The mobile app boom forecast to hit $15 billion in sales this year is still largely a smartphone phenomenon that requires more expensive hardware and often pricier data plans. But we’re now seeing more examples of apps that avoid the need for data plans, bringing the love to a wider array of users, and more revenue to app makers.
Gemalto announced Facebook for SIM Monday, a Facebook application that works through a GSM SIM card to enable Facebook features without the need for a data connection. The application, which is embedded on the SIM, relies on SMS to pass messages, status updates, wall posts and friend requests back and forth. Gemalto said it will work on 100 percent of phones that use SIM cards. Basically this is Facebook connectivity delivered via texting plans.
Meanwhile, Scanbuy said Monday it’s enabling bar-code scanning for phones via multimedia messaging using its expanded Scan & Send technology. Users will be able to get information on scanned items by taking a picture of a barcode and sending it to Scanbuy via a short code. The Scan & Send system works with QR, Datamatrix, EZcode, and UPC codes and allows users to gain information on prices, reviews and coupons. Think of this app as Scanbuy via picture messaging or MMS.
We’ve talked a lot about the explosion of smartphones but while the price of devices is dropping, a key sticking point for many is the price of data plans, which often run around $30 a month. That limits the adoption of smartphones, and by extension, applications that rely on smartphones for distribution. By leveraging cheaper unlimited SMS and MMS plans, these latest applications are finding they can reach out to the still massive number of consumers who haven’t made the step up to smartphones and data plans. Brian Madoff, a research analyst with Deutsche Bank, said in a note recently that while smartphone adoption is picking up quickly, data plans are one of the biggest barrier for users. “Even if phones are as cheap as [$100] many consumers will still prefer to stick with voice-only phones so they can avoid having to purchase a data plan,” he wrote.
By avoiding data plans, app makers can make their apps available to the millions of users who remain on feature phones and voice-only plans. Scanbuy says it can now make its scanning technology available to 190 million U.S. camera phones. Gemalto said Facebook for SIM will expand the number of mobile users who use Facebook, which is about 200 million of Facebook’s more than 500 million users right now, and will be available for pre-paid customers as well as monthly post-paid subscribers. Gemalto, however, said it plans on charging an undisclosed subscription fee for the Facebook app after a limited free trial period.
Still, the opportunity is clear. Smartphones, while growing wildly, are still a distinct minority of all phones sold. IDC said phone makers shipped 1.39 billion phones last year, including 302.6 smartphones — about 22 percent of all phones. And in many emerging markets, 3G networks are still maturing. Facebook has also recognized the opportunity, recently releasing a version of its mobile app that works on feature phones from 14 operators around the world. Expect more application makers to follow suit. While smartphones are the big, sexy story going forward, the real storyline is the hunger for apps, which can be a lucrative business if extended to all mobile users, regardless of data plans.
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