Apple and the Bot War on Apps

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Comments

  • Reply 21 of 42
    MacProMacPro Posts: 19,718member
    I can't help wonder why Pixite didn't just bank  / save the earnings while they made them.  Why did they end up with such overheads that required ever more sales?  Had they simply stayed lean and mean realizing they just may have a short term one hit wonder on their hands and count their blessings and saved their earnings, they could be living on a tropical island by now.  Well at least happy!  Well perhaps they did, I hope so.  The world is full of those that 'made it' then blew everything trying to 'make it even bigger'.  
    radarthekatdoozydozenration al
  • Reply 22 of 42
    badmonkbadmonk Posts: 1,285member
    Once again DED, your article provokes strong visceral responses from people because it is forcing them back into reality against their false perceptions.  Thank you.  Loved your insights into iMessage, especially how "the green bubble people" are going to be missing out.
    DanielErannolamacguyai46brakkenmagman1979doozydozenjony0ration al
  • Reply 23 of 42
    crowleycrowley Posts: 10,453member
    Apple is in the middle of a bit of a pivot toward the enterprise.  While others trip over their own feet along the razor's edge of autonomous driving and virtual reality, both of which have nebulous near-term monetization potential, Apple is going to quietly carve out an incremental $30-50 billion in annual revenue from enterprise sales with its existing hardware and services businesses.  Give them two more years to get there.  Meanwhile they'll iterate on those other things behind the R&D lab doors, ready to enter those markets at a time when the rewards are greater than the risks.   
    What does this have to do with bots. And what's exciting about being an enterprise company? Who's ever been. excited about Microsoft? Apple selling more hardware and services to the enterprise might be good for me as a shareholder but it sure as hell doesn't excite me as a consumer.
    Plenty of people get excited about Microsoft and enterprise development. Just because you don't find it interesting and the consumer market doesn't consider it particularly sexy doesn't mean no one is excited.  Microsoft run major conferences on the same level as WWDC purely around their enterprise software development.

    http://www.microsoft.com/en/envision
    http://ignite.microsoft.com
    edited July 2016 doozydozenjony0ration al
  • Reply 24 of 42
    What does this have to do with bots. And what's exciting about being an enterprise company? Who's ever been. excited about Microsoft? Apple selling more hardware and services to the enterprise might be good for me as a shareholder but it sure as hell doesn't excite me as a consumer.
    I'm a big shareholder.  So that's my focus.  And Apple's expansion of iMessage in iOS 10 will bring enterprise collaboration contexts, like ad hoc meeting negotiation (the coordination of a suitable meeting time) among team members, as one example.  This, and apps built by enterprise, which themselves are free to employees, or that are provided to customers as part of an enterprise SaaS product and therefore don't generate App Store revenue, will still be a key driver of app usage and iDevice sales.  What's exciting about any business, to me, is how it serves its customers, not all of which are retail consumers.  And how well it can monetize its lines of business.

    Someone gets it. As with all Apple announcements at WWDC, you have people who see a new feature and scratch their heads wondering what it could be used for. Then you have people who see the wide ranging potential of something. The latter are those who come up with all those really great Apps we all use and love.
    brucemcnolamacguyDanielEranai46magman1979doozydozenjony0ration al
  • Reply 25 of 42

    dacloo said:

    Stupid article. Instead of embracing the actual issue of developers not making any money anymore (besides the top 100 apps) and proposing solutions, this rant is truly the definition of irrelevant.

    What a stupid comment, and not surprising considering the source.

    A very large number of Apps aren't designed to make money. They are provided as a service. Just one example is banking Apps. There are literally thousands of these from all the various banks, credit unions and credit card companies. They are 100% free and never make any Top 10 lists or charts. Yet they are downloaded hundreds of millions of times. And they were all created by developers who you can be damn sure got paid well for their efforts (most likely they are a full-time employee of each institution that works on nothing but mobile).

    Want to know a few other types of Apps that fit this category? Apps for sports teams, your local public library, schools and educational institutions, online forums, government institutions, hospitals, city services - the list is endless. Again, all free, don't generate revenue, and were created by a developer(s) who got paid for their work.

    Want to know what else these Apps share? They are found by users because they saw a sign in their bank (for example) or a link on a website. There's no discovery issue for these Apps at all, since people find out about them through other means. And when they search for them using specific terms, they always come up right away.

    This is why I laugh at all the IDIOTS (and yes, that's what they are) who do these stupid App discovery hit pieces and claim developers aren't making money. They typically take the total number of Apps in the App Store and divide that by the amount of money Apple pays out (which, BTW, Apple is the only company to publish these type of figures - Google is too afraid to). They then assume that each developer makes hardly anything based on this flawed math.

