Do Mobile Apps Create Lock-in?

A core assumption that many have is that mobile apps create lock-in. I’m not sure.

The assumption is based on lessons from the platform battle in the PC market where the amount of software that someone had purchased was a barrier to switching platforms. TidBITs summarizes well how this idea applies to mobile, and the iPhone in particular:

Apple is applying lessons learned from the Macintosh world to the mobile phone industry, and using the App Store and its applications as a way of generating platform lock-in on top of AT&T’s contractual carrier lock-in.

Platform lock-in occurs when a customer becomes committed primarily to the phone’s software, as opposed to its carrier’s service. If you’ve bought $200 worth of applications for your smartphone, you’re much less likely to switch to a different model in the future. In short, high spending on smartphone apps ensures long-term platform loyalty.

This reasoning was absolutely true when it came to the PC market. If you had invested several hundred if not thousands of dollars into software like Photoshop and Office on one platform, you were unlikely to switch to another.

However, there are many ways the mobile market doesn’t resemble the PC market, and I believe this is one of them.

I recently asked the audience a Mobile Portland to raise their hands if they used more than one third-party application on their phone daily. Everyone raised their hand.

Then I gradually increased the number.

Two? Three? Five?

By the time I got to five, less than half the audience had their hands up. When I asked who used ten or more third party apps on a daily basis, only one person still had his hand up.

This was an audience of heavy mobile users and no one was using more than a handful of apps on a regular basis. My own list of apps I use daily looks like this:

You could reasonably argue that there are a couple of other apps that I use occasionally plus whatever my game du jour is (currently Angry Birds), but even after adding those in, the total cost of the apps I regularly use is no more than $30.

My suspicion is that many people are in the same boat. Because the price of apps are so low, the switching costs are also lower.

There are some specialized apps that could make switching costs higher. For example, a doctor who had paid $299 for the Lexi-COMPLETE medical reference is probably going to think twice before switching smartphone platforms.

This is one of the reasons why enterprise application development is so important to every platform and why Blackberry will be more difficult to unseat than people think. Specialized software is the one area where higher prices and the amount of installed software can create lock-in.