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Just Having an iPhone App Isn't Enough

NEW YORK (AdAge.com) -- With nearly 48,000 iPhone applications in circulation, it's easy to forget how young the mobile "app economy" really is. The iTunes App Store has been around only 11 months; it registered its billionth download after nine months.

Once, just having a smartphone application was enough, but the era of novelty -- the blowing, shaking, one-trick-pony app -- is pretty much over. To rise above the clutter, an app has to be truly useful, whether it's created by a brand or by an entrepreneur.

Of course, it doesn't hurt to have an app very publicly used to illustrate a New Yorker cover. That's what happened for Steve Sprang, creator of the Brushes iPhone app, who has had 60,000 installs of his $3.99 app, 30% in the 10 days after the magazine cover hit the streets.

"There's a myth that there's easy money out there," he said as part of a panel of mobile experts at the CaT: Creativity and Technology conference in New York, hosted by Advertising Age and Creativity. "Most apps don't make any money, so it's really about publicity."

Increasingly, apps have to be supported by traditional marketing; otherwise they have little chance of making it to many iPhone screens. "The App Store is not a marketing vehicle; it is a distribution vehicle," said Raven Zachary, president of digital creative firm Small Society.

As dominant as Apple has been in the field of mobile applications and smartphones, the panel stressed it's still early. The gold rush may be over, but an era of truly useful apps that enable commerce and turn mobile phones into devices that control other devices is upon us.

"It's OK to come to market late, but you've got to do something different than the ones who came before you," Mr. Zachary said.

Don't rush it
It's also critical not to rush an app to market. Unlike a website, a buggy app can't easily be updated, and can sabotage users' experience. Mr. Zachary headed the 10-person team that developed the iPhone app for President Barack Obama's campaign for the White House. Development of that app took 22 days, but Mr. Zachary said most take much longer to get right. The backlog on Apple's review process for new apps stands at 12 to 14 days.

An iPhone app can cost $50,000 or more for an agency to develop. The market is still so new and experimental that marketers typically fund apps from their IT budgets, but Mr. Zachary expects that to shift to marketing in the next 18 months.

The app-development community is looking to the third revision of the iPhone operating system for new features, such as video capture and more memory and processing power, that will drive the next round of innovation.

"Apple continues to innovate; they are going to be a dominant force in the mobility space in the next decade," Mr. Zachary said.