Anyone with a smartphone is familiar with the concept of an “app store” – an online marketplace where users can browse, purchase and install applications to their devices. It was Apple, which pioneered the concept, but was soon emulated by Google, Amazon and Microsoft. The latest to jump on the bandwagon is social networking giant Facebook, which has unveiled a new hub for consumers to find games and other apps on the social networking site.
Aiming to connect with its more than 900 million members on mobile gadgets, Facebook’s App Center will feature apps that work on Android and Apple’s iOS operating systems and the web. If a user finds an app compatible with their device they will be sent to download the app from the Apple App Store or Google Play. However, Facebook won’t make money from the sale of apps on other stores.
It is a strategic move from the world’s number one social networking site, which as of present has nearly 900 million active users. Through this hybrid marketplace: part store and part showcase, the company hopes to take monetary advantage of the app store model.
Growth for high-quality apps
You may wonder what sort of apps will Facebook promote through this store? The company has promised some serious quality apps. The App Center will prominently display well-designed apps that people enjoy and won’t list those apps which have received poor users rating or don’t meet the quality guidelines. Just like Apple’s App Store, each app will have a star rating, based on Facebook’s social graph. According to Facebook the idea is to solve the app discovery problem as in the App Center you will find only the most relevant and popular apps – the ones which are used by your friends. These apps will also surface in your newsfeeds and it is upto you to decide which one to pick and what to ignore.
Features paid apps
Besides offering one stop shop for your app needs, the App Center will also offer paid apps and games, a feature which was missing from Facebook so far. Making paid apps available through this platform would certainly offer a big business opportunity for both the developers and for Facebook. The payment feature will let users pay a flat fee to use an app on Facebook.com. And as standard, Facebook will take 30 per cent share of the profits. Through this model, the social networking site hopes to attract more users to its services and promote the use of the various Facebook APIs for integration into applications and spread the use of non-platform-specific apps, or HTML5 apps.
What’s in it for developers?
As we know that Facebook has clear advantage in terms of number of users, so for a developer, there are indeed a lot of opportunities. Developers will not only get more users (read traffic), they will also find Facebook paid apps and Facebook Credits as a good source for monetization. It will also give a big boost for social apps to get popular in the Facebook App Center as compared to other stores.
The new App Center, which the social networking site will launch in the coming weeks, comes at a time when the company is preparing an initial public offering that would value the company between $77 billion and $96 billion. Facebook, which makes a large chunk of its revenue from online ads, was facing slowing revenue growth given that a lot of people are now using smartphones to access its services, where Facebook provides limited ads. But with this new venture, the company will surely solve some of those concerns.