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Web 2.0: iPhone Steering Future Of Mobile Apps

The success of the iPhone and iTunes App Store has given some developers a great opportunity and put others behind a wall.

Amid the ongoing iPhone hype, not to mention the emergence of the Android platform and the forthcoming Palm Pre, it sounds like heresy to suggest that developing Web-based mobile apps is a better business decision than developing native apps for mobile devices like the iPhone.

But Jason Grigsby made that argument at the Web 2.0 Expo in a session Thursday and made it well.

Like many other developers following the release of Apple's iPhone SDK last year, Grigsby saw the success of the iPhone and the iTunes App Store and wondered whether his mobile development company, Cloudfour, should be restructured to focus on Cocoa, Apple's programming environment for Mac OS X and the iPhone.

The iPhone gold rush has lured many new developers with tales of instant riches, like that of iShoot creator Ethan Nicholas, who reportedly earned $600,000 in revenue in a single month.

Of course, such exceptional stories are exceptions. Less well known are tales like the fate of Newber, an unreleased iPhone application designed to provide Google Voice-like functionality by letting users redirect incoming calls to different phone numbers based on the user's location.

FreedomVOICE Systems, the company behind Newber, says it spent more than $500,000 developing its application and submitted it to Apple for approval on Oct. 2. One hundred eighty-two days later -- the company has a day counter on its Web site -- Apple still has not responded with a notice of acceptance or rejection.

Two weeks ago, company CEO Eric Thomas said in an open letter that his company was suspending work on Newber.

For Apple to "not reject us and not communicate with us ignores [its] social responsibility as a company," he wrote. "I don’t think it takes a genius to figure out that tar pitting us for six months by not talking to us at all will cause real harm. In our case if [Apple] had even flat out rejected us six months ago we would not only have had the opportunity to save 50-100K on trade shows and marketing that we had to commit to but we could also have changed course and released on the BlackBerry."

Problems of this sort, like massive successes, are rare. Grigsby said that 96% of iPhone apps get approved and only 4% run into problems.

Nevertheless, he and his company decided to focus on developing mobile Web applications, which work on any Web-capable phone, rather than on native iPhone applications.

It wasn't just a desire to avoid being dependent on Apple's approval process; it was also an accretion of evidence that iPhone apps face difficult business challenges.

Many of these are well known and much discussed among the iPhone developer community, such as the problem of "Ringtone Apps," as developer Craig Hockenberry described it in a blog post last December.

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