

How Apple gave up on web apps – to make more money with iCloud - ivanbrezakbrkan
http://www.domain.me/blog/icloud-how-apple-gave-up-on-web-apps-1503/
You have to remember that iCloud isn’t Apple’s way of entering the web application market, but actually a measure of ensuring the future of their own ecosystem. Apple doesn’t want to make web apps, they want their developers to make more money creating apps for the iPhone, iPad and Mac.
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bradleyland
Apple's view of the web is a little different than most. When you think of
today's internet, you think of web pages, but there's a whole other layer. If
you look at web development trends, you'll see that the tools we have (like
HTTP) are being pushed to do things they weren't originally designed to do.
Starting with the first use of HttpRequestXmlResponse, web developers pushed
HTTP down a conceptual layer. HTTP used to be the destination. Content was
pushed, in whole, using HTTP. Javascript enabled web browsers give us the
power to use HTTP as an underlying transport. With these tools, the balance of
our app moved back in to the browser. This ideology is pretty well expressed
in pieces espousing the virtues of the "Javascript Age".

The browser, enabled by javascript, has become a platform in and of itself.
This pushed the OS down a conceptual layer as well. Google is embracing this
model because they live on the web. Apple is fighting this model, because they
live in the hardware and OS market.

Apple sees the internet as a ubiquitous transport. They're building an
ecosystem of "things", just like Google, only Apple's "things" are iOS
devices, where Google's "things" are websites.

Android is Google's hedge against Apple's platform. It exists primarily as a
countermeasure. If Google believed in Apple's view of the internet -- where
devices are king -- they'd have much stronger ownership of the entire Android
platform. In short, they'd go vertical as well. They've made some small plays
in that direction (Nexus phones), but they're not seriously committed to it.

The great part is, we get to watch this battle unfold. I don't particularly
care which one wins. I think both perspectives have merit, because I don't buy
in to the many "principle" arguments that push matters one way or the other.
Never forget, there's money to be made on both sides of the table.

~~~
dreamdu5t
Google and Apple are _not_ competing, especially to the degree that you imply.

You can use gmail on your Macbook, and many do. You can click on AdSense on
your Macbook, and many do. Google doesn't need to compete with Apple directly,
or even capture their market for hardware. As long as Apple users browse the
web, Google is fine.

There is no "battle" unless Apple got into advertising.

~~~
panacea
Like iAd?

~~~
fonosip
interestingly iAds have been a huge disapointment. they could not reach
critical mass of advertisers. And by Job's comment yesterday against ads on
iCloud, it looks like they gave up on it

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PanMan
Apple doesn't make that much money directly on the app ecosystem: If they paid
2.5 billion to developers (70%), their revenue is about 1 billion (the
remaining 30%). For that billon they have to host all apps (also the free
ones), manually check all submissions (400.000 apps Excluding upgrades!), and
process payments.

Apple is making more on iPad covers this year alone.

However, the app ecosystem is a great lockin for users to keep using iOS
instead of other mobile platforms. That's their biggest gain, and with iCloud
they embiggen this platform lockin.

~~~
watty
Do you have a source? I'm not saying you're wrong but it seems crazy that
Apple makes more revenue off of iPad covers than all of the app market.

~~~
xuki
25 million iPad have been sold. Say 30% of them (with the iPad 2 I see more
people bought the Smart Cover though) bought Apple's covers, that's about 8.5
million. Accessories' margin is high, let's assume they make $30 per cover.
That's $255 million _profit_. I seriously doubt Apple could break even for the
App Store alone (the huge review team and infrastructure cost).

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isleyaardvark
> Just follow the money. Now lets remember where Apple makes their money and
> why they paid over $2.5 billion to developers… Revenue for mobile app
> markets is on the rise. Apple wants their users to buy apps that have the
> advantages of web apps

If you follow the money you find $1.8 billion in revenue from the App Store
(2010), which would be _2%_ of the $87 billion revenue Apple has earned in the
past 12 months.

Sources: [http://www.engadget.com/2011/02/18/apple-maintains-lead-
in-m...](http://www.engadget.com/2011/02/18/apple-maintains-lead-in-mobile-
app-store-revenues-but-its-share/)

<http://finance.yahoo.com/q/ks?s=AAPL>

This thesis pops up every couple of months, and it's always ridiculous.

