The groundwork for a robust mobile Web app ecosystem was laid in 2011. The HTML5 spec evolved and major players began taking note that, hey, there might be some potential with the mobile Web … if only it could be monetized. Mobile developers are certainly testing out HTML5 apps and where the developers go, the tools providers will follow.
For mobile developers, there are more tools to choose from than what IDE and framework to write code in. Developers also need to make money. In recent weeks we have seen several companies come out with payment models for HTML5 mobile Web apps looking to get an early slice of the pie that forecasters expect to grow exponentially in the next few years.
The latest entrant into HTML5 mobile Web payments is PaymentOne, an international direct to carrier billing service. PaymentOne released an HTML5 API today for mobile Web app and game developers to create easy integration of carrier billing for in-app purchases. PaymentOne is focused on micro-payments through the carriers and broadband providers to bring mobile payments to merchants, media and mobile developers.
There are several other players looking to create payments for HTML5 apps. AT&T released a suit of HTML5 APIs during the Consumer Electronics Show in January. Facebook will eventually look to monetize mobile Web apps through its Facebook Credits vertical. HTML5 development studio announced playMobi last week that is a set of tools for payments and analytics for the mobile Web. PayPal believes that it can become the de facto payments service for anything mobile, HTML5 or otherwise. PaymentOne fits in this ecosystem with its HTML5 API as one of the only options for direct carrier billing.
The goal for all of these companies is to create an ecosystem that benefits the developer. This has less to do with the actual technical implementation of payments in mobile Web apps than making development of mobile Web apps a viable option for publishers. We have talked about how HTML5 will be the “third platform” for developers in 2012 (after iOS and Android) but the only way that will be an option is if developers can find a way to make money. PaymentOne’s entrance into the vertical is an example of how the mobile ecosystem at large is creating tools to tackle this problem.
Developers: how do you plan to monetize your mobile Web apps? What are the best solutions available and what are you still looking for from the ecosystem to make your life simpler? Let us know in the comments.
Last November, after a security researcher revealed that many Android phones contained software that tracked keystrokes while users were dialing phone numbers, news providers boiled the issue into a genuine spyware scare. That gave Carrier IQ, the maker of performance monitoring software, a black eye in the public mind.
As the testing software maker continues to recover from a huge perception problem, a leading House Democrat is proposing legislation mandating that carriers inform customers of the existence of any monitoring software on the phones they intend to purchase, and obtain their consent, prior to engaging that software.
“Not later than 1 year after the date of the enactment of this Act, the Federal Trade Commission shall promulgate regulations under section 553 of title 5, United States Code, that require any person who is subject to the disclosure requirements of the regulations promulgated under section 2(a) to obtain the express consent of the consumer prior to the time when the monitoring software first begins collecting and transmitting information.” This is the first paragraph of Section 3 of the proposed Mobile Device Privacy Act (PDF available here), put forth today by Rep. Edward Markey (D – Mass.), who serves on the House Energy & Commerce Committee.
“While consumers rely on their phones, their phones relay all sorts of information about them, often without their knowledge or consent,” reads a statement from Rep. Markey’s office today. “I am concerned about the threat to consumers’ privacy posed by electronic monitoring software on mobile phones, such as the software developed by Carrier IQ.”
Carriers (or parties to the sale of a phone) failing to make this disclosure to customers, under Rep. Markey’s proposed provisions, could find themselves prosecuted for deception and/or unfair trade practices.
But that might not be the stickiest part of this bill. Under Rep. Markey’s proposal, once the customer consented to the monitoring software doing its job, the carrier (or other point of sale) would become responsible for maintaining a secure database of the identities of those who consented. Such a database could conceivably be used to retrieve data about the phones being monitored.
It would be precisely the situation that Carrier IQ says its architecture tries to avoid: tracking people. Rather, the company says its interest is in the performance and engineering of phones, for the benefit of engineers who build phones.
“In building a solution capable of scaling to millions of subscribers,” reads last month’s Carrier IQ white paper (PDF available here), “we understand that having an effective solution requires that the software gather only the critical diagnostic information and do so in a manner that protects consumers’ information. From a business perspective, using the least amount of data possible reduces costs in providing the service (less storage facilities, less data to analyze).”
Carrier IQ’s software is capable of detecting signal degradation down to the level of a single phone, pinpointing the location of that phone. But the company says it does not use personally identifiable data in its analysis. In that sense, the best way to safeguard customer data from being pilfered from Carrier IQ is for Carrier IQ not to have it in the first place. “Carrier IQ have no rights to the data that is gathered into the MSIP system for any Carrier IQ customer,” the company says.
Rep. Markey’s statement reminds us that his office requested the Federal Trade Commission last year to investigate Carrier IQ for possible unfair or deceptive trade practices.
When you control the pipes, you control the ecosystem. At the very least, you can impose your will on a good portion of the environment. This is what the mobile industry has come down to in the United States. Verizon, AT&T, T-Mobile and Sprint have as much or more say about the devices that eventually reach consumers hands than the platform providers or manufacturers.