    Even funnier is claiming Apple has a problem and developers don't make money, but refusing to talk about Google. With the Google Play Store having the same number of Apps as The App Store, yet paying out around 1/4 the money to developers, then what would you say about Android developers not making money?
    radarthekatbrucemcDanielErannolamacguymagman1979doozydozenjony0ration al
  • Reply 26 of 42
    thedbathedba Posts: 762member
    badmonk said:
    Once again DED, your article provokes strong visceral responses from people because it is forcing them back into reality against their false perceptions.  Thank you.  Loved your insights into iMessage, especially how "the green bubble people" are going to be missing out.
    Check his column history. Most of his "insights" are merely wild predictions that do not come to fruition. And this is just wrongheaded. Bots and messaging are not attempts to unseat Apple or apps, but rather ways to exploit new technologies by creating new services. Take Spotify: they weren't trying to "destroy iTunes" but rather create their own product with new(er) technology, and the same with YouTube before them. And the messaging services and chatbots that actually succeed will use the iPhone as their main hardware platform just as YouTube, Spotify and Facebook do.

    Seriously, is this columnist threatened by or opposed to all efforts at R&D and innovation, seeing them as either attempts to destroy Apple or infringe on Apple's intellectual property? It really does appear as if he needs to get a grip.
    When DED appears in the Apple Insider podcast as a guest, he's actually very toned down, a lot less fan boyish, I would say. His editorials on the other hand do tend to get a bit abrasive. 
    singularitydasanman69jony0
  • Reply 27 of 42
    I prefer to use mobile Safari for many things these days, like Facebook, LinkedIn or whatever. The biggest reason is that you can block ads now, whereas in Apps you cannot. Facebook App sucks your battery dry and is always doing something, even when you don't want it to (and even when you disable background refresh). There are still great apps, there are good games for example and good productivity software, but I probably download an app every 2 or 3 months or so at most. Back in 2009, I was downloading them daily!
    ration al
  • Reply 28 of 42
    "Apple get apps because: stuff they did 20 or 30 years ago including copy/paste" That doesn't make sense on any level
    dasanman69
  • Reply 29 of 42
    brakkenbrakken Posts: 687member
    Another great article, Dan. I love the historical context leading into the contemporary. I really wish all writers would bother providing such a framework - most news and blogs are as interesting as plastic, and somewhat less useful than a torn plastic bag.

    I was a little confused with the revenue figures as provided for the App Store. I will re-read later. It is surprising that Apple has yet again managed to build a business out of a concept that seems so plainly obvious, but which goog and ms repeatedly fail to do year after year after year - and Dan, you always hit the nail on the head with relevant insights as to why.

    In the comments, I noticed those incensed by your article failed to provide any logical or rational response, insight, or alternative perspective. I guess you've been getting that for over a decade now, though.

    As Apple continues its progress, the artless ms and the cheap goog will gradually become App Extensions. What else will they be able to do? Since the iPhone rewrote the mobile industry, all of Apple's competitors have been seeing reducing profits - except for ss's brief copygate bazaar, but that has come to a resounding end, thank goodness.

    Do you see any way that Apple's competitors, present or future, could create an alluring and profitable business outside of Apple? 

    If ms focussed on making the best Office, if goog focussed on the best search, it still seems to me that neither will recoup what they've lost, due directly to their business models failing to win consumers in a profitable manner - and failing to evolve either in tandem with or because of Apple.

    Currently, the iPhone and iPad markets are not continuing to increase. Even if it levelled off, Apple still has billions a year to continue developing and innovating. But if this is true, how on Earth will Apple's competitors fare? If the market shrinks at all, any bad news for Apple would seem to be devastating news for everyone else.

    WiMo is restyled to be like iOS with fully integrated goog search with ad-supported apps creating a 'looks free' user experience, and hardware makers standardise on screen resolutions, and three tiers? I still don't think it would work. Maybe some brilliant people will pop up in another country, creating a new OS and UI that 'just works', and will not be a copy of Apple? 

    Maybe...
    brucemcDanielEranjony0ration almacky the macky
  • Reply 30 of 42
    maestro64maestro64 Posts: 5,043member

    The only important take away from the article whether you want to believe in App or messaging or AI or AR or BOTs is the fact Apple Software Store business grew 20% YoY and continues to grow.

    Yes some developers make money and others are losing money, but that does not say anything about the App store or Apple. It is just the natural course of business. The ones making money are not saying much since they are too busy making money. The only ones we are hearing from are the ones not making money, they are the loudest voice  since they are not making money they have time to complain.

