Mobile device

The Role of Mobile Device Manufacturers and Mobile Operators in the App Economy

— By Elad Natanson, CEO, Appnext (an Affle company)
When Google launched its first app store, known as android Market in 2008, there were only 50 apps available for users to choose from. At the time, Google Eric Chu described the store as more of a “marketplace” where developers would have an open and uncluttered environment to launch their content. In fact, launching a new app was as easy as registering as a merchant, uploading the content, and giving it a description. For developers, it was the golden age of launching a new product. In those early years, some app store optimization and a limited social media ad campaign might be enough to ensure that a new offering is the go-to option for most users.
Today, the app landscape is very different. In the first quarter of 2021, there were 3.48 million apps for Android users to browse. For iPhone users, 2.22 million apps were available on Apple’s App Store. In this transformed app ecosystem, the methods that once worked for marketers have become much less effective. New products now risk being lost in a sea of ​​competition. For example, consider the effectiveness of app store optimization when releasing a new health and fitness app. According to data from AppAnniein 2020, 71,000 applications in this sector alone were launched both on Apple App Store and the Google Play store. Figures from Statista indicate that almost 70% of all new apps have not reached the 1,000 download mark. In short, the rivalry between novelties has never been so fierce and the chances of success have never been so slim.
Amid a surge in competition in app stores, developers need to explore alternative avenues to ensure their apps reach a wide audience. Device manufacturers and mobile carriers are having a profound impact on app discovery, including enabling developers to leapfrog the competitiveness of app stores. One area that has completely shaken up the field of app discovery is the increased use of preloaded apps. While preloaders aren’t new, the range of preinstalled apps has grown significantly over the years. Many users now see these apps as a must-have feature of their smartphones, as opposed to unwanted bloatware. This shift partly reflects the growth of third-party app discovery platforms that manage the relationship between developers and manufacturers. These new partnerships have paved the way for much smaller app developers to enter the preloading arena by working alongside other new developers under the umbrella of a platform that deals directly with OEMs. These platforms have developed technology that allows for a much more personalized approach to preloading. Essentially, manufacturers no longer take a one-size-fits-all approach. Instead, they view users as individuals and realize that an app one user covets is an unwanted consumption of storage space for another.
The benefits of preloaded applications for users, developers and manufacturers are clear. For users, there’s the convenience these apps provide – this means no longer having to navigate the App Store, as instead users get personalized, contextualized recommendations right on the app. device. Users trust software that has been carefully chosen by the manufacturer and has been thoroughly checked. This security guarantee means they’ll likely have fewer worries about malware or data collection. The process of discovering applications targeted to user needs guarantees much greater customer loyalty. The trust that users place in these applications benefits both manufacturers and developers. For manufacturers, they strengthen their brand by providing better user satisfaction.
These users are likely to upgrade their device to the latest model when it is released, as they want to ensure that the apps they had before will be available to them in the future. Additionally, users tend to avoid the inconvenience of buying a device from a different brand, which involves reinstalling existing apps and services that populated their previous home screen. For developers, this is an opportunity to circumvent the myriad of advertisements that users are exposed to every day. They have the ability to introduce their apps to millions of brand users around the world. This way developers ensure that their offering is the first thing a user sees and installs. As for operators, it’s the ability to maintain constant engagement with subscribers, recommend content to users, and provide special offers and upgrades.
Smartphone technology has of course developed rapidly over the past 15 years. These advances have paved the way for an increasingly personalized user experience. Users want to feel like their device is an extension of their personality: the device needs to know what apps and services users want right when they need them. The device must then respond in real time to fulfill this request. Manufacturers and carriers have been instrumental in achieving this symbiotic relationship. On-device app recommendations facilitated by third-party platforms have changed the way users interact with their devices. Breakthroughs in AI-powered technology mean recommendations are truly unique to the person receiving them. For example, food delivery apps may be presented to users when searching for takeout restaurants; E-commerce platforms that provide offers or discounts specific to a user’s location may be recommended when the user has expressed interest in purchasing something specific. Recommendations can be tailored based on device model, location, user behavior patterns, and the exact time of day when engagement is highest.
Although it might not seem immediately obvious, mobile carriers play a vital role in the global proliferation of this type of technology. Having devices that are 5G-enabled and capable of facilitating VR and AR experiences is just one aspect of delivering the latest smartphone experience. Without the expansion of networks in emerging markets and the investment in the infrastructure needed for faster download speeds and better mobile coverage, such advanced hardware becomes redundant. Fortunately, investments in the telecommunications industry in emerging markets such as Latin America and Africa are at an all-time high. For this reason, we can expect more opportunities for developers to expand into these locations, while manufacturers will also reap the rewards generated by buoyant sales.
As we look to the future, the app economy shows no signs of slowing down. Smartphone sales are expected to stay strong, innovation will accelerate, and users will enjoy better, more personalized, and ultimately more memorable smartphone experiences.

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