IPhone Software Sales Take Off: Apple's Jobs
CUPERTINO, Calif. — Apple Inc.'s bet on cellphone software appears to be paying off. — In the month since Apple opened an online software clearinghouse called the App Store, users have downloaded more than 60 million programs for the iPhone …
Context & Ripple Effects
Apple has opened the App Store as a software marketplace for iPhone users, and more than 60 million downloads in its first month gives the company early evidence that phone software can be a meaningful part of the iPhone experience. The result matters because Apple is not merely selling a handset; it is establishing a controlled route through which users find and obtain software.
First-order effects
- Apple gains validation for the App Store as an iPhone distribution channel, while iPhone users gain a rapidly used source of software beyond the device’s built-in features.
- Software makers targeting the iPhone gain access to an audience that has already demonstrated willingness to download programs through Apple’s marketplace.
Second-order effects
- Phone makers competing with Apple face a stronger incentive to match the breadth and ease of a centralized software catalog, not just handset specifications.
- Apple’s control of the marketplace places it between software makers and iPhone users, giving its approval and distribution rules greater commercial weight.
Third-order effects
- If download demand persists, handset competition will increasingly turn on software ecosystems whose operator controls discovery, distribution, and access to customers.
- The App Store model points toward mobile platforms becoming gatekeepers for independent software businesses rather than passive device vendors.
The trend: Mobile phones are evolving from fixed-function devices into software platforms, with the marketplace operator gaining leverage over both developers and users.