Live

Watch CBSN Live

Google Voice and Apple: Software Versus Platform

In the face of the continuing controversy over Apple not approving Google Voice for the iPhone app store, David Pogue reports that Google is creating a web-based version of the application. It's tempting to keep riding that editorial wave. (Or would that be the editorial Google Wave?) But I think that all the attention to the specifics of the case has passed a more interesting discussion: whether software vendors will shift to a web delivery strategy to break a distribution hegemony to better reach customers.

Traditionally in the computing industry -- and what are smartphones other than small computers? -- there were platform companies and there were software companies. The platform vendors such as Apple and Microsoft made a good business out of selling software, but they weren't the only ones providing applications. In fact, the success of a platform was tied directly to the number of software companies, large and small, willing to support it.

One reason for the iPhone's success is that the specifics of the platform gave developers an interesting software canvas. Suddenly they could do things that would be impossible on other phones, and that meant consumers suddenly had access to capabilities. Although I do think there's smoke drifting across the mirrors in how many apps users actually download -- Apple hasn't answered my questions about how many of the downloads from the app store were actually music files and firmware upgrades, but my guess is maybe a third and possibly far more -- there's little question that the iPhone's hold on customers would be greatly diminished without the choice of software.

Other handset vendors, such as Palm and Google, have tried setting up their own app stores, though with far less success to date. Carriers have tried setting up app stores. What all these attempts show is an interest on the part of those who control platforms and connectivity to own software distribution. Most simply see it as a way to additional profit and strengthening customer relationships. Apple's actions suggest that it additionally sees an app store as a way to eliminate competition and exercise its need to control everything. But the massive common denominator is that companies want to increase vertical integration and own their channels of distribution, just as movie studios once owned the theaters and distribution chains, creating a vertically integrated industry that eventually became the subject of massive antitrust activity. (Tech vendors take note, if all the regulatory interest of late hasn't already made it clear.)

Developers, on the other hand, want the freedom to reach customers without having to be tied to a given outlet. Think of it in terms of distribution in other industries. You might have lawn and garden products that you want Wal-Mart to carry, given the volume the chain could handle. But that doesn't mean you wouldn't want to sell through a Target or Home Depot or even directly, so you can make greater profit by eliminating the chunk of money the retailer takes.

In software for personal computers, whether business or consumer, having a variety of channels is the norm, as is selling direct. Although getting into an Apple or Palm app store can be a good marketing vehicle, as Google and many others have found, it's worth nothing if the gatekeeper decides to leave you on the outside. The danger of having the platform vendor or carrier control the access is that it creates an effective distribution monopoly.

Moving to the web, though, would change all that by opening a backdoor to platforms. (Unless, as Pogue sardonically suggested for Apple, vendors started blocking individual web sites.) By writing to the browser, software vendors could take a cloud/SaaS approach and bypass the need to appease the guardians. Another advantage could be writing an application once and not having to create multiple versions for every individual handset a company wants to target.

By pushing the issue with Google, Apple may have undercut its own foundation for control. And even if suddenly Steve Jobs himself rolled out the red carpet of welcome, I suspect that Google would continue on its current course. Why be beholding if you don't have to be?

Image via stock.xchng user WolfTrance, site standard license.

View CBS News In
CBS News App Open
Chrome Safari Continue