By: Hillel Fuld
I had the privilege of having an hour long conversation with Patrick Mork, CMO of the Web’s largest independent app store GetJar yesterday, and I think it is safe to say, I learned a heck of a lot. As you probably noticed, all my previous interviews were done via email so I was able to quote the person precisely. This interview was done over the phone (not even Skype), so I will be paraphrasing the answers Patrick gave me to my questions.
I am sure by now I do not need to tell you how big the “app business” is, but just to put things in perspective, overall app revenue is estimated to grow to $17 billion in 2011. GetJar is a leading brand along with the App Store, the App Market, the App World, and as you will see later in the interview, a handful of other independent app stores like Mobango and Handango.
Talking to Patrick was a real pleasure and as I told him at the end of the call, I intend on picking his brain about the mobile space in the future. He very graciously accepted my request. So here are the questions I asked Patrick and the answers as I understood them (and he approved before I published):
1. Please tell me and my readers about yourself.
Originally from Belgium, Patrick worked for Pepsi and the mobile gaming company Glu before joining Getjar. He joined Getjar two and a half years ago when there were 8 employees. The company is now up to 65.
2. How did GetJar come to be?
GetJar actually started out in a completely different space providing developers with a beta testing platform for their apps. You would join Getjar to upload your apps, test others’ apps and communicate with other developers. The site was started in 2005 for the Java platform and when Symbian was getting started. Getjar, in its original model, had 150,000 downloads in its first month on the Web.
Once developers and the founders saw its success, they decided to take all the data and apps they had hosted on the site and add a distribution platform on the existing site to become an independent app store. The rest is history.
3. Is GetJar officially the biggest app store on the Web?
That really depends on your parameters, some other stores claim to have more apps than us, but our downloads speak for themselves. Over 1.6 billion downloads to date, 75,000 apps, and support for more than 2,500 mobile devices. Some might say that Mobango and Pocketgear who recently bought Handango are Getjar’s biggest competitors, but with different business models, Getjar has no real direct competitors.
4. What is the GetJar business model?
Getjar is free for the user to access and download apps. The revenue comes from a very interesting model, which is very similar to Google AdWords. Developers can run campaigns on Getjar to target certain geographical locations and certain devices. The developer bids on the placing, and only pays once the user downloads the app. It is completely performance based.
5. What does the future hold for independent app stores?
In one word, consolidation. There is no room in the market for hundreds of app stores, it is not scalable or sustainable. Consumers will eventually choose their app store based on exposure and discovery. Only a few app stores will remain and the rest will get swallowed up. In addition, mobile will follow the trends of the Web both in terms of a few dominant players taking over and in terms of openness.
The open model will eventually prevail and closed app stores like Apple’s will have to adapt. It is already starting with open app stores like Getjar surpassing any one provider in terms of downloads.
6. What will be the outcome in the battle of the OSs?
Contrary to the impression one might get from the buzz, the battle of the OSs is a long one and is not going to be determined today or tomorrow. Some things we can expect to see is that iOS will continue to be dominant, but in Patrick’s opinion, the iPhone has already reached its peak in terms of market share, while Android will continue in an upward graph. Apple is dominant because of its superior eco system and developer community.
iPad will continue to grow but iPhone will remain relatively static when it comes to market share. The one to watch in this space is Android, something Patrick and Getjar predicted over a year ago, when people were still pessimistic of the Android model. Android’s main challenge is monetization of apps and distribution. Fragmentation in the Android OS causes both users and developers major problems and they are going to need to fix this soon.
In terms of monetization, the numbers show that more people are willing to pay for iOS apps than Android ones. The reason being that iTunes’ one click billing solution is convenient and seamless, while Android makes it difficult for developers to charge for their apps on a global scale. Everyone talks about Android being open, but in reality, many aspects of the Android platform are in fact closed, such as the billing. If you do not have Google Checkout for example, you cannot charge for apps and Google Checkout has been deemed a failure.
Another aspect of how Android is in fact closed is that certain providers do not allow Android users to download and install Android apps from 3rd party stores, like Getjar. AT&T subscribers for example, cannot install Getjar apps on their Android phones. (Did you know that? I didn’t!)