    If Apple business strategy is so wrong why do they continue to make money and grew their business. Keep in mind Apple is the best at capitalizing on trends, we all know they are not always first to a market but in the last 20 yrs they dominated the markets they have gone after. No other company can say they make as much money in any market like Apple does. BTW dominate does not mean you sold more widgets than anyone one else, it means you control the conversation and make most of the money.

    edited July 2016 ration almacky the mackyDanielEran
  • Reply 31 of 42
    normmnormm Posts: 653member
    These rants get more nonsensical and pathetic every time one is posted. The app boom is over, just as surely as the Wii shovelware train eventually came to an end. There's simply too much garbage in the Store now, and Apple won't do the needed purging. Will there be the occasional hit? Sure, but not like the old days. 
    According to IDC numbers, 70% of all the developers in the world write at least some software for iOS.  App installs on iOS are growing at about 130% per year.  Total payments to developers is about $50 billion at this point, increasing by about $20 billion per year right now, and going up at a rate of about 20% per year for the past few years.  You can see the graphs for all of this at http://www.asymco.com/2016/06/16/state-of-the-ecosystem/ .  Where do you get your figures that say the boom is over?

    doozydozenjony0ration almacky the mackyDanielEran
  • Reply 32 of 42
    brucemcbrucemc Posts: 1,541member
    While I agree that the article was a little inconsistent in places (and a bit more rambling than DED's more recent work), as always the negative comments are either attacking the writer, or a couple of details, rather than addressing or rebutting the premise - the hype that messaging and/or "bots" will negate the need for Apps, and that Apple's App Store business is yesterday's newspaper.  That the mobile OS is going to be quickly irrelevant, and it will be the messaging platform (or other higher stack "platform") that will rule all.

    What is going to replace the Apps that people use on their phones?  Does it make sense to build an application on a "messaging platform" to watch a video, purchase physical goods, or play a game (like the TechCrunch graphic shows)? What does "messaging as a platform" really mean?

    Everyone likes to talk about what "could be", and discount as worthless going forward what is here & working.  Let's look at the biggest social and messaging company today - the big whale if you will - the company that many think will eclipse Alpha/Google and Apple in market cap - Facebook.  For full year 2015, Facebook had revenues of $17.9B USD, with a "net margin" of $3.67B, or 20.5% (operating margins were higher at 34.7%).  Revenue grew almost 44% year-on-year.  They have 1.6B Monthly-Active-Users.  So, still really good revenue growth (almost all advertising - 95%), and MAU still growing, though slowing as a percentage.

    Facebook is still generating great overall revenue growth, are increasing their monetization, and increasing engagement.  So we can expect them to grow that top-line quite well for awhile (I am not disputing this - I agree with it).    Their market cap is $334B as of today, with a PE of 72.  

    Compare with Apple (from same source - revenueandprofits.com).  2015 Revenue of $233.7B USD, and net margin of $53.4B USD (22.8%).  And a PE of 10.8.  Apple's growth has hit a bump, but many experts expect it to resume, though certainly slower.  A PE of 10, given Apple's cash and shareholder return policy, essentially values Apple as worthless in 10 years.  Really???

    Here's the thing.  I fully believe that FB will grow revenue & earnings faster than Apple over the next 5 years.  But they are starting from revenue which is 13x less, and net margins which are 14.5x less.  Do people really believe that FB will keep that growth rate up? As they start to max out perhaps around 2B (or less) MAU?  If FB's market cap gets to be $500B like Apple, will there be perhaps more scrutiny about the real $$$ the FB can expect to earn?

    My kids are not on FB and likely never will be.  They are all about Snapchat, YouTube, and the latest games.  But they still want the best mobile devices...

    Just something to think about, and perhaps why DED goes to such lengths to make a point that Apple isn't exactly stupid and have been able to adjust to market changes over time.


    edited July 2016 ration alDanielEran
  • Reply 33 of 42
    rhoninrhonin Posts: 60member
    These rants get more nonsensical and pathetic every time one is posted. The app boom is over, just as surely as the Wii shovelware train eventually came to an end. There's simply too much garbage in the Store now, and Apple won't do the needed purging. Will there be the occasional hit? Sure, but not like the old days. 

