There’s an App for That

Apple’s iPhone applications are opening the door to hand-held computing in a big way.

“There’s an app for that” has become the war cry for a phone that, at first, seemed to be over-priced and over-hyped. But Apple wisely opened up the iPhone to developers, and the result has been staggering. There are now over 35,000 applications available for the iPhone. Over one billion app downloads have been recorded in just nine months.

According to a recent smartphone intelligence report from Compete, a web analytics firm, 83 percent of iPhone owners have downloaded at least six applications. While the top iPhone applications fall into the gaming and entertainment categories, 25 percent of iPhone owners have downloaded business applications, and 32 percent have downloaded finance applications. Those percentages are considerably larger than the same two categories when compared to Blackberry, Palm, and Motorola users.

These numbers are interesting, given the fact that Blackberry has always been considered the de facto standard in business usage. In a recent post on ZDNet News, Seb Janacek of silicon.com reports that it was the iPhone, not Blackberry,  which took first place in a J D Power consumer satisfaction survey in all areas except one, battery performance.

The Blackberry Curve, says research firm NPD, outsold iPhone in Q1 2009 in the U.S., but that’s because of Blackberry’s buy one-get one promotion. Remember, too, that the Curve runs on multiple networks, while iPhone currently works exclusively on the AT&T cellular network. Janacek says, “I’m not convinced Apple will change this model or if indeed it needs to. With its exclusive deals, Apple can sustain high margins on the iPhone.” Nevertheless, a CIO magazine report claimed that Apple may be in talks with Verizon. Reports also indicate that Apple will be launching a new iPhone in the next few months.

iPhone is gaining traction in another area: advertising. According to a recent story in The Wall Street Journal, a number of advertisers, including Burger King, have either created applications for the iPhone, or included ads within other applications. Some, says the article, are “offering ads disguised as apps.”

The iPhone is starting to look like a legitimate business platform. Consider, for example the $20 application available from ProcessAway that turns an iPhone into a portable credit card terminal, linking it to Authorize.net’s payment processing platform so a business owner can accept mobile credit card payments.

Of course, not all apps are serious. Some, such as the one that allows an iPhone to make sounds that realistically resemble flatulence, are downright silly.

But as applications proliferate and Internet access becomes commonplace, the iPhone and other smartphones seem well positioned to become the all-in-one communication devices of the future. It will be interesting to see if they can also become e-commerce platforms that people trust for making monetary transactions and conducting business from the palms of their hands.