Four days after Apple Inc. released its iPhone software development kit (SDK), the company announced that more than 100,000 developers had already downloaded the set of application programming interfaces (APIs) and tools used to create applications for the iPhone and iPod Touch.
Interest is definitely high. People around the industry continue to talk about the “iPhone effect” nine months after it was released.
The iPhone has led a surge in mobile Web browsing, and with so many Web sites already reporting the significant share of mobile visits coming from the device, many expect that trend to continue.
Apple, developers and investors are all banking on what they believe will be an explosion of new mobile applications for the device.
Peter Jarich, principal analyst on wireless infrastructure at Current Analysis Inc., said network vendors are beginning to notice the growth in network traffic as well.
“It seems like it really is impacting the way people use the services,” he said. “It’s really clearly going to be a good thing on the network side of things.”
Enterprise
The iPhone sells for $400 and even with enterprise features such as push e-mail and support for Microsoft Corp.’s Exchange coming in a software update in June, analysts aren’t sure if large businesses will support the device for corporate use.
“The Apple brand and the consumer-focused iPhone value proposition may preclude some sales in the enterprise. Even with secure corporate e-mail sync, it is still an expensive, entertainment-oriented device and some I.T. managers may feel that giving out what (Apple co-founder, Chairman and CEO) Steve Jobs called ‘the best iPod we’ve ever made’ would be more appropriate as a reward for a job well done than as a tool to do the job,” Kathryn Weldon and Avi Greengart wrote in a research note for Current Analysis.
Apple Inc. hopes its iPhone will draw in millions of new business customers by adding various enterprise applications. Indeed, Apple executives readily admit that the absence of such applications has limited the iPhone’s market.
The company is also trying to differentiate itself in the enterprise space by skipping the need for a Network Operation Center for wireless e-mail. A NOC acts as a go-between for devices and e-mail servers, a design used by Research In Motion Ltd.’s popular BlackBerry service. Calling that approach outdated and a function that “adds risks to liability,” Phil Schiller, senior VP of product marketing at Apple, said the iPhone will support push e-mail directly from e-mail servers.
The iPhone push e-mail will work faster by cutting out the NOC, Jobs said. “And it goes really slow when the NOC goes down,” he said, as a less-than-veiled knock on RIM’s recent e-mail difficulties.
The iPhone update will also include calendar and contact integration, global address lists, Cisco IPsec VPN, certificates and identities, WPA/802.1x, enforced security policies, device configuration and remote wipe.
Applications
The SDK, which was initially announced last year, will expand the unique relationship Apple has carved out for itself between device maker and end user. Indeed, Apple is the sole party responsible for the iPhone’s software and applications set.
The newly open iPhone system will rely on Apple’s App Store, which will serve as the exclusive distribution channel for all applications built for the iPhone and iPod Touch (which will need the 2.0 software update to run third-party applications). Developers interested in getting their applications on board will have to join the iPhone Developer Program for $99 and relinquish 30% of revenues to Apple.
Developers can set the price for their applications on the App Store and will get a 70% share of all revenues from purchases on a monthly basis. Jobs said the revenue share is about the same as what’s shared with record labels on purchases from iTunes. It’s also reported to be the same share Apple collects from wireless carriers.
“This is the best deal going to distribute mobile applications to iPhones,” Jobs said.
Apple will also shoulder all the costs of hosting, marketing and managing the App Store. Jobs said he doesn’t intend to make much money on managing the store.
And what if the developer wants to make its application available for free? “There is no charge for free apps,” Jobs said.
To demonstrate the quick development-to-deployment ratio, Apple introduced a handful of developers that it asked to build applications to demonstrate during the announcement. After Scott Forstall, VP of iPhone software, showed off a pair of in-house developed applications that can be controlled by physically moving the device around, he explained that each developer was given two weeks to see what they could come up with keeping in mind that most had never developed applications for MAC OS X before.
Electronic Arts Inc., Sega of America Inc., Salesforce.com Inc., AOL L.L.C. and Epocrates Inc. each demonstrated applications that either made use of the iPhone’s accelerometer, which recognizes the devices orientation, or the recently opened APIs that give them access to the device’s full suite of applications.
Each developer talked about how simple the development process was.
Ethan Einhorn, associate producer at Sega of America, said at first he doubted if the joystick- and keypad-free iPhone would meet his hardcore-gamer standards. But he’s been converted. “After two weeks with the iPhone, it’s going to be very hard for me to go back to playing (Super Monkey Ball) with a game controller,” he said.
Security
Apple isn’t completely opening the floodgates on third-party applications, however; under the company’s iPhone Developer Program, developers will each be assigned a unique electronic certificate.
