Selling Content on the App Store – The New Rules April Fools
Mar 02

The iPad 2 introduced today brought few surprises. The obvious new hardware was there (camera) and obviously unrealistic rumors were confirmed to be false (e.g. retina screen).

The CPU and graphics speed bump is nice, and in line with Apple’s customary incremental improvements in performance for new hardware models. But pure specs and statistics don’t mean much. It will be interesting to see how much this will be noticeable when you’re interacting with the new iPad. The speed improvements in the first generations of the iPhone were really noticeable, the later ones, not so much. The question that many developers is asking is if there’s more RAM memory to go with the other hardware improvements?

HDMI output and screen mirroring is also very nice. I can see a new category of social games you play gathered around your large TV with an iPad as the central game machine, and each player using their iPhones and iPod Touches as game controllers. (If you add up all the hardware costs this seems like an ridiculously expensive console game, but I think that we’re at the point were many people have older generation of iDevices laying around – perfect for game controllers.) But even though this setup sounds cool to us geeks, it still feels that there’s something essential missing in the Apple entertainment system ecosystem.

The new thinner and lighter iPad 2 design will make the iPad shine when you’re comparing tablets side by side. But it’s hardly specs that you’ll base your purchasing decision on. And the iPad 2 is not yet close to Kindle territory in this aspect. But hold on to the “comparing tablets” thought, well get back to that.

Apple knows that the relentless Android copy machine will churn out many new devices this coming year. They will come in every conceivable combination of hardware specs, form factors and price levels. With the iPad 2 revision, Apple is ahead of, or on par with, the major competitors’ announcements. So when they eventually ship their devices, they cannot claim hardware superiority against the iPad. Thanks to Moore’s Law it’s very unlikely that any competitor will be able to launch a competing tablet in the next year with twice the hardware at the same price as the iPad, or similar hardware at half the price. So over the next year there will mostly be small, incremental changes in theses areas.

The major differentiating factor between competing tablets will be software. Consequently this was the theme of Apple’s event.

You can always argue if the number of iPad optimized apps (65,000) vs. the number of Android Honeycomb apps (100) are the right numbers, or if they are even the right categories to compare.
(We know that Steve has an affinity for nice, round numbers.) But it’s a fact that the iPad has a huge lead in tablet OS maturity and third party software.

Today Apple expanded that gap into a chasm, with the introduction of iMovie and GarageBand for the iPad.

These apps are fantastic in their scope, polish, target audience and aggressive price. How long will it take for equivalent apps to appear on Android? Or anything even remotely close? At the $4.99 price point those apps will have to be sponsored (especially given the size of the Android market for paid apps). Google are not exactly known for creating product with this level of finish. Who’s going to step up to the plate? Motorola? HP? Asus? Dell?

The notion that the iPad is just for consuming content is becoming increasingly silly. (But not as silly as Microsoft’s idea of differentiating tablet OS brands by this criteria.) The ease of creating music and video with these new apps is going to usher in a new era similar to the desktop publishing revolution started by the first Macs. And the cool creative people, teenagers and moms are all going to learn how to do this stuff on an iPad.

Back to comparing competing tablets: Imagine a store with the iPad on display next to several other tablets. The iPad runs iMovie, GarageBand, Pages, Numbers and several of the great 3rd party apps. With similar hardware specs, who in their right mind would pay more (a few hundred dollars more?) for one of the other tablets with a lot fewer apps, and definitely no apps as cool and as polished as the top of the line iPad apps?

Game over?

written by Nick

5 Responses to “Thoughts on Apple’s iPad 2 Event”

  1. Daniel Says:

    “Who’s going to step up to the plate? Motorola? HP? Asus? Dell?”

    Great point. Even if any of those companies wanted to dump the money into it, they couldn’t turn out anything as polished as Apple does, and they’d be creating software to sell hardware that was so heavily subsidized they wouldn’t make any money on it anyways.

    But I wouldn’t call it game over. Apple has an early, seemingly insurmountable lead, but we’re only a couple years into a race that will be going until someone figures out how to embed computers in our brains. A lot can can happen- think about how ‘game over’ was being used in the same sentence with ‘Apple’ in 15 years ago.

  2. Marty Says:

    The tough part about Apple’s apps. iMovie and Garage band. They raised the bar again from their Pages and Numbers apps. But also halved the price. I think you mentioned this in another article, it is very hard for developers to make a product and not want to sell it for $10 or even more. I feel this may become harder to do every time Apple drops their app prices.

  3. Tyler Says:

    I like the view that its the os more than the hardware that sells it. I am very happy with the new ipad. My company develops apps and we were worried that the display on the new one would be very different which would require two parallel versions of the app. Glad they just improved the speed and graphics.

  4. Keith Rowley Says:

    Not game over yet.
    Apple has the best device out the and I love my iPhone and plan to get an iPad now that v2 is out.
    BUT Apple can still kill this lead if they keep ticking off the people who have been the real source of their sucess, the independent developers. Apple can still loose out long term if they don’t get their arrogance in check.

    Suppose all independent subscription content providers leave the IPad because 30% is an insane amount to give up to apple just for permission to have thier content on apple devices. No more kindle books, no more hulu or Netflix, no more Logmein even – the original reason I bought an IPhone – if all these and most similar content left how long do you think Apples lead would last?

    Remember a few years ago when Apple had better computers an os but most people still used pc’s? Wait that is still the case:) – why is this? The large collection of software that runs on pc but not Mac! In the end the apps are what makes the iPhone / iPad great and loosing a lot of app developers due to continuing their history of crazy unfair app rules and rule changes is what could cost them their lead.

  5. Dude Says:

    @Keith Rowley

    You say independent devs could leave iOS but your example refers to publishers. And dont forget that Amazon takes a 70% cut of Kindle revenue!

    Sure Apple pisses of us devs here and there, but would you rather develop for Android where your app is mostly pirated.

    Also Windows amount of software has nothing to do with its dominance. Users dont want 100 media players, they want 1 good one. Price, Enterprise requirements & IT deparments are actual reasons (+ others)

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