7. What are your thoughts on mobile advertising?
Patrick has been a fan of in app advertising back before it was a popular method of monetization. It is an effective method of generating app revenue from mobile apps, but the big down side is that in order to make significant revenue according to Patrick, developers need serious traction. This is especially true in emerging markets where the eCPM (what the developer makes for every one thousand impressions) is particularly low. Mobile advertising is a big space that will only continue to grow.
At this point, I talked to Patrick a little about my new job at inneractive, a company that optimizes over 60 ad networks to offer developers an effective way to monetize their apps on all mobile platforms. Patrick will be meeting us in Barcelona next month in the Mobile World Congress.
8. What is the best monetization model for app developers?
Patrick pointed out that there are two main models for monetizing apps. The first one is ad funded as mentioned above and under certain circumstances, can be very effective. As I mentioned, the main weakness is emerging markets since developers need more traction to make real revenue there. The other model is in app purchases. Patrick gave me the example of a mobile game in which you have to kill a monster but the sword you are given for free is not sufficient, so you are offered to upgrade the sword for $.05. Patrick says users are willing to pay small amounts especially in games, so this model is expected to become extremely successful in the mobile gaming space. Patrick is not a fan of the freemium model for mobile apps as he things it is not as effective as the other options.
9. What are five tips you would give a developer just getting started?
- Know your audience: Do market research, know who your target audience is,what their habits are and what phones they are using.
- Cross platform: There are many platforms besides iOS and Android, a cross platform strategy is sure to bring more downloads.
- Multiple revenue streams: Design your apps so you can experiment with different models of monetization. Experiment and see what works best for you. That is why companies like Tapulous are so successful. Tap Tap Revenge has three or more revenue streams such as selling music and in app purchases.
- Wide distribution: The days of launching an app on the App Store or Market and making millions overnight, are over. You need to launch your app on various channels including independent app stores if you want to reach critical mass. Otherwise, it will fail with all the competition out there.
- Social: Social media is very important when it comes to marketing your app. Make noise, after all, a good product is only half the battle.
10. How did you land an exclusive with the wildly popular Angry Birds for Android? How did it go down?
Speaking of launching on Getjar, I had to know how they managed to get Angry Birds to launch exclusively on Getjar. Patrick told me that the founder of Getjar, Ilja Laurs knows Peter, the Mighty Eagle of Rovio, Peter Vesterbacka, from Finland. When Patrick and Peter ran into each other at CTIA, they sat down for coffee. Peter was talking about how he was upset with Google because he was about to launch Angry Birds on Android, but the “Android guys” were not answering his calls. Patrick explained that Peter than looked up and said “How about we launch it exclusively on Getjar”?
Patrick of course accepted and Getjar obviously made a lot of PR noise about the launch. When the birds did eventually launch on Getjar, the site’s traffic increased 12x within the hour and the servers eventually crashed for a few hours. Within the first day, there were a million downloads of Angry Birds, and the game continues to perform phenomenally well. Patrick said that as far as he knows, Rovio is making as much from the ad funded Android game as they are from the paid iPhone version of Angry Birds but he said for more numbers, I would have to speak to Peter.
Since the launch of Angry Birds on Getjar, the site has launched a new program for highly successful apps. The program is called Getjar Plus and it has since launched titles with Zynga, Mafia Wars, Digital Chocolate and many others.
11. What are your thoughts on today’s announcements, namely The Daily for iPad and the Android Web store?
Patrick was not very impressed or excited about either of these announcements. He said that we knew about The Daily for some time and it will probably do “ok”, but not sure it will save the newspaper industry, especially with the small number of iPads on the market, relatively speaking. It is also too early to know how well it will do when it comes to profitability. As for the Google Web store, Patrick said he was baffled how Google launched the Market in the first place without a Web UI.
In today’s day and age, this is a must. The Web store is long overdue. At this point, I asked Patrick about Apple not having a Web store and he answered me “Apple is Apple”. They have a very strong consumer brand and are experts at retail, Google isn’t and could not afford to not have a Web store. Apple should not have either, but at least they have their consumer brand.
As you noticed, I asked some pretty difficult questions. I was sure I would get at least one “I cannot disclose that information” answer, but it never came. Patrick was really open and nice to talk to, for that I thank him.
I hope you enjoyed the interview as much as I did, and as usual, I would love to hear your comments, so leave them below or hit me up on Twitter.