There can be no doubt that the mobile app store market is a crowded one, with a number of established incumbents being joined by new challengers, and with initiatives such as WAC set to change the picture further. The big question is: how does one differentiate?

Certainly in recent months there has been something of a numbers game going on. In terms of apps available, Apple has a clear market leadership, followed by Google’s Android Market and GetJar, with BlackBerry App World and Ovi Store some way behind. In terms of app downloads, the picture is similar, with Apple and GetJar topping the charts. As for revenue, it is anybody’s guess, although sheer volume would appear to give Apple the edge.

This focus on numbers makes life especially difficult for new players to the game. Compared with its rivals, the 2,000 apps available from Microsoft’s Windows Marketplace for Mobile appears poor, and the lack of handsets in the pockets of customers means that download numbers are likely to be similarly unimpressive. But this ignores the fact that the company reached 2,000 from a standing start before handsets had even become available, which is a not inconsiderable achievement – although it seems unlikely that this could have been achieved without the might of Microsoft behind the efforts.

This creates a real challenge for anyone else looking to capitalise on the mobile app store boom, including mobile operators – there has yet to be an operator store that has achieved the same high-profile success exhibited by vendor or platform stores. In order to attract users, a store needs apps, and in order to attract app developers, a store needs users. And with the momentum already focused around a number of existing propositions, creating this circle of supply and demand is challenging in the least – take the effort Nokia and Microsoft have put in to their respective efforts as an example.

At last week’s GSMA Mobile Asia Congress, Han Kotterman, chief strategy officer of Hong Kong operator CSL, had some ideas. “One of the areas that we focus on in particular is content localisation and personalisation, and I think that if there’s one thing we can do slightly better than many of the larger players, it is making sure that the content and the applications are relevant to the local user. We will not be able to compete with the Googles and the Apples on mass applications. It’s simply not feasible. But we will be able to give additional strength when we look at localised content.”

Certainly there does appear to be a different picture emerging on a regional basis, for example with different players leading the way in China than the rest of the world. But then this does reflect the somewhat unique characteristics of this market, what with the size of the addressable customer base – there is unlikely to be the same level of interest in creating products specifically for Mongolia or Moldova.

There is a possibility that the opposite of the numbers game may make some sense, for those with a well-established market niche. For example, if an existing healthcare or travel brand decided to offer healthcare or travel apps from their online store, the total number of products would not matter – as long as they could offer the best portfolio of targeted products to their users. This kind of specialist interest site also has the advantage of having an engaged user base, and could conceivably offer products at a higher price, benefiting from their existing specialist position and the fact that they do not have the same problems when it comes to making products stand-out from the app-store pack.

As WAC comes on-line and operators and vendors refresh their app portfolios, it will be interesting to see how the various participants look to differentiate themselves in “stage two” of the app store game…

Steve Costello

The editorial views expressed in this article are solely those of the author(s) and will not necessarily reflect the views of the GSMA, its Members or Associate Members