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Mar 20, 2008 | By iPhoneChris | Tags: , ,

Update: I wrote this article March 2008 and I am now wondering if some iPhone 3.0 features will cause iPhone app developers to lose their businesses. Developers, if you are concerned about Apple’s new features competing with your apps, I would like to know about it.

I have a serious concern about the upcoming iPhone App Store that no one has addressed yet:

What happens when Apple issues an iPhone firmware update introducing features from a 3rd-party iPhone application in the App Store?

For example: let’s say a developer lists a Voice Dialing application in the App Store in June, and in July Apple issues an iPhone firmware update featuring voice dial functionality.

Or consider these other possibilities:

  • A developer solves the iPhone’s text message privacy issue by creating an app that gives you SMS privacy options, and then Apple amends the iPhone settings to allow you those same options
  • AOL develops an iPhone AIM client, and then Apple issues an iPhone update featuring an iChat app
  • Someone lists an iPhone app that lets you search the contents of your iPhone, and then Apple updates the iPhone with a similar Find function

Can you foresee the conflicts that would arise in situations like these?

Will Apple be willing to compete with — or put out of business — its third-party iPhone app developers? Imagine the bad publicity the company will endure when these kinds of scenarios arise.

And it seems likely to me that such scenarios will arise, given that Apple is constantly updating the iPhone with new features, some of which are bound to coincide with applications in the App Store.

There are plenty of things wrong with the iPhone, and once the App Store launches in June, developers will seek to solve the iPhone’s problems and make a profit by doing so.

The problem is that Apple too will continue to improve the iPhone and address the same issues that developers are tackling, so there will almost certainly be clashes between Apple and iPhone app developers.

And I’m betting that each time this happens, the developer who is negatively affected by an iPhone update will accuse Apple of stealing his idea and taking away his business.

Though I’m sure Apple reserves the right to issue whatever new iPhone features it wants, situations like these could hurt developers in several ways:

  • The most obvious side effect for developers will be the immediate loss of income, since iPhone users will not buy an app that Apple has already given to them for free via a firmware update.
  • What’s worse, it takes time and perhaps money to develop an iPhone app. These could be wasted investments without an assurance that Apple will keep its hands off your ideas.
  • Developers pay $99 for the privilege of listing their apps in the App Store. If Apple puts a developer out of business by taking her idea, this application fee is just salt in the wound.

What to do then?

Has Apple considered how it will handle iPhone updates that tout features that have already been listed in the App Store?

Will they somehow compensate developers whose ideas they “borrow”? I doubt it. Although this might appease some developers, not everyone will agree on what is adequate compensation, and such a practice would be unsustainable.

Or will they respect developers and avoid introducing features that have already been introduced via the App Store?

The question remains: Is it worth it for developers to invest time and money into an iPhone app if Apple could issue a similar app in an iPhone update at any moment?

Should we expect some kind of assurance from Apple that these conflicts with developers won’t occur? What do you think?


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5 Comments

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  1. iPhoneChris (218 comments) says:

    Yes, Simon, but by including apps in iPhone 3.0 that compete with apps that developers rely on for income, Apple may be hurting its own independent developers. The new Voice Memo feature will compete with more than a handful of apps now in the App Store. How will Apple reconcile this?

  2. Simon (4 comments) says:

    This is how things go, and it’s natural. You can’t tell Apple not to put features in just because a competitor already had those. Think about Mac apps: iTunes, Safari, Spaces, etc already had a commercial equivalent when Apple released them. In the long term, it’s better for the end user.

  3. iPhone Hub (6 comments) says:

    This is what a capitalistic country is all about. Find gaps, fill them and monetize it. As far as I can tell, it would be a huge error on Apple’s side if 2.0 is indeed the last update.

  4. aly (2 comments) says:

    apples 2.0 update will be the last one so theres nothing to worry about

  5. iPhoneChris (218 comments) says:

    Where did you hear the iPhone 2.0 update would be the last one, Aly?

    The Apple press release says, “Apple plans to release the final iPhone 2.0 software … by the end of June,” but I took that to mean the final version of that particular software, since it is in beta right now.

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