The State of the App-Economy

Mobile devices have become one of the most significant interaction points businesses have with their customers, making having a presence on these platforms crucial. The problem many companies face, however, is not should they develop an application, but whether the app will be native or coded in HTML5.  What will be more effective, an ecosystem specific app, or a web-based experience? Will native applications continue to dominate, or will the web take over?

Given the severe fragmentation issues on Android and the different programming languages used across the various platforms, HTML5 would seem like the logical choice. It allows for a consistent experience to be delivered not only across different mobile devices, but also between mobile and desktop platforms. The workload is reduced as it is much easier to develop a single HTML5 interface than building separate Android, iOS and Windows Phone apps, as well as a website. Not to mention the update and modification processes, native apps clearly require much more effort. Despite this and the fact that HTML5 has come a long way, developers are not jumping over from producing native apps. What seems to be the problem?

In an effort to circumvent the 30% fee Apple takes for all apps sold, the likes of Amazon and The Financial Times have created HTML5 based apps heavily optimized for iPhones. However HTML5 continues to offer an experience sub-par to that of native apps. Gestures such as swiping are not fully functional and don’t feel as smooth, and features such as offline storage are unavailable completely. Many device specific capabilities such as photo sharing cannot be incorporate into web-based apps. In addition the look and polish just aren’t quite there, as HTML5 apps aren’t built to fully take advantage of hardware and operating system frameworks.

Another issue to take note of is the how the apps are delivered to users. Apple and Google have built dominating content delivery platforms, and both are unwilling to cede control of their ecosystems. Despite Android being positioned as open source, Google is starting to show signs of following in Apple’s footsteps, who has created a fully closed environment. Developing for Android is a huge pain not only for developers but for users as well. Amazon has already launched a platform specific store of its own for the Kindle Fire, and will most likely continue to grow this should the rumors of the company releasing its own smartphone turn out to be true. Some might complain about the closed storefronts provided by the likes of Google and Apple , but they bring several benefits to developers. Having a native app results in a presence on a user’s screen, and the stores provide built-in transaction systems. It also adds monetization options, making it easier to charge for the app and making features such as in-app purchases much more comfortable for the user. HTML5 based programs require their own transaction infrastructure and rely heavily on advertising.

So will a shift from an app-economy to a web-driven one ever take place? For now, it looks fairly unlikely. A report by mobile analytics firm Flurry (quote) showed that mobile users spend 94 minutes per day in mobile apps compared to 72 minutes on the web, a number which continues to increase. What I see happening however is a move to a hybrid, where the mobile web and native app stores are combined. The reason for this is that the majority of apps are content driven. The way this would lead to stronger web interaction is through services, such as Twitter and Facebook, Instagram, and even games. These services, act as platforms for content, serving as a tool for discovery and consumption. The user begins their interaction through a native app, from where they migrate onto the web through links and discovered content.

Currently this content is often being wrapped to take advantage of native platforms. However more and more companies are starting to realize that having a presence in Google Play or the App Store are not as important to a strong mobile presence as they once were. It has become more important to show up in search results. Voice recognition services such as Apple’s Siri deliver search results through the browser, and not through native apps. I see this leading to a strong split between applications requiring device specific functionality and heavy processor use to content-driven apps which can just as easily be delivered through the web.

The mobile web will not replace native apps, but will complement them as an additional platform. Native apps continue to deliver the technically superior alternative, but it is the user and consumer behavior which will shape the mobile application economy. Developers and businesses need to understand how consumers interact with their devices, and how they can best deliver an excellent experience. We might still see developments in web technology that will help push web applications, but even then it will take time to change user behaviors, and it will always be tough to break the hold that Apple and Google have through their stores, which provide both companies with massive revenues. The shift might happen, but determining what model works best and delivers most effectively will take years. What remains clear is that applications will continue to be the driving force behind mobile devices.