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Entrepreneurs eye iPhone apps

Posted by: John Tozzi on July 15, 2008

The iPhone apps store opened last week, and Steve Wildstrom takes a look. As of Monday Apple said there were 800 programs available, about a quarter of them are free and most retail for under $10. Apple says the store got 10 million downloads in the first weekend. One analyst estimates the market for iPhone apps (which also run on the iPod touch) could be $1.2 billion in 2009.

I have no idea about that figure, but for software entrepreneurs, the iPhone apps store offers way to reach a highly desirable market: relatively wealthy early adopters, geeks whose approval can pave the way for a broader audience. Macworld reported that that Apple is sharing 70 percent of the revenue from apps with the developers. I don’t know how prices are set, but it seems like 30 percent is reasonable in exchange for a direct distribution channel into every iPhone owner’s pocket. (And, of course, having third-party apps increases the value of the iPhone, so it’s a smart move on Apple’s part.)

Some of the programs are from big companies (eBay, AIM). But it seems like the apps store is a level playing field for startups. One of the programs getting some play is Loopt, which uses the phone’s GPS to tell you when friends are nearby. (Loopt’s founders were among our Best Young Entrepreneurs of 2007.) There’s also Jott, a Seattle startup that transforms voice messages to text. And last month Arik Hessendahl ran down the iPhone debut of Qik, which lets users broadcast live video online while recording with their smartphones.

I’m iPhone-less (for now, ahem). But if you’re poking around the iPhone apps and see any promising offerings from startups, let us know. What company that we haven’t heard of will be a household name (or more important, profitable) next year on the strength of their iPhone app?

Reader Comments


July 16, 2008 05:28 PM

I've been using Limbo for a few days and I'm a big fan. It's kind of like Loopt as it lets you see what your friends are doing and where they are, except it lets you categorize the people you know into Faves, Friends and Contacts, and you can determine if these groups see you or don't. So, I usually turn my "contacts" off since that's where I put my business contacts.


July 17, 2008 09:59 AM

Don't user Loopt!!! This app raids your contact lists and spams them with sms - horrible!


July 17, 2008 01:06 PM


Just wanted to clarify, on behalf of Loopt, that we are correcting our invites process and should have a new invite version out by early next week. We apologize for any trouble we have caused. Please see our CEO's response here:

If you have any questions/comments, please don't hesitate to contact us at


JR Sower

July 18, 2008 05:59 PM

What a great opportunity for people to create apps and turn them into business venture. A whole ecosystem will be built around the iPhone, in terms of user-created apps. This reminds of when Facebook opened up their platform to 3rd party developers. Wow look at this information I found...

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What's it like to run your own company today? Entrepreneurs face multiple hurdles new and old, from raising capital and managing employees to keeping up with technology and competing in a global marketplace. In this blog, the Small Business channel's John Tozzi and Nick Leiber discuss the news, trends, and ideas that matter to small business owners. Follow them on Twitter @newentrepreneur.

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