Neil Mix

I’ve heard the iPhone described as a computer that just happens to be a phone, and this is true from a hardware/software perspective. But how about from a consumer’s perspective? While most developers undoubtedly see the iPhone’s computing capability, I’d wager that “mass market” consumers see the iPhone as an entertainment device that just happens to be a phone.

It’s a question with important repercussions. We’ll get to that in a bit.

First, consider the attributes of entertainment media and compare to computer applications:
Media: pleasure-based, ages quickly, must be relevant, low margin, large audience.
App: task-based, ages slowly, must be useful, high margin, small audience.

So when you write an “app” for the iPhone, are you developing software or producing media? It’s a strange crossover hybrid, because the most successful apps are…both, really. The iPhone makes media more useful. Or does it make productivity fun? The lines are blurred.

But when it comes to how apps are sold, the answer is pretty clear. Fire up iTunes and observe how apps are seamlessly placed along-side music, TV, and movies. Notice too that app prices have dropped to accommodate larger audiences. As every iPhone developer knows, getting on the top 20 list is the key to sales. But there’s a lot of churn in that top 20, few apps stay there for long. So top apps are very current — here today, gone tomorrow. And the audience is fickle, which means predicting (or causing) popularity is, well, awfully hard.

This can have a tremendous effect on product development. If you’re building something productive, usefulness is no longer enough to be successfull — it needs to be fun, too. And you have to think in terms of a recurring product line rather than a single flagship product, or you’re unlikely recover your development costs.

But even more important is Apple’s relationship with you as a developer, and what it means to be an entertainer. They are the distributor, and you are now the starving artist. Imagine a long line of performers on a blustery morning waiting to audition for a major Broadway production. Now put yourself in that line.

A few developers will hit big and eventually earn esteemed status with Apple. But most will simply live in the crowd, creating products for fun or dreaming of stumbling across the-next-big-thing.

Developers are not used to being treated as a commodity, and accepting this reality means swallowing a lot of pride. But that is the reality right now — iPhone developers are a commodity, and Apple has plenty of room to err before it loses significant dev capital.

Imagine you’re the developer of a complex application with many moving parts. It’s been released, and by all metrics it’s a homerun: customer satisfaction is through the roof, new customers are flocking to it in droves, and the product is efficient and scaling well.

But there’s a bug in the system. It’s breaking things, but in a very small way. It’s not effecting the business bottom-line at all (although it could in the future). It’s easy enough to fix in isolation, but you’re not sure how your fix will influence other dependent components. And if this bug begins effecting the business, you’ll have plenty of time to fix it before it registers a serious impact.

What do you do? Wait, of course. You wait until either the bug presents a risk, or until you devise a way to fix it that presents no risk. When things are going well — beyond all expectations — the last thing you want to do is introduce risk where it’s not needed. Just sit on it.

Ok, now imagine you’re an executive at a large public company with millions of customers and tens of thousands of business partners. You have a products for which customer satisfaction is through the roof, and new customers are buying it in droves. You are decimating the market. Profits are through the roof and shareholders couldn’t be happier.

But, some of your business partners are telling you that there’s a problem. This problem isn’t really effecting your business, and fixing it carries the risk of impacting other parts of the product and business in undesirable ways. And, despite the fact that your partners aren’t fully satisfied, they’re continuing to work with you and tons of new partners are scrambling to set up partnerships.

You see where I’m going with this, don’t you?

When I say “please stop whining about App Store review”, what I’m really trying to say is: focus your effort on something more productive. Apple hears you, they’re just not going to do anything about it. (Or at least not what you want them to do about it.)

The classic argument for loosening App Store review is that Apple is harming their product more than they’re helping. By hand-cuffing developers they’re preventing bug fixes from going live, they’re making developers unhappy, etc — you know the story. And then, the argument continues, that hurts developers and customers both indirectly and directly.

Here’s the problem: the numbers disagree. There is no metric or indicator I’ve seen that demonstrates that the App Store review process is hurting Apple in any way. So from a business perspective why should Apple make any dramatic changes to its review process? All that does is add risk they can’t quantify. There’s a risk they know about, and it’s not yet harming the business. They’d be crazy to act on that risk in the name of adding an unknown (and potentially much larger) risk.

So if you want Apple to change its ways, you can do the following: 1) demonstrate that there is actual risk to the business, or 2) suggest ways to fix the problems that don’t introduce risk.

Opening the iPhone for unrestricted access isn’t going to happen. Consider the history of the PC with spyware, viruses, and worms. Or consider phishing and lack of recourse on the web. Yes, Apple is the sole gatekeeper. In some cases, they’ve abused that power. In the vast majority of cases they’ve benefited customers, as demonstrated by the fact that the iPhone’s App Store isn’t a vast wasteland. They have zero incentive to open up.

To fix the App Store, you have to answer this question: how does one open access for legitimate, quality developers while keeping the scummy or incompetent developers at bay? There are answers, and I’d wager that Apple is already working hard on new and innovative solutions. But the house isn’t burning down, so there’s no rush those solutions to market. They may never arrive, depending on how things go.

