By Allan Maurer

WASHINGTON, DC – While some venture capitalists are skeptical about making mobile apps a sustainable business, others are throwing money at iPhone and iPad pure plays. DC-based mobile expert Ken Yarmosh tells us that there is plenty of money to be made in the mobile app space whether VCs grab a piece or not.

“There are a number of successes and they’re not just one-offs,” says Yarmosh, who notes that the most successful are game or entertainment oriented.

He says the smartest angle for VCs to pursue is probably to invest in platform plays rather than just in apps themselves. “But there is plenty of money to be made by individuals and companies,” he says.

Yarmosh authored the book App Savvy: Turning Ideas into iPhone and iPad Apps Customers Really Want, for O’Reilly, and is a product strategist focused on mobile apps. He helps clients develop Android, iPhone and iPad apps and maintains a blog at KenYarmosh.com.

Yarmosh is one of more than 50 Internet, mobile, and digital business experts who will converge on Tysons Corner Oct. 18 for the first Digital East event.

Some big success stories

Yarmosh says about mobile app development, “We’re not talking about making hundreds of millions here. Is there a Google on iPhone or iPad? I don’t think so. But it doesn’t have to be that. For an individual, I’d take a couple million from a single game.”

If you look at the games sector, for instance, “There are some super success stories,” he says. “The best game developers are making $3 million or $4 million from top games. Look at Doodlejump. It was created by two brothers who are splitting a couple million, so it’s been pretty lucrative.”

According to Wikipedia, On June 25, 2010 it was announced that Doodlejump had totaled over 5 million sales. It has been reported of having 28,000 downloads per day.

Mobile differs from the web

Mobile is a different space than the web in one very distinct and notable way, he says. “On the web, even the most successful sites have had a hard time figuring out how to monetize.”

In the mobile world, however, paying for apps is fairly standard and free is not the name of the game.

One advantage of making mobile apps is that Google’s Android store and Apple’s App Store does much of the business logistics and marketing for the makers. “The Apple iTunes store has 150 million credit cards on file,” he notes.

Google may be a bit behind, “But they’ll be making a big push on that in the next couple of months,” Yarmosh says.

Mobile still a moving target

Existing brands making mobile apps as another channel to their products and services have done well, but not every brand or company needs a mobile app, Yarmosh says.

Many, however, are approaching him for advice on what to do this year to prepare for 2011.

“They’re looking at this year and asking how will it lead me into next year,” he says. Some firms are willing to throw some money at mobile this year, but don’t really expect much to start happening until 2011.

“Mobile is such a moving target this year,” he explains. “Tablet devices have been touted for some time as the ‘Next Big Thing,’ but didn’t really materialize until Apple introduced the iPad.”

Android device makers are very active and is surpassing Apple in the number of devices using the Google operating system and shipping daily.

So, he says, “People are just trying to keep up with what’s happening. They’re not sure if things will change drastically again this year. They want to be leaders, but they don’t want to over or under invest in something they don’t completely understand.”

Yarmosh says he sees a lot of indications that tablet computing and apps are becoming important this year. “I have my iPad with me in every meeting and that’s the only thing they’ll want to talk about.”

Big opportunity for Android

He says he’s particularly interested in seeing how the Android space plays out, because it allows a lot more customization than the iPad. “You can control some operating system elements.”

That means some businesses will find Android devices more compatible with their needs to customize certain elements than the Apple tablet.

“There’s a big opportunity for Android in Enterprise apps,” he says. “I don’t think it will become a huge gaming platform. Apple always leads with consumer apps.”

An additional issue affecting the use of iPhones is its limit to one carrier (AT&T), he adds. “More choice is always better,” he says and thinks it’s only a matter of time before Apple expands that option.

“If I were AT&T, I’d be offering Apple buckets of money to keep that contract,” he says.

Yarmosh himself carries both a Nexus One Android device and an iPhone4 currently.

He has some highly relevant advice for mobile app and mobile device makers, which we’ll look at in part two of this interview next week on TechJournal South.

To contact TechJournal South Editor & Writer Allan Maurer: Allan at TechJournalSouth dot com.

 

Southeast Venture Conference, February 29 – March 1, 2012 at the Ritz Carlton in Tysons Corner, VA – Where Smart Money Meets Smart People.
www.seventure.org

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Tags: Android, AT&T, Digital East, Doodlejump, iPad, iPhone, iPhone4, Ken Yarmosh, mobile apps, mobile games