App stores offer contact with millions of consumers
Rapid growth of the smart-phone market in Thailand has heated up competition between phone manufacturers. It has also opened up opportunities for Thai software developers.
Jimmy Software is a local company that has been developing software for mobile phones for more than a decade. Its founder Panutat Tejasen sees the burgeoning smart-phone market and the battle for supremacy between Apple's iOS and Android, the two main operating systems, as a realm of opportunity for local software developers.
Adding to potential for developers around the world - including those in Thailand - is the application-store concept, which allows them to offer their applications to millions of potential customers, such as all iPhone and iPad users.
"Smart phones have been around for more than 10 years, but most of them have been mobile phones for corporate use. Smart phones are now moving into ordinary consumer use, and that is a huge market, compared to that in the past," Panutat said.
He believes that in the future, only three smart-phone operating systems, or platforms, will share the vast majority of the world market: iOS, Android and Windows Phone 7.
In the new era, smart phones will have a distinctly different identity to those in the past. They will have two main features: support for application downloads and touch screens. Importantly, they will be widely used by ordinary consumers rather than by corporate executives, he said.
Panutat said iPhone and its app store, iTune, had totally changed the business ecosystem related to mobile-phone software and applications. It is an open market that welcomes all software developers to sell their products. About 95 per cent of applications submitted to iTune are approved within a couple weeks, and are then offered for sale in a vast market where every application has an equal chance to be noticed and bought by millions of users around the world.
"It is an easy market for anyone to tap into. On the other hand, it attracts a lot of competitors as well. About 200,000 apps are available on iTune, so it means the competition is tough. If you want to be successful in an app store, you must be quick. There are about 400 new apps approved and posted on iTune and their product life cycle averages only about one month," Panutat said.
Some Thai software developers have been successful in app stores, for example "Grow Hockey", a game developed by a Thai developer, was ranked among the top five applications on iTune and had more than 10,000 downloads per day.
"This market is similar to the music industry. If you have only one app that is very famous and a hit, it might have millions of downloads and generate huge revenue over a number of days," he said.
"At present, the number one app on iTune has around 15,000 to 20,000 downloads per day in the US, while the number one app in Thailand has only 40 downloads per day. There is a huge gap, so if Thai developers want to be successful they have to think globally, and develop their apps to be hits among users in US."
He said Apple's iTune app store was successful because it emphasized the commercial value of applications. Revenue is shared between iTune and the app owner on a 30:70 basis. The Android app store, called Android Market, focuses on apps that are free of charge to users, and revenue comes from advertising.
From a developer's point of view, participating in iTune can make more money than Android's Market, he said.
Currently, iTune is bigger than Android's Market because the number of iOS devices in use around the world is larger than the number of Android devices. However, this situation is expected to reverse over the next few years, with Android phones surpassing iOS devices.
Apart from iOS and Android, Panutat believes a third smart-phone operating system, Windows Phone 7, will join the big two for a major share of the world's smart-phone market. He said Windows Phone 7 was expected to reach peak use in December this year. The strategy of its maker, Microsoft, is to lead the market release of Windows Phone 7 with other major products - WindowsLive and Xbox - in order to help Windows Phone 7 to compete on equal terms with iOS.
He believes BlackBerry will end up serving a niche market and Nokia's platform will decline continuously. Even though Nokia has realised the smart-phone market trend and has joined Intel in codevelopment of a new platform, he believes the move is too late because both the iOS and Android ecosystems are growing rapidly.
As for Jimmy Software, Panutat said the company had sold applications through iTune before the Apple app store's market expanded rapidly, and had made a lot of money.
"During only two years, we developed apps for selling on iTune and we received a lot of revenue. This was much more than we made in 10 years of working with the Windows Mobile platform," he said.
However, once iTune became a tough market, Jimmy Software turned to focus on the Android platform. The company has now signed a contract with HTC (Thailand) to develop local applications for Android called "myHTC", to serve only HTC users in Thailand. With an initial budget of Bt4 million, the company will develop myHTC for three years. It will have four main categories: chat and share, news and information, education - including a dictionary and e-books - and entertainment, with games, music and movies. New HTC smart-phone users will be able to install myHTC themselves by accessing www.myhtcsite.com/apk, or ask HTC resellers to do it for them.
As well as the myHTC development, Jimmy Software's main business is now outsourcing applications development for the iOS platform. It also plans to develop apps for Windows Phone 7, because it believes the Microsoft operating system will soon join the other two as the world's main smart-phone operating systems.