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Apple's Growing Content and Application Economy.

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Disclosure: I have no financial interest in Apple, its products or its services.

For technology journalists and analysts, the past few weeks have been busy with extensive coverage of the Apple iPad. Just over a week ago, the first reviews of the device hit the web. Today, over 300,000 people have the device, with even more people expected to purchase one with the release of the 3G model.

Apple is a company that has tightly controlled its ecosystem -- hardware and software. While building that ecosystem, Apple has also created a significant content and application economy. Today, the iTunes Store is one of the largest content portals in the world. Less than 2 months ago, Apple announced that it had sold more than 10 billion songs, making it one of the largest music retailers in the world.

According to Apple:

The iTunes Store has a catalog of over 12 million songs, over 55,000 TV episodes and over 8,500 movies including over 2,500 in stunning high definition video.

Unlike many other digital media initiatives, nearly all the content mentioned above is paid. With its market leader position in portable music, Apple has a significant potential of making the iTunes Store bigger than what it is today.

Similarly, Apple's mobile application model has been a huge success for the company. According to the company, over 100,000 applications have been downloaded more than 3 billion times in less than 18 months.

With the release of the iPad, that number could be much higher, opening up tremendous opportunities for those who choose to adapt.

While the mobile platform has been a huge success for Apple, there are still numerous concerns.

  • Anti-competitive (Google): A few months ago, Apple and Google were involved in a very public debate regarding the inclusion of Google Voice in the App Store. It got to a point where the FCC had to intervene and request answers from all parties involved.
  • Anti-competitive (Adobe): Apple and Adobe have not gotten along in the mobile space. Given that Flash is installed on nearly 98% of computers and that almost every web video company uses Flash to display video content, this is a significant issue for content creators. Re-converting thousands of videos for a platform that might succeed is a huge risk.
  • Features: Apple has been criticized for dumbing down most of their mobile devices. For example, one of the largest complaints of the iPad has been the lack of a camera.
  • Stability: Apple's application approval process is extremely inconsistent. For a company that focuses on stability of its platform, it seems strange when on occasion the company rejects well made applications and yet includes inferior apps.

Despite these drawbacks, Apple continues to grow very rapidly. And, while it will still continue to innovate and experiment in the hardware space, its content and application portals could become multi-billion dollar business units of their own.


Aanarav Sareen is a content creator and digital media consultant. He blogs at Digital Media Business and publishes the monthly Digital Media Newsletter.