It’s probably fair to argue that the mobile app industry is more like a 19th-century gold rush than a sustainable market. App developers are setting up shop around the world to capitalise on the highly-profitable nature of hybrid monetisation apps, which typically involve in-app purchases and ads for free users.
While most mobile app designers are contributing positively to creating a great mobile marketplace, lax regulations and poor oversight by app marketplace owners have allowed a number of huckster-establishments to farm out poorly-made, dangerous or intrusive apps, frequently designed to exploit SEO algorithms. The Google Play Store, as a result of its lax vetting procedures, is filled to the brim with these apps. To an outside observer, it looks like the mobile app industry is going to lose user trust eventually due to market saturation and shoddy designers looking to make some quick money.
There are historical parallels to the current mobile app marketplace: the Great Video Game Crash of 1983. At the time, the nascent video game industry was rolling in 3.2 billion Dollars at its peak, and many American households owned an Atari 2600 console. The market was saturated with rival consoles, with Atari itself offering an alternative to the 2600, the ill-fated 5200, and an ocean of ‘Pong clones’ that offered a home experience of the arcade classic. Consumers were only willing to choose one of these, as video game consoles were still a novel idea and were expensive luxuries for many.
Alongside this, the 2600 had a rapidly-growing software library. Initially, Atari kept licensing rights to themselves, producing some of the system’s best known games with its in-house team. As many developers went uncredited, some Atari developers split off and formed Activision, one of the oldest ‘third-party’ developers in the video game industry and still around today. After failing to prevent Activision publishing their games in a court case, the precedent was set and the market was flooded by derivative, poorly programmed games, many of which were made solely as advertising ventures.
By the end of 1983, consumer confidence in the Atari 2600 and video games in general were completely eroded away. Atari famously had to bury hundreds of thousands of copies of an expensive video game adaptation of E.T. The Extra-Terrestrial after so many copies were returned or unsold, and the video game industry collapsed under its own weight soon after. In the end, the American console market had to be revived from the outside, as Japanese company Nintendo released their famous NES console and tightly controlled third-party publishing. The video game industry recovered, but it took 5 years for it to reach the heights it saw in 1983.
Just as Atari found themselves losing consumer trust by not regulating their software library, app developers and app marketplaces may find their customer base disillusioned with the app lifestyle that has taken hold in high-income societies. Whether that’ll happen is dependent on them learning from history.
Chetaru is an app design and development agency based in Darlington that is excited about building a better future with the latest technological and IT solutions available. Chetaru has the IT know-how that your firm needs to succeed and thrive, from beautiful responsive websites to economical SEO services and useful mobile app designs.