App Stores: Microsoft, Google Follow Apple

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Due to be launched later this year, the new storefront tracks users' recent searches and purchases and recommends additional software from its portfolio of some 200,000 applications. Handango CEO Bill Stone says the new stores will expand the larger market. "With the market growing so fast, there's plenty of room to operate," he says. Additional stores "can crack the code on awareness."

Still, aping the iTunes App Store won't be easy. "It's all Wild West days compared to the iTunes store," says Richard Doherty, director with consultancy Envisioneering Group. Each new market entrant faces its own, unique challenges in rolling out a store. And there's danger that some of the new stores won't live up to expectations. "There's almost as much downside to this if it's done poorly as an upside," Doherty says.

Google's Open-Door Policy

Take Microsoft, whose Windows Mobile software resides on millions of smartphones. Older Windows Mobile phones may not be upgradable to Windows Mobile 7 and may not be able to take advantage of the new Skymarket store. Other devices may not contain enough built-in memory for their users to download multiple applications.

Google's Android Marketplace faces a different set of challenges. Google will let developers post applications to the store in a matter of minutes, without going through an approval process. "A model like [Google's] really allows people to experiment," says Android developer Jeffrey Sharkey.

But that will make it hard to vet bad, glitchy, or inappropriate applications. To weed out bad apples, the Marketplace "features a feedback and rating system similar to YouTube," according to the official Android developer blog. But users could still unwittingly download software containing viruses or malicious code damaging a phone, or simply buggy applications. Apple takes weeks to vet applications posted to its store, and rejects many.

Programmers Hedging Their Bets

How soon the Android Marketplace will support paid applications is unclear as well. When the first Android phone come out this fall, "at a minimum you can expect support for free (unpaid) applications," according to the official blog. "Soon after launch an update will be provided that supports download of paid content and more features."

T-Mobile USA, owned by Deutsche Telekom (DT), appears to be feverishly revving up its own marketplaces, according to people close to T-Mobile. The carrier's new site for third-party developers states that "in the coming weeks, T-Mobile will be offering new ways to go to market." Unlike Apple, which sells applications for a single brand of handsets. T-Mobile faces the daunting task of offering applications that work with many different handsets, says Moe Tanabian, senior principal at IBB Consulting. T-Mobile declined to comment.

Unsure about how the stores will work, and which of these efforts take off and when, many programmers are hedging their bets, working on apps for a variety of operating systems. Microsoft's Professional Developers Conference, scheduled for October, has been the fastest-selling developer conference in history, according to Rockfeld. Interest in Android is surging. One blog for Android developers, AndroidGuys.com, has seen its traffic rise fivefold, to 10,000 visits a day, from June to August. "Proliferation of these stores can be a benefit for the developers," says Dan Gilmartin, vice-president of marketing at uLocate, which is working on applications for most of these efforts. "We are seeing growth in demand for applications across the board."

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Kharif is a senior writer for BusinessWeek.com in Portland, Ore.