    I mean, this entire rant contradicts itself multiple times. 
    So true.  What's even more broke is the ability to search for apps.  To find a decent relevant for the App Store I use Google.  Wow.
    For Enterprise, most either leverage and mod existing apps or develop their own apps.  Two I consult for and one I directly work for all have a company app store.
    For bots - I can see this growing however will it follow the app evolutionary path?  I see more of the Instant App feature being the future. 
    edited July 2016 tallest skil
  • Reply 34 of 42
    This was a badly written article and really should be backed up with application developers and statistics. I'm not sure whom approved it, but definitely a rant rather journalism. As a side note, I whole heartedly agree. As a mobile application developer for one of the largest companies in the business, I can say that I don't see a pivot point in the near future for native mobile applications. Web applications are in the same state they were since launch, people want them to succeed when they inherently shouldn't and can't. Apple's focus on extension functionality has bridged native application development with the supposed future of chat bots/etc. Each of these 'future' tools is A.) Integrated into an application B.)Compliments the application. That's what everyone seems to forget :/. A Jenkins integration into Slack still requires Jenkins, just like a Map integration still requires a mapping application. People seem to be asking for monolithic applications more and more when the reality is collaboration and integration.
    edited July 2016
  • Reply 35 of 42
    dick applebaumdick applebaum Posts: 12,527member

    radarthekat said:

    Apple is in the middle of a bit of a pivot toward the enterprise.  While others trip over their own feet along the razor's edge of autonomous driving and virtual reality, both of which have nebulous near-term monetization potential, Apple is going to quietly carve out an incremental $30-50 billion in annual revenue from enterprise sales with its existing hardware and services businesses.  Give them two more years to get there.  Meanwhile they'll iterate on those other things behind the R&D lab doors, ready to enter those markets at a time when the rewards are greater than the risks.   

    *
    *
    *

    I'm a big shareholder.  So that's my focus.  And Apple's expansion of iMessage in iOS 10 will bring enterprise collaboration contexts, like ad hoc meeting negotiation (the coordination of a suitable meeting time) among team members, as one example.  This, and apps built by enterprise, which themselves are free to employees, or that are provided to customers as part of an enterprise SaaS product and therefore don't generate App Store revenue, will still be a key driver of app usage and iDevice sales.  What's exciting about any business, to me, is how it serves its customers, not all of which are retail consumers.  And how well it can monetize its lines of business.

    Both of your posts are spot on!

    The Apple/IBM Mobile first partnership, IMO, will be a source of great income and leverage to both parties ...  They will offer solutions that won't be available from any other source.

    Here's an example (2 parts) where an IBM developer creates a MobileFirst app that runs on the Apple Watch and accesses data from the IBM Cloud.   The whole thing takes a couple of hours to develop -- it is mainly written in Swift.  This was developed over a year and a half ago -- some time was wasted because the IBM APIs were written in Obj-C and bridged to Swift.  I suspect they (will be/have been) rewritten in Swift.  

    And, there's this:

    After medical school, IBM's Watson gets ready for Apple health apps

    The Watson Health Cloud - set to become an important component of Apple's health platform - is targeting medical care, IBM says.


    http://www.zdnet.com/article/after-medical-school-ibms-watson-ready-for-apple-health-apps/




    https://www.youtube.com/watch?v=DfJlSnR-RgM

    I read, somewhere, that IBM has long-term plans for the server-side to replace Java and Node.js with Swift -- the advantages of having common code running at both ends of the pipe.

    And, SOT, this Pokémon go thing ...  There are lots of enterprise possibilities for an app like this ...  They know who you are, where you are and when ...

    edited July 2016 ai46jony0ration albrucemc
  • Reply 36 of 42
    foggyhillfoggyhill Posts: 4,767member
    Grimzahn said:
    Any message platform that want to replace apps, need to be able to run on a very low level to offer everything. At the point where it is able to, it is no more a message platform, but an operating system.

    "The Emperor's New Clothes"
    Bots are not new. They are nothing more than backend services. This is not about the future, but about selling something very old as new.

    And why?
    Facebook shareholder value. 
    Facebooks value was the big experiment in "Swarm behaviour". But it didn't generate enough money this way. So the want a pice of any business that run though their systems. 
    And Microsoft started to buy less junk apps to boost their app-store numbers. Instead they focus since 2014 on selling backend services. So they jump on the wagon. Do whatever app you want on any platform but though our systems.


    Well, I see it as the cloud as an "OS," the OS is based on one unit, while the new services could be anywhere, and based on one or millions of units.
    So, the IOT enters in there somewhere.
    But, you're right, they're system level services mostly baked in to be able to do more.
    That means Google and Apple will be ahead of anyone on this.

