I did a search for "AppStore", hoping to find Dan Farber's ZDNet post from a couple of days ago. Google asked if I meant "Apple Store". That's almost appropriate, considering Techcruch calls Salesforce.com's latest initiative an "iTunes-like store". As Salesforce CMO George Hu puts it, "instead of Mariah Carey, you may have Composition Management."
I'm glad I forgot to bookmark Dan's post, because the first ZDNet item from Google's search results was a Marc Benioff interview by Phil Wainewright back in February.
Phil: One thing that would certainly encourage developers to come onboard would be for AppExchange to have some kind of payment system...
Marc: We have a vision of something called the AppStore, where you can conduct that transaction with us. But I think it’s a little early for us to get into that world...
Anyway, based on Dan's description, AppStore's role will actually be more like record label + iTunes. Salesforce will charge 10% for an optional marketing program, which includes sponsored links on AppExchange searches and category listings. There's also a premium referral program, which costs 25%. AppStore itself costs 20% of amounts invoiced. That doesn't seem to leave much revenue for the rock stars, I mean application developers, at the end of the day.
eWeek found a customer who likes the idea, though. Vlad Voskresensky from Invisible CRM says AppStore essentially allows him to outsource sales/marketing/billing, so that he can focus on product development. On the down side, eWeek also points out that in order to take advantage of AppStore, developers must tie their boats to Salesforce's by using its Apex tools and development platform.
Back to the iTunes analogy... Forrester tells TheStreet.com that it doesn't look like iTune sales are taking off, but that's ok for Apple, which makes its money on iPods rather than digital music. Techdirt, too, says "the iTunes store isn't there to make money directly; it's a loss leader to help boost sales of the iPod. And for an added bonus (to Apple), the tracks' DRM locks users into iPods, since they can't easily transport songs to another device... As long as iTunes brings people to the iPod and keeps them there, it's doing its job. "
Will AppStore serve the same function for Salesforce? Is its main purpose to increase end user stickiness? Because if Salesforce really sees an opportunity in driving traffic to a wide range of third party products, maybe it shouldn't be comparing partner apps to Mariah Carey tracks?
PS - What an odd coincidence: Mark Cuban says Google could destroy iTunes, and HipMojo says Google could put Salesforce out of business. The two posts were posted within a minute of each other.
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