Jeff is really talking about a very specific kind of app: one that provides an interface to a web service, and that has (or could have) a comparable service accessible through a browser.
There are a lot of apps that make the bulk of the "millions of apps" that do not fit this description: games, productivity apps, apps making use of mobile hardware (microphone, camera), that couldn't possibly have web alternatives.
It's totally true that App stores have pricing/quality/discovery problems, but I'm not sure that there is a duality with the web (which could be resolved by "product x"), just an intersection.
There are a lot of apps that make the bulk of the "millions of apps" that do not fit this description: games, productivity apps, apps making use of mobile hardware (microphone, camera), that couldn't possibly have web alternatives.
It's totally true that App stores have pricing/quality/discovery problems, but I'm not sure that there is a duality with the web (which could be resolved by "product x"), just an intersection.