Verizon Developer Community (VDC) Conference

Verizon Wireless is Officially the First U.S. Carrier to Announce the Launch of an App Store

| Jul 28, 2009 | Wireless Services - U.S. | Show Update

| Analyst: Deepa Karthikeyan

Current Perspective: Slightly Positive
Vendor Importance: High
Market Impact: High

Event Summary

July 28, 2009 – Verizon Wireless announced that it will launch its VCAST Apps store before the end of 2009, making it available on all smartphones initially and to other devices soon after. The company enunciated upon the streamlined and transparent policies for developers, which include a straightforward testing and certification process, the promise to launch applications within 14 days of submission, offering developers the freedom to set their own prices and continued support for BREW applications. Most importantly, developers need not pay hefty fees to be eligible to submit applications and will receive the industry standard share of 70% of revenues accrued from applications sold in the store. The company is also encouraging developers via a contest - Apply Your Ideas, where apps submitted under select categories will be eligible to be featured in VCAST Apps store as well as retain 100% revenues from their sales if chosen as the winner.

Analytical Summary

• Current Perspective: Slightly positive on Verizon Wireless’ upcoming VCAST Apps Store as it allows the carrier to enter the highly competitive apps marketplace with a fairly strong offering. Verizon Wireless has gone all out to woo the developer community by offering them attractive perks like no registration and testing fees, the industry standard revenue sharing agreement of 70:30 (developers get to keep 70% of revenues accrued from the app sales) and the ability to set their own price. Direct carrier billing and access to subscriber demographics are also perks that are not available to developers via handset-based application stores. These initiatives, in conjunction with the Apply Your Ideas development contest, will help perk developer interest and help the carrier garner some momentum around its upcoming store.

• Vendor Importance: High to Verizon Wireless as it is the first carrier to officially announce the launch of its very own apps store, adding yet another layer to this highly competitive but fragmented marketplace. The announcement also marks its willingness to open up its network and sought alternate revenue sources while keeping up with industry trends.

• Market Impact: High on the U.S. wireless segment, because Verizon Wireless’ announcement signals the entry of a new vendor category to the apps market. Although its policies are not groundbreaking and are more or less in line with those of handset and independent app stores, it will up the ante of developers and other players mainly due to implied advantages such as access to subscriber information and APIs that are currently not available via other stores.

CLIENTS ONLY

Current Perspective

Competitive Positives and Concerns

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