Now That Flash Mobile is Dead, App Stores Could Be Next
Last week, Adobe announced that it’s no longer going to support Flash for mobile devices.
Which means if you own an iPhone or iPad – and you’ve been wondering if you’ll ever get to watch Flash videos on your device – you’re out of luck.
You see, Apple (Nasdaq: AAPL) has adamantly refused to allow Flash content to be viewed on its devices, citing reasons like increased battery drain and poor performance on mobile browsers.
So chances are you’ve run across several websites with missing videos or images while using an Apple mobile product.
But make no mistake – Apple’s stubbornness contributed to Flash mobile’s demise. The problem is, some have gone as far as saying that this development marks an epic victory for Apple.
But that’s not exactly the case. In fact, it could lead to a dip in Apple’s App Store revenue.
Here’s why…
Apple Can’t Take All the Credit
Apple may have had a hand in Adobe’s decision. But it’s certainly not the only factor at work.
Business Insider highlights three other reasons that Flash product manager, Mike Chambers, cites on his blog:
#1. The App Store Model: Many people are now using apps bought in application marketplaces, like Apple’s App Store or Google’s Android Market. Meaning games and other applications based on Flash aren’t as relevant.
#2. Fragmentation is on the Rise: I’ve discussed Google’s (Nasdaq: GOOG) fragmentation issue before. And since the Flash plug-in was available on Android devices, Adobe had to deal with this problem, as well, making sure the platform was tailored to meet the requirements of each version of the operating system. Not only that, but the company had to juggle different smartphone manufacturers and chip makers at the same time. Something Chambers says was “simply not scalable or sustainable.”
#3. HTML5 Lays Claim to Mobile: Another multimedia development platform, HTML5, has already established dominance in the mobile space. And yes, even Apple devices support it.
So while Apple had a hand in Flash mobile’s collapse, I wouldn’t call it an outright victory. Rather, it’s an inevitable result of multiple forces working against Adobe’s platform.
In fact, the end of Flash mobile could end up digging into Apple’s bottom line.
Trouble Brewing for the App Store
Back in July, I mentioned how HTML5’s momentum could eventually put a damper on Apple’s App Store revenue stream.
That’s because this platform allows developers to create fully functional applications that users can download to their mobile devices from the browser. Thus, bypassing Apple’s App Store – and the tech giant’s customary 30% cut – entirely.
More importantly, HTML5 apps can run on any device. So once developers create an application… that’s it. No more special formatting for different smartphones or operating systems.
Of course, as I said back then, “the popularity and simplicity of the App Store should allow Apple to maintain its gatekeeper status for a while… but not forever.”
But now that Flash mobile is out of the running, more developers than ever are going to be making the switch to the HTML5 platform. And Apple’s financial stronghold over the App Store might loosen sooner than expected.
Granted, since apps are only generating about 2% of Apple’s revenue this year, losing that market wouldn’t exactly be catastrophic. But at the same time, it’s a far cry from a victory.
Good investing,
Justin Fritz
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