Intel announces AppUp, an app store for netbooks and beyond
It seems like the app store model popularized by Apple's iPhone is on its way from smartphones to other devices. Today at the Consumer Electronics Show in Las Vegas, chip-maker Intel announced that a beta test version of the AppUpCenter …
Context & Ripple Effects
Intel is extending a strategy it has been telegraphing since September 2009, when it first signaled it was getting into the App Store game and analysts questioned where Silverlight would fit. The bet rides on two confirmed data points from this week's CES stage: Apple has passed three billion downloads in under 18 months on the iPhone, and Intel showed its first Moorestown-based smartphone at the show.
The move also lands in a market already primed by its customers — Acer was mulling its own app store as far back as March 2009, so Intel arriving with a storefront for Atom-based devices answers a question its OEM partners had been asking themselves.
First-order effects
- Netbook makers running Intel Atom chips gain a ready-made app storefront to bundle with their machines, without each having to build and operate one themselves.
- Windows developers get a second distribution channel for small-screen PCs, but must now weigh Intel's terms against the iPhone ecosystem where three billion downloads have concentrated buyer attention.
Second-order effects
- OEMs like Acer that were considering proprietary stores face a build-or-join decision: joining AppUp means ceding the customer relationship and revenue split to Intel, while going alone means competing against the chip supplier's default offering.
- Microsoft is put on the defensive, since the app-store layer on Windows netbooks would sit above its OS and set the developer relationship on hardware Microsoft does not control.
Third-order effects
- If the pattern holds, control of the storefront — not the OS license — becomes the platform battleground on PCs, mirroring how Apple's App Store repositioned the carrier and handset maker in mobile.
- A chip vendor owning the software distribution layer would mark a structural break from the Wintel division of labor, pushing Intel toward the integrated platform model Apple uses and raising the odds of antitrust scrutiny of tied hardware-plus-store arrangements.
The trend: The iPhone App Store model is propagating from smartphones to every adjacent device category, with component suppliers like Intel racing to become platform owners rather than parts vendors.