~~~
xuki
You're not getting his point. He's saying Apple wants customers to buy apps to
be locked-in.

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YooLi
Is Apple making MobileMe web mail look like the desktop app really an
indication that it doesn't know how to make a web app?

Where does the "Apple doesn't know the web" idea coming from? I've heard
"Apple doesn't know social" because of their stumbles with social in the past,
likewise with Google, but Apple not knowing the web makes no sense to me. The
last place I saw it was saying Apple didn't know the web because their designs
were "pixel-perfect" and beautiful. That's two people saying it because the
web apps look nice??

What does it take to "know the web"? So iCloud doesnt have a web interface.
Who says one still isnt coming. Judging by everything else in the keynote, it
won't look like tradition cloud storage, a la Dropbox. Apple is abstracting
away the filesystem. It will probably show you the apps you have that include
iCloud support and the files each uses.

~~~
MatthewPhillips
Apple doesn't have a single web service now that MobileMe is gone. Whether
they don't "get" the web or they get it and just choose to ignore it is
splitting hairs.

~~~
chc
The failure of MobileMe strongly suggests the former. If Apple didn't care
about the Web, they could have not made a product in that area just like they
do with all the other things they don't care about.

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zipdog
Apple understands that one of the core benefits that they give to consumers is
consistency. The PC world is wildly inconsistent, while iOS provides enormous
consistency - I can pick up any device and apps will function the same. This
is really the goal of demoting the PC and the Mac.

Its akin to Facebook's garden vs MySpace's wild forest. Web apps simply can't
provide the kind of consistency that most users want. In the battle between
Linux and Windows, the freedom of Linux to allow the user complete control has
not been a selling point for most users.

Apple knows this and knows that a controlled garden of iOS apps will be
preferable for most people, compared to web apps (particularly with the
browser standards starting to slip again)

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tpatke
The author hints at good point - is the browser going to be around in 10
years? The trend definitely seems to be cloud + rich client. In that case, is
the browser needed?

~~~
hxa7241
Is the browser needed from a technical or usable perspective? I do not know,
but it seems difficult to separate that from the economic-architectural
aspect, which really seems important.

The browser is 'needed', is valuable, because it is an independent, unowned
'medium' for other products and activity. It allows something more like real
competition. That independence is part of the open architecture of the
internet that is probably what makes it all so great.

. . . and what would an _independent_ rich-client look like? Would that not be
a browser pretty much? . . .

~~~
sunchild
"Browser" itself is an inherently vague concept. Is iTunes as it exists today
a browser? How about Twitter clients that render HTML/JS?

When you isolate WebKit and the other rendering engines as OS-level services,
it's even fuzzier.

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zmitri
One of the main differentiators of price for Apple products is the disk size
-- in fact, for iPads and iPods, its the main differentiator. They want to
push to all of your devices, because they want you to use up your storage and
pay the $100 to $300 markup between model A and model B. If everything was
accessible from the web and it used smart caching like spotify or google,
there would be much less need for bigger hard drives.

~~~
MatthewPhillips
Cloud storage makes hard drive size largely irrelevant.

~~~
glhaynes
Much moreso in a streaming model. In a "download at will" model like iCloud,
having more storage certainly makes things more convenient. But, yes, still
less relevant, for sure.

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Yhippa
This makes sense. Give a huge incentive for users of Apple's products to
continue to buy their devices and get further ingrained into their ecosystem
while getting that desirable vendor lock-in.

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snissn
This is why they acquired lala.com, right..? </cynicism>

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davidedicillo
And what would be the problem with a business trying to be more profitable
giving away something free (like iCloud)?

I'm sure Google is offering all their services because they are very nice
people, not to make more money off the ads.

~~~
ivanbrezakbrkan
Well, giving something away for free is not a bad business move (Facebook's
free ;)), but do you really think that Google just makes their services free
because they're nice? A business like any other, they just make $$$ of us in a
more indirect business model.

~~~
davidedicillo
Oh my god, did you really didn't understand that I was sarcastic? That was my
point, I felt that in the article there was a negative angle about Apple
trying to make more money and I just wanted to point out that the nemesis of
Apple, Google, who is trying to bring everything online, does that for the
same exact reason, to make more money.

~~~
ivanbrezakbrkan
Sorry. Hard to say without a smiley since it woudn't be the first time someone
argue that Google is just good and nothing else

