The Storefront: Apple Opens the App Economy

There is an announcement this week, and the announcement is the store: the event at Apple's Cupertino headquarters on Thursday, the iPhone SDK that was unveiled, the Application Store promised for the next software release. The announcement is the reversal: the company that said web apps were enough, the company that opens the device to developers. The announcement is the plan: the 70 percent that developers keep, the store that will sell the applications. The storefront is the March 2008 story, and the story is the lesson: the phone that becomes a marketplace, the developers who become the sellers, the economy that begins this week.

The Storefront is the subject of this article: what Apple announced on Thursday, why it reversed course, how the store will work, and what the platform means.

1. The Event at Cupertino

The event is the stage, and the stage is Cupertino: the headquarters that hosted the announcement on Thursday, March 6, the room that filled with developers and journalists, the iPhone that sat at the center of it all. The event is the reveal: the iPhone SDK that was announced, the kit that gives outside programmers the tools to build native applications, the store that will distribute them, the software release that will carry the store to every iPhone. The event is the moment: the demos that were shown, the games that ran, the enterprise tools that appeared, the crowd that understood.

The event is the message: the iPhone that is no longer a closed appliance, the developers who are invited in, the software that will come, the sales that will flow through Apple. The event is the meaning: the company that spent 2007 saying the browser was enough, the company that now hands the keys to the ecosystem, the reversal that came. The event is the signal: the hardware maker that becomes a platform owner, the platform owner that becomes a merchant, the merchant that takes a cut of every sale. The event was the opening, and the opening was the platform.

2. The Reversal on Web Apps

The reversal is the story, and the story is the change: the iPhone that launched on June 29, 2007 with no native software from outside developers, the Steve Jobs who said web applications were enough, the browser that was meant to carry the burden. The reversal is the early 2008 turn: the jailbreak community that opened the device, the developers who demanded more, the demand that could not be ignored. The reversal is the admission: the web apps that were fine for the beginning, the native apps that are needed for the future, the two approaches that will coexist on the same phone.

The reversal is the pressure: the developer demand that built through the fall, the jailbreak scene that showed the hardware, the customers who wanted more. The reversal is the strategic read: the phone that sells in the millions, the software that could sell in the millions more, the store that turns developers into a sales force. The reversal is the lesson: the product that becomes a platform, the platform that becomes the business, the web apps that were the first answer, the native apps that are the final one. The reversal was the pivot, and the pivot was the announcement.

3. The SDK

The SDK is the tool, and the tool is the door: the development kit that Apple released to the world on Thursday, the kit that is free to download, the kit that turns any programmer into an iPhone developer. The SDK is the access: the frameworks that expose the iPhone to code, the interfaces that were kept secret, the accelerometer and the touch screen that are now available to anyone, the APIs that open the hardware. The SDK is the invitation: the developer who downloads it tonight, the app that is written in a garage, the company that grows from a hobby.

The SDK is the quality bar: the native code that runs faster than the browser page, the games that use the accelerometer, the enterprise applications that need the real APIs. The SDK is the March 2008 promise: the development that happens on Apple's terms, the store that Apple operates, the platform that stays in Apple's hands, the sales that flow through the store. The SDK is the ecosystem math: the free tools that lower the barrier, the developers who will enter, the applications that will multiply, the value created outside Cupertino. The SDK was the key, and the key was handed over.

4. The App Store

The store is the announcement, and the announcement is the plan: the Application Store that will go on every iPhone in the next software release, the store that Apple described on Thursday, the distribution channel that has never existed on a phone before. The store is the software release: the iPhone OS 2.0 that will carry the store to every device, the update that is coming, the store that will be waiting when it does. The store is the mechanism: the applications that are listed, the prices that are set, the purchases that are made, the downloads that are delivered.

The store is the payment platform: the billing that is built in, the purchases that happen in one tap, the merchant that Apple now becomes. The store is the 70/30 split: the developer who keeps 70 percent of every sale, the 30 percent that Apple takes, the economics that make the store the toll booth of the new economy. The store is the question: the applications that will come, the quality that must be kept, the store that will decide what the iPhone can do. The store was the headline on Thursday, and the headline was the future of the phone.

5. The Demos

The demos are the proof, and the proof is the screen: the SEGA game that was shown on stage, the Super Monkey Ball that used the accelerometer, the ball that rolled as the phone tilted, the crowd that laughed and watched. The demos are the demonstration: the games that ran at full speed, the enterprise applications that showed the business case, the software that was not a mockup, the code that was real. The demos are the Thursday image: the developers who stood at the podium, the applications that worked, the platform that was not a promise but a product.

The demos are the strategy: the games that sell the phones, the enterprise apps that sell to the companies, the developers who bring both, the variety that fills the store. The demos are the March 2008 statement: the iPhone that is a gaming device, a business tool, a platform, and a storefront all at once, the phone that replaces the categories. The demos are the glimpse: the Super Monkey Ball that shows what the accelerometer can do, the applications that will follow, the ideas that the SDK will unlock. The demos were the proof, and the proof was the pitch.

6. The Developer Program

The program is the business, and the business is the gate: the iPhone Developer Program that Apple announced, the 99 dollars a year that developers will pay, the entry fee that separates the serious from the curious. The program is the structure: the developers who enroll, the applications that are submitted for the store, the rules that Apple sets and enforces. The program is the contract: the developer who builds on Apple's platform, the developer who sells through Apple's store, the developer who pays Apple for the privilege, the 70 percent that comes back, the 30 percent that Apple keeps.

The program is the signal: the platform that is serious, the commitment that is financial and real, the developers who will build for it, the store that runs as a business. The program is the math: the 99 dollars a year, the applications that come, the sales that flow, the 70 percent that returns to the developer. The program is the new distribution: the developers who no longer need a publisher, the developers who no longer need a carrier deal, the developers who need only the SDK and an idea. The program was the gate, and the gate was the store.

7. The Platform War

The war is the context, and the context is the industry: the Nokia that dominates the world market, the Microsoft that rules the enterprise, the RIM that owns the business email, the Apple that enters with a new model. The war is the mobile moment: the operating systems that are locked down, the carriers that control the phones, the developers who have no channel, the store that changes the terms, the developers who will choose. The war is the March 2008 field: the iPhone that is young, the rivals that are entrenched, the platform that Apple builds against the giants.

The war is the stakes: the smartphone market that is growing, the software that decides which phone wins, the store that could be the decisive weapon. The war is the Apple argument: the iPhone that becomes a platform, not just a product, the platform that attracts the developers, the developers who attract the customers, the customers who attract the developers. The war is the 2008 lesson: the mobile platforms that are fighting for the future, the Apple that is now a contender, the store that is the opening move. The platform war was the stage, and the stage was the store.

8. The Lesson

The lesson is the platform, and the platform is the change: the phone that was a product in 2007, the phone that becomes a platform in 2008, the difference that the SDK and the store make. The lesson is the economics: the 70/30 split that pays the developers, the store that collects the money, the applications that become a business, the app economy that begins with this announcement. The lesson is the sequence: the announcement on Thursday, the SDK that is available now, the release that is coming, the store that will open, the developers who are already at work.

The lesson is the perspective: the storefront that opens the app economy, the economy that begins in March 2008, the industry that will be measured before and after this week, the developers who will remember the very day it was announced. The lesson is the March 2008 story, and the story is the lesson: the event at Cupertino, the SDK that was handed out, the store that was promised, the 70 percent that belongs to the developers, the platform that is now open. The storefront is the beginning, and the beginning is the story that will be told for years.

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