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Entrepreneurs eye iPhone apps


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?


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