So until the App Store is fixed, discontent developers are best-served doing something productive with their angry energy. Go develop apps for other platforms. Or write up enhancement requests with inventive solutions. While it may not seem like Apple listens, they do. The just don’t always respond.

Joe Hewitt garnered some remarkable press (for a developer) today by going on record saying he quit developing Facebook for iPhone because of Apple’s App Store review process. I am unimpressed. (With the article, that is — not with Joe and his paparazzi. Damn Joe, how’d you get TC in your pocket?) And I’m qualified to weigh in on this topic because…I wrote Pandora Radio for iPhone? Weak, but I’ll take the podium now, thank you very much.

Now, I understand that dealing with app review is a pain. No one likes it, it’s an imperfect process, it’s often arbitrary, blatant mistakes are made, etc etc. While some prognosticate a review-free ecosystem that is far superior to the status quo, let’s remember that such predictions are speculative, because no such mobile app ecosystem exists.

Read that last sentence again, because there’s a subtle trap in there. See it? Here’s a hint: name the platforms for which indy developers were writing apps prior to the App Store’s existence.

The moral of the story: the only reason indy developers are writing mobile apps today is because Apple let them when no one else would. So yeah, that review process is awful. But compared to the alternatives, the iPhone was unbridled freedom. Despite this, from day one we’ve heard endless harping about the evil review process and how bad it is for Apple and customers. Call it The Developer’s Thank You. And yet 100k apps later I’m still awaiting the flood of developers leaving the iPhone for greener pastures, and the flood of customers leaving the iPhone for other devices. Well, OK, there’s Joe Hewitt and Mike Arrington.

Apple is all about taste. The App Store is too. And there’s one thing I’ve learned from years of working for people with exceptional taste: to those without taste, tasteful decisions seem arbitrary and capricious. If you think the App Store would be better without a review process, ask yourself which criteria you’re judging. Can you honestly claim that the iPhone would be more tasteful if there was no review process?

Apple serves its customers, not its developers. And given Apple’s success with the iPhone product, it’s pretty hard to argue that they’ve been somehow missing the point. Quite the opposite. It’s always amusing to watch people question the sanity of product decisions for an insanely successful product. Are you crazy? This thing went off like a rocket ship! It’s hard for me to point to any iPhone product decision as an abject failure. It’s not about developer convenience. To misquote James Carville: it’s the product, stupid.

There may come a day when Apple’s review process causes it to lose customers. And if/when that day comes, I’m sure we’ll see Apple change its ways. Until then, can we give it a rest with the whole App-Store-review-process-sucks meme? The horse is dead. Hell, the whole farm is dead. Clearly, Apple and its detractors do not see eye-to-eye. The review process is a fact for now, there are alternative platforms for those who object, so let’s move along.

(p.s. Lest anyone take this post as criticism of Joe’s decision, it is not. To be clear, Joe was very respectful in his comments and he did what he needed to do: he voted with his feet. When I talk about “whining,” it’s not the Joe Hewitts of the world that I’m referring to.)

Apple says: we haven’t rejected it. AT&T says: we had no say in it. Google says: [redacted].

What? Are you kidding me? This, my friends, is what the old folks call smoke and mirrors. Google needs to speak up quickly and explain that redaction.

Here’s the problem: let’s say, hypothetically, that the FCC takes action based on these letters. We the public wouldn’t know all pertinent facts that resulted in such action. We would have no way to critique their judgement. But it’s our FCC. We own it, we have a right to know.

This whole thing stinks, badly. Big companies fighting big games over consumer territory. That’s bad enough, but now one of the parties would have the federal government as leverage in their favor. And they want to do it behind a veil of secrecy. Not good.

The FCC needs to stay away and let this sort itself out in the marketplace. And Google needs to speak up.

UPDATE: Google has since un-redacted the missing pages. Props to them for doing the right thing.

Go to download.com and look for software to buy for your computer. What’s the average price point? Probably around $30 to $50 for low-end software. Now go to the iPhone App Store — what’s the average price point there? Much lower, probably less than $10.

Why the difference?

The App Store demonstrates what happens when you simplify technology. Buying software for the desktop is a pain — you have to know which websites to visit, you have to know how to install the software, and you have to know what you’re getting into so you don’t end up with spyware. It’s not simple, it’s a huge time vacuum, and not many people do it.

For the iPhone, software is a consumer good. I mean consumers in the broadest sense — people who buy stuff from grocery stores, who shop at malls, who watch regular TV. You know, people who buy music on iTunes — those consumers.

How did Apple bridge the gap from power user to average consumer? Prominent access point, clean browsing, simplified and uniform installation, integrated billing, and quality control. And clean developer APIs that simplify development. The end-to-end cost of launching apps for iPhone is lower, so the price of apps is lower, and thus the risk of trying out new software is lower. The pool of software buyers expands, the pool of developers expands, and the ecosystem shifts. All this, and there’s not even a try-before-you-buy option.