    Most apps, except games and specialized tools, will eventually be a front end for systems/cloud services; they will use API's to access/use those services.
    Even games will be plugged into a lot of those system services.
    Apps used API's to access system resources, this is just an extension of that really.
    edited July 2016
  • Reply 37 of 42
    dacloodacloo Posts: 890member
    badmonk said:
    Once again DED, your article provokes strong visceral responses from people because it is forcing them back into reality against their false perceptions.  Thank you.  Loved your insights into iMessage, especially how "the green bubble people" are going to be missing out.
    Lol! You're a funny guy.
  • Reply 38 of 42
    dacloodacloo Posts: 890member
    Try a paid AppAnnie account (there are multiple options if you prefer another data provider). You'll see that only a few make money. Many billions are made by the top 5 devs. 
    The boom IS over and many quality devs are in trouble.
    normm said:
    These rants get more nonsensical and pathetic every time one is posted. The app boom is over, just as surely as the Wii shovelware train eventually came to an end. There's simply too much garbage in the Store now, and Apple won't do the needed purging. Will there be the occasional hit? Sure, but not like the old days. 
    According to IDC numbers, 70% of all the developers in the world write at least some software for iOS.  App installs on iOS are growing at about 130% per year.  Total payments to developers is about $50 billion at this point, increasing by about $20 billion per year right now, and going up at a rate of about 20% per year for the past few years.  You can see the graphs for all of this at http://www.asymco.com/2016/06/16/state-of-the-ecosystem/ .  Where do you get your figures that say the boom is over?


    edited July 2016
  • Reply 39 of 42
    crowleycrowley Posts: 10,453member
    dacloo said:
    Try a paid AppAnnie account (there are multiple options if you prefer another data provider). You'll see that only a few make money. Many billions are made by the top 5 devs. 
    The boom IS over and many quality devs are in trouble.
    normm said:
    According to IDC numbers, 70% of all the developers in the world write at least some software for iOS.  App installs on iOS are growing at about 130% per year.  Total payments to developers is about $50 billion at this point, increasing by about $20 billion per year right now, and going up at a rate of about 20% per year for the past few years.  You can see the graphs for all of this at http://www.asymco.com/2016/06/16/state-of-the-ecosystem/ .  Where do you get your figures that say the boom is over?
    Does this sort of analysis take account of all the apps that aren't intended to make money in and of themselves, but support another paid service?  I have quite a lot of apps on my phone that were free and have no IAP, but give me access to other services that I pay for - e.g. banking, streaming video, news.

    Not saying you're wrong, I think you're almost certainly right, I just wonder how these support apps are affecting the figures.
  • Reply 40 of 42
    croprcropr Posts: 1,122member


    Even funnier is claiming Apple has a problem and developers don't make money, but refusing to talk about Google. With the Google Play Store having the same number of Apps as The App Store, yet paying out around 1/4 the money to developers, then what would you say about Android developers not making money?
    I own an app development company since 2012.  And I talk a lot with colleagues who are facing the same issue.  In case you don't realize, app developers have a very difficult time to make an earning.  Developing a typical app costs around 50K, with the 30% cut of Apple this means you have to make roughly 70K for a break even, while Apple has already created 20K of margin at that point.

    Of the 7 apps I have published on my account, 5 are loss making and the 2 that are profitable, only because they are both available on iOS and Android.  If I would have developed these apps only on iOS they would also be loss making.

    From the developers point of view, there are major issues with the app ecosystem (especially the Apple app ecosystem):
    1. Your apps are not discovered by the end user.  The crappy search function in the App Store app does not help (Luckily Google finds apps much better, even those on iOS).  One wonders what the actually return is for the 30% cut Apple is charging.
    2. You cannot market your apps like you would want to (no discount coupons, no differential pricing per region, temporary promotions, ...)
    3. You cannot reward customer loyalty, giving a discount for a next purchase.
    4. You cannot direct your customer to additional services outside the app.
    This last point explains partially the difference between the income on iOS vs Android.  A clear example is Spotify.  Spotify is allowed on Android to direct the user to its premium service.  On iOS Apple refused the app with the same functionality. So some Spotify users on iOS are paying $12.99 iso. $9.99 because they don't know there is a premium service available on the Spotify website. 

    You could ask how I make money:
    1. By making the app free and by running a subscription service outside the app ecosystem. (like evernote, trello, slack, ...)  The most recent app I launched, works this way and is quite successful.  I don't have to pay a 30% cut, but I have to do the marketing and payment myself (I had to do the marketing anyway, now that the visibility of an app approaches zero).
    2. By making apps for third parties.
    For my apps, there is an important difference is revenue split between iOS and Android.  For inapp revenue the split is about 60% iOS, 40% Android.  For the outside subscription it is the opposite:  60% Android, 40% iOS.  In total I get slightly more revenue from Android.

    DED has written an article full of BS, He thinks he knowledgeable about app developers but he completely missed the ball. I like his articles about the vision and products of Apple, but he should better informed before he writes this shameful piece about apps
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