Analysis: HipLogic – Carphone Warehouse content partnership

I am posting this blog as an opportunity to create a discussion around the positioning of appstores.

I spent a lot of time writing this blog and I am interested in feedback to my analysis here which is in a nutshell: In my view, appstores do not provide differentiation in themselves and hence the hiplogic strategy of appstore + apps + social networks + CRM may have some merit but with some caveats

Background

For some time now, I have been involved in strategically understanding the Appstore phenomenon. For example, I project managed the initial gap analysis of what was then OMTP BONDI and which is today incorporated into WAC

Leaving aside all the hype around appstores, you could view appstores from three perspectives:

Providers: Appstores convert a service/product into a platform.

Customers: Appstores allow the customer the opportunity to avail Long Tail services

Developers: Appstores allow the developer the opportunity to market their service at a relatively low cost to a niche audience. In other words, appstores match niche audiences to niche services.

Two other perspectives also come into play:

a) The commonly asked question is: Customers have access to more than one appstores. Which appstore will customers use? Typically, only providers ask this question. It is the wrong question since the customer does not care for appstores and nor do they ask this question, but rather she is concerned about specific apps. Appstores are an abstraction which suit the provider but are merely an avenue for the customer to access apps

b) Secondly, some of the appstores today are recreations of older services like ODPs (on device portals) which never managed to gain much traction. To be truly different, they need to overcome the limitations of the old ODP platforms

With that background, the HipLogic – Carphone warehouse announcement says that:

HipLogic Partners with The Carphone Warehouse on Distribution of Connected Interface for Real-Time Content

To break it down into it’s components:

• HipLogic Live is a free application that connects people to social networking sites such as Facebook and Twitter, media content from providers such as Sky News and Sports, and also offers an App store with access to thousands of game titles and additional real-time content.

• Carphone Warehouse (CPW)will now offer HipLogic Live on many of the most popular mobile phones sold via retail stores and online via www.carphonewarehouse.com

• HipLogic Live has other features such as real-time home screen notifications.

• Mark Anderson, CEO of HipLogic. “HipLogic is like getting an extreme makeover for their phone interface.”

• HipLogic is pre-installed on popular handsets to help mobile users discover better media and social networking content that is streamed directly to a real-time phonetop.

• The application also serves as an affinity tool to better manage and build customer relationships for The Carphone Warehouse, a key turning point for the retailer to keep in touch and maintain brand connection with its customers.

Discussion

• The core HipLogic application is a classic ‘phone top’ + content + appstore – which brings the look and feel of an iPhone interface to smart phones. It can be pre-loaded or downloaded and comes with a collection of apps , an “iphone” style app grid plus a phone top that streams news stories and social feeds.

• The HipLogic application platform is a lightweight virtual machine connected to the cloud which enables on the fly updating. Others like Borqs(from China) are also in this space.

• Hiplogic supports mainly Nokia and Windows Mobile devices for instance Nokia 5530, E71, E72, 5800 , Sony Ericsson, Satio etc

• The application can be pre installed before the device comes to the store

• CPW appears to be promoting it in store(see visual)

• The HipLogic application is carrier agnostic i.e. all carries can deploy it

• ODPs have trodden this path before with limited success but Hiplogic claims that it is more efficient since it is not based on Java. Their solution is built on a new multi-tasking platform that starts at phone start and is “always-on” eliminating the discovery problems of former ODP’s. They also produce phonetop widgets that are content rich, like football scoreboards in addition to the full rich apps. They use a Javascript/Ajax engine because they believe that these technologies are built for the web and allow us to efficiently manage multiple content feeds and display them as mash-ups on the phone. Also, HipLogic believe that developers can build apps much quicker in Javascript than harder coding languages like “C”.

• The content is acquired from partners are Sky News/Sports, Astrology.com, The Times and MTV UK etc. The App Store that has free and paid content available from a catalog of 18K titles

• HipLogic gets revenue share for paid apps purchased via the app store and also a share of the advertising for the small banners in the media apps.

• EA Games are the top premium apps and Twitter, Facebook and Sky are most used.

Analysis

• The application is accessed from the home screen. The Home Screen lights up at phone start and you can toggle back and forth between it and the native home screen by pressing the Red or End Call Key on the phone. This is interesting. I wonder how the Operator and the handset vendor view this i.e. the ‘native’ home screen was probably influenced by either the Operator or the handset vendor

• I asked where do the 18K titles come from? These are mostly from getjar and other similar providers. In my view, that does not help with differentiation since the same (getjar/handmark etc) apps are on other platforms. Also, the most downloaded applications can be obtained independently(for example Facebook app can be downloaded from facebook itself)

• Today, the hottest platform is Android and as techcrunch reports,

HipLogic Brings Customizable Real-time Interface To Android but the Android UI interface market but the Android marketplace has its own unique elements. For starters, Google risks OEM wrath with unified Android UI plan. Then there are different players like Samsung(BaDa), HTC(HTC sense) and motorola(motoblur) who are already in this space

Conclusions

1) In my view, appstores do not provide differentiation in themselves and hence the hiplogic strategy of appstore + apps + social networks + CRM may have some merit but with some caveats

2) I am unclear if any HipLogic applications be removed – ex I don’t want the astrology app, can it be removed?

3) I am unclear how other providers see this(ex Operators and handset vendors)

4) I know that appstores are a sexy topic now but I believe that it is much better to position such services like CRM/ affinity tool in addition to the appstore itself and finally,

5) Finally, In my view, HipLogic needs to move faster since this space is getting more competitive as I have indicated before especially on the Android market

Comments welcome