In case you haven’t heard the iPhone application development industry is in full bloom. Apple’s WWDC keynote address had a major focus on the iPhone and plugged several application development companies as part of it. Although the Apple notebook prices were cut up to $700 and a new updated Operating System, “Snow Leopard” is coming out in September (only costing $29 for the upgrade) the iPhone stole the show and its not just Blackberry that’s getting annoyed at all of this attention, digital agencies are also feeling the strain.

The application gold rush... is it over?

I recently read an article written by Mark Walsh, a Mobile Intellegencer for MediaPost Publications. The article claimed that iPhone application development was becoming over-saturated with more applications being submitted to the App-Store than sales of iPhones and although it had some great information, I must say that I feel it was tainted due to sheer frustration.

I wanted to comment on the site and let them know my opinion however they wanted me to sign up first. Nah… not going to do that… and so that is why I have written this post.

Patrick Moorhead, director of emerging media at Razorfish was faintly quoted in this post as being, “deluged with clients in the last year who previously may have had little or no interest in mobile marketing but suddenly need to have their own branded iPhone app“.

Mark Walsh then continues to say, “Moorhead’s skepticism stems mainly from two factors: the small iPhone user base relative to the overall mobile phone population and the ever rising number of apps in the App Store. By investing in an app, marketers are trying to reach an audience of iPhone owners that makes up less than 5% of the roughly 300 million total U.S. mobile users.”

The iTouch, The Poor Man’s iPhone… kinda

Wow I thought, thats quite the revelation. But wait a minute something is wrong here.

1. You are not just marketing to consumers with iPhone’s, these applications also run on iTouch’s.
2. Now Apple released information at the WWDC that all iPhone users and iTouch users total up to 40 million. Now thats just over 13% of the 300 million total U.S. mobile users.
3. You must recognize that when dealing with these statistics you cannot ignore iTouch users,. iPhone users make up only 37.5% of that 40,000,000 – the iTouch user representing 62.5%
4. Now do you honestly want to target ALL cell phone users? If so you would be crazy, wasting a lot of your budget! A LOT! Why not target those who make up 65% of all mobile web usage?
5. The future of the iPhone looks very bright. When the contract for the iPhone’s service provider comes to be renewed next year, I am sure that Apple will be looking to expand its… Verizon’s. It only makes sense to capture more market share. Also with the new iPhone OS 3.0 features AT&T customers can know that although they are paying a hefty fee every month for their iPhone, AT&T’s service will not allow you to take full advantage of the great features the iPhone 3Gs has. However I am sure Verizon’s capabilities would be up to par for a potential iPhone contract and Apple would be crazy to say no, its all about the opportunity expand the market share.
6. Last of all, of course more iPhone apps are being submitted to the App-Store than sales of iPhones, more than one app is allowed on the iPhone/iTouch and customers are wanting new applications, hence greater downloads from the app store than music. Demand is high, users want to OPT IN for branded applications that are of GENUINE worth

65% of all mobile web usage is being generated by the iPhone (I’m not sure if they are including iTouch usage here also), which says a lot about the future of the iPhone.

Now I understand that marketers cannot rely upon iPhone applications alone, and the new found industry is becoming cluttered fast. But the app store is not a marketing tool, rather a transactional tool. Traditional and other non-traditional methods need to be put in place to promote your brand, even application. It very much depends upon the market demographics you have set your eyes on and what you define as success in your campaign.

What do you think? Please leave your comments below

About the Author:  Rob Johnson is a freelance web developer who has a passion for online marketing. He is an Addy Award winner and currently teaches a New Media Strategies class at BYU-Idaho.