Why do Android device updates take so long? Ask the carriers. Why are there half a dozen different skins for Android smartphones? Ask the carriers. Why do high-end smartphones cost what they do? Ask the carriers. Why did Nokia have to wait to enter the U.S. market with its new Lumia line? Ask the carriers. Why are there a ton of different versions of the Samsung Galaxy? Ask … you get the picture.
The Requirements Of The Carriers
Motorola Mobility CEO Sanjay Jha sat down with The Verge at the Consumer Electronics show this week and made the comment that “Verizon and AT&T don’t want seven stock ICS devices on their shelves … The vast majority of the changes we make to the OS are to meet the requirements of the carriers.”
Think about that last sentence for a second. “The requirements of the carriers.” Like it or not, the carriers are the gatekeepers to the entire mobile ecosystem in the United States. Hence, the carriers can make almost any demands and the original equipment manufacturers are forced to comply. This is why we see the skins on various Android smartphones like TouchWiz for Samsung and Sense from HTC.
The problem for Android and carrier-driven differentiation is fairly simple. Most OEMs are not very good at software. Motorola, for instance, has struggled for years in coming up with useful, dynamic and functional user interfaces. HTC is a lot better and Sense is actually an enjoyable interface on its Android smartphones. Samsung is a different story altogether.
Samsung Sets The Tone
Samsung is on a course to be the largest smartphone manufacturer on the planet. How have they done this? Outside of the bland argument that “they have copied everything Apple has ever done,” the answer is easy to understand. Samsung is completely willing to do whatever Google, Microsoft or the carriers want. More than any other company, Samsung plays the current mobile ecosystem to great success. Be everything to everybody. It is a brilliant strategy.
Samsung wanted to launch the original Samsung Galaxy S on every carrier in the U.S. That was not going to happen though if every device was exactly the same. That is why we have four different devices that are ostensibly the same hardware. Sprint wanted its Galaxy S to have a keyboard and use WiMax “4G.” Hey, no problem. AT&T wanted a slimmed down version that looked like an iPhone. This can be done. Verizon wanted something similar but looked different than AT&T’s. That should not be a problem.
By being pliant to the their wishes, Samsung gives the carriers power and to a certain extent hamstrings the rest of the OEM and mobile operating system ecosystem. To keep up with Samsung, the rest of the Android OEMs have to attempt to play the same game.
In The Verge’s interview with Jha, it sounds like he is fed up with trying to match Samsung and the rest of the OEMs and the carrier requirements. Jha understands that to make money in the Android ecosystem, Motorola smartphones are going to need to be different. Jha said this week that Motorola is going to make fewer phones and, presumably, think outside of the rat race that Android has become.
The Real Source Of Fragmentation
More than any other force, the carriers are responsible for the “fragmentation” of Android. The individual skins are not a specific requirement, but not having several stock Android devices on the shelves (at least one with that option would be nice) forces the OEMs’ hands. When it comes to device updates, such as what phones will get Android Ice Cream Sandwich, the carriers dictate how much data will flow through their pipes. The OEMs are not outside of blame for updates but the fact of the matter is that the carriers are the primary drivers of the fact that each OEM has to come out with a new Android device seemingly every other week. That puts a huge burden on the software integration departments of the OEMs that have to update each device.
Google chairman Erik Schmidt says that Android is not fragmented and argues that differentiation is a good thing. Hey, variety is the spice of life, yes? To a certain extent, he is not wrong. Personally, I do not want seven stock Android devices to choose from either. The problem comes when the skins, screen sizes and lack of updates make it difficult for developers to support several different types of Android.
Microsoft, Windows Phone and its biggest champion, Nokia, are not immune for the whip of the carriers either. One of the reasons that the Lumia line was not released to the U.S. before the end of 2011 was that Nokia had to navigate the individual wishes of every carrier. T-Mobile made it easy for Nokia by basically saying, “we do not mind taking a stock Windows Phone Lumia 710.” It is likely that no other carrier is going to sell the Lumia 710, so that is differentiation in and of itself. But AT&T was not having any of it. The Lumia 900 is what Nokia delivered and it is different from not just T-Mobile’s 710, but also the Lumia 800 that most of Europe got. Verizon will likely take something akin to the 900, but it will not want it to be exactly the same thing that AT&T got. Nokia is willing to play this game because it does not have much of a choice. Samsung set the precedent with the carriers and Nokia does not have the U.S. clout or the hype of Apple’s iPhone to defy what the carriers’ want.
Apple is the one OEM that stands outside of all these politics. The smartphone revolution was started when Apple released the original iPhone. It was such a revelation that it has become a symbol as much as a smartphone. Apple can dictate terms whereas the other OEMs cannot. It would be interesting to go back into a deviant version of history and replace Apple with Motorola or some other OEM and see if Apple’s strategy remained the same or if it would be forced to carrier whims.
The gatekeepers set the terms. Until a real alternative is created and realistically implemented, this is the way the mobile industry in the U.S. will continue into the future. Outside of Apple and Google creating their own data networks, terms will be set by Verizon, AT&T, T-Mobile and Sprint for years to come.