O2 follows T-Mobile in launching app store

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O2 follows T-Mobile in launching app store

By CAROLINE GABRIEL

Published: 12 November, 2008

READ MORE: O2 | T-Mobile | App Store

Despite its co-dependent relationship with the iPhone, O2 UK plans to launch its own developer community and app store next year, which could put non-Apple handsets in a better position to compete with the iPhone and its App Store.

The project, called Litmus, will offer developers virtual access to 40-plus handsets in the O2 portfolio (not the iPhone of course). They will be able to develop, trial and monitor applications to run across some or all of the phones, improving the efficiency of their efforts, and they will also be able to sell apps and content online or over the air. This looks similar to T-Mobile USA's plan to create its own software store, allowing developers and consumers to work across all its high end and midrange phones, rather than targeting each one separately.

The two initiatives show another way that European cellcos, in particular, are looking to establish a strong position in the mobile web value chain, by creating a single source for mobile content that is associated with their brand and network, rather than a phonemaker's or internet player's platform. This will not only help them attract and retain high value, web savvy consumers, but should enable them to command a better slice of the revenue pie.

Speaking at the Mobile 2.0 conference in San Francisco, O2's head of product development, James Parton, said that Litmus will offer developers the tools to work collaboratively with selected customers in a live virtual laboratory, so that community members can build on one another's ideas and pool skills and experience. They will also be able to trial important parts of the O2 infrastructure, like messaging or billing systems.

Although Litmus seems to be envisaged mainly as a testbed at first, to encourage the creation of new applications for the O2 network and devices, it should quickly evolve into a fully blown store to compete with App Store, Android Market and others.

Apple's store, despite popularity with consumers, is still criticized by some programmers for being over-controlled and mean with the revenue split so there is still an opportunity for operators to outshine it (T-Mobile USA will offer 70% of revenue to developers when it opens its devPartner Community Store next year. The advantage large cellcos will have over Apple is their market reach. T-Mobile has 30m subscribers in the US alone, three times the number of iPhones that are expected to be in use by the end of this year.

AT&T is also said to be investigating the creation of a store for apps geared to midrange handsets rather than smartphones, following a move to standardize all its sub-smartphone handsets on a single, unspecified operating system, likely to be Linux/Java-based.