It all seems obvious in retrospect. The question I ask now is: why doesn’t an “App Store” exist for desktop applications? Someone could make a killing.

Google has launched a social network platform to encompass all social network platforms. Besides the rather meta-meta nature of this play, it’s fascinating to watch the interplay between Google and Microsoft here:

Early October: Ballmer trashes social networks like Facebook as being “fadish”.

A few weeks later: Microsoft invests in Facebook for a ginormous valuation, beating out Google. This gives the appearance that Ballmer was trashing Facebook as a ploy — to lure Google into believing that Microsoft was only mildly interested in Facebook.

Now Google’s announcement. This raises several questions:

• Did Google lure Microsoft into over-bidding for Facebook? (The WSJ already published an article discussing the implications of the inflated valuation on stock options, i.e. Facebook’s diminished ability to use equity to lure top-notch talent.)
• Was Open Social a part of the discussions between Facebook and Google? Did Facebook relent for fear of becoming a share-cropper, i.e. an app on top of a platform, just like apps live on its platform? (Remember, whoever successfully creates the most meta platform wins.)
• And/or, was the loss of Facebook a huge blow to Google’s plans for Open Social?

Fascinating stuff. It does strike me that Google’s play seems incomplete without the big-gorilla Facebook. Does this now become The Law of Duality in action?

Neil’s law:

The size of the bubble is directly related to the number of experts claiming there is no bubble.

Now, I won’t say that we’re going through the exact same thing we did last time. It does appear a few lessons have been learned. But seriously, not every site that attracts a devoted following is going to be capable of generating huge returns using advertising revenues. So there’s going to be fallout. And when that happens, jobs will be lost. It’s a cycle; it’ll happen. It always does.

The amazing thing about market euphoria is the way it tricks people into thinking “This time it’s different! The rules have changed!” As if value can increase unimpeded forever.

That’s not to say we need to be all doom-and-gloom. It’s a fun ride — enjoy it! Just try not to lose your shirt over it. And if you do, enjoy it anyway! You only get a few such opportunities in a lifetime.

What do you do if you’re standing on losing ground in a debate? One option is to bait your opponent with a blatant lie. It’s a dirty trick, but it works, especially when the lie plays into preconceived notions of the listener. Your opponent must respond — silence implies truth. But to expose your lie changes the focus of the debate — is your allegation true, or is it not? Just how true is it? Listeners tend to believe there’s a grain of truth in most any point of view, and cling to falsehoods that justify their world view. Thus you gain ground in casting doubt on your opponent, even though the doubt is entirely baseless.

If you’re lucky, your opponent will be angered by the dirty trick, and argue back with fervor. This reinforces the listener’s (mistaken) notion that reality lies somewhere in the “middle ground.” If you succeed in evoking passionate anger, you’ve maneuvered into equal, polar opposition from your opponent. You’ve gained yet more ground.

What do you do if you’re standing on winning ground and your opponent sucker punches you with a blatant lie? I’m no expert in debate (clueless really), but I decided to do a little research: don’t get angry, don’t argue the veracity of the lie. Instead, re-cast the lie in a context such that the listeners’ thought patterns lead to its dismissal. Easier said than done! But it’s the only path that leads to decisive victory.

Why is this on my mind today? There may be a storm brewing in the web world. I see two opposing entities, and an uncertain future. A shot was fired (sucker punch), and the response was passionate. I can clearly see who’s in the right; those who haven’t been paying attention will not. And thus the passion of the response, while clearly warranted, only serves to establish a firm middle ground for those who don’t care to dig beneath the surface.

Don’t take the bait.

This year marks the 10-year anniversary of my first startup. My high school friend Dan convinced me to start a web-based shopping-cart service with him. My logic went something like this: “Ok, 4 out of 5 companies fail within their first year. But hey, I’m young and employable, what have I got to lose?”

We ran the company out of a spare office in a local ISP’s facility in downtown St. Paul. I worked consulting gigs to fund the business, Dan solicited consulting gigs for me and worked on selling the business. And in whatever spare time we could scrape up, we built the shopping cart.

We made mistakes. Lots of them. Technical mistakes, architectural mistakes, business mistakes, all kinds of mistakes. If I were to do it today, I would do lots differently.

In spite of that, a year later we were bought and relocated to San Francisco. Half a year after that our buyers were bought by Microsoft.

Had we run the business with the benefit of my hindsight and maturity, I suspect we would have failed. Perhaps within a year.

There are a few shared qualities I’d use to describe every successful bootstrapper I’ve met: resourceful, scrappy, never-say-die, and blissfully ignorant of the “correct” solution. Does it work? Ship it. Is it a hack? Ship it. Just do it. Make it work, just do it.

Those were fun days. I miss them. I don’t think I can ever fully return to that life, which is more good than it is bad. But it’s important to never lose touch with the bootstrapping temperament. It needs curbing, restraint. But not too much.