nielsen Research survey issued in February reports that nearly two thirds of subscribers believe that media organizations, digital services firms and software developers are more appropriate application providers than mobile operators, whom consumers deem "most appropriate" to offer more conventional wireless services like voice, SMS and MMS. The schism is exemplified by a recent Billboard report stating that operators now account for just 4.9 percent of digital music sales in the U.S., down from 6.6 percent in 2008--consider that while Apple's iTunes generates 26.7 percent of all U.S. music sales, its iPhone operator partner AT&T (NYSE:T) yields only 0.48 percent of sales, off from 1.04 percent two years ago.

Time will tell whether T-Mobile's move heralds a larger shift in how operators interface with the application ecosystem. Already its rivals are pursuing increasingly divergent paths--earlier this year, Verizon Wireless (NYSE:VZ) introduced its own application storefront, V Cast Apps, while Sprint partnered with GetJar to add the indie app store's catalog of free applications, optimized for feature phone subscribers as well as BlackBerry and Windows Mobile smartphones. AT&T is also targeting the feature phone demographic, introducing a suite of new cloud-based services optimized for mass-market devices. Developers have never had so many options to reach subscribers--and now more than ever, their decisions directly impact how operators do business, not just vice versa. -Jason

Suggested Articles

Here are the stories we’re chasing today.

Here are some other stories we’re following.

Here are the other stories we’re chasing today.