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Mobile application uptake-it isn't only about iPhones.  Sure Apple's App Store now offers over 65,000 applications, and users have downloaded more than 1.5 billion iPhone and iPod touch applications in the 1st year since launch.

But while getting a late start, other mobile application storefronts are trying to catch up.  In the 3 months since launch, RIM's BlackBerry App World has 2,000 applications ready for download. The Nokia Ovi Store is leveraging (and paying 70% revenue share to) the large Symbian developer community to create new applications for its user base. At the myTouch 3G launch, Google announced that there are more than 5,000 applications in the Android Marketplace. Recently joining the party is the LG Application Store, initially targeting markets in Asia. 

But if mobile application uptake continues to center on smartphone application stores, how will mobile operators gain revenue value from the applications and services they are transporting? In a previous blog, I discussed a few ways operators can more effectively monetize the rapidly growing mobile data usage driven by this plethora of applications.  One approach is to enable developers to leverage operator network "hooks" to save development costs, differentiate their applications, and give subscribers an enhanced user experience.  Allowing developers to seamlessly integrate to operator billing and payments systems across legacy, 3G, and 4G networks is one way to achieve this.

For two scenarios of how mobile application uptake shifts the value captured across the ecosystem, we can look at trends in emerging and developed markets.

As mobile operators and device vendors focus on emerging markets for key growth opportunities, the ability to deliver low-cost handsets no longer precludes delivering rich services. This had led handset vendors to target content-driven services to customers whose mobile phone is their first and primary internet experience and for which price points are very low. As low-cost handsets deliver rich internet services, emerging market networks will see increased demand for delivering video, location, and messaging capabilities.

In developed markets, many mobile operators view securing an iconographic device such as the iPhone or Blackberry Storm as a necessity to maintaining high-ARPU customers. But these devices, while driving loyalty and intensive data usage, are also an attempt by device vendors to own the billing relationship and value add of content and applications delivered on their platforms.

As ARPU remains flat or declines on data plans, operators need the ability to share in value capture of the services themselves in order to offset the cost of backhaul and core network upgrades-but will this happen?

Several of the announced application store vendors have yet to settle on long-term billing solutions which are as seamless to end customers as, for example, iTunes is to iPhone customers. Further complicating the picture for the end user is that each major device vendor and mobile operating system player has its own app store and payments system.

One common theme we are likely to see in both developed and emerging markets is a desire from end customers to unify this fragmenting experience beginning with bill presentation and payment. Simply put, most customers prefer to have content and application purchase and usage fees show up on the same bill as their voice and data services.

Ultimately this means integrating app stores to operator BSS/OSS systems and doing so without impeding order flow to keep the transaction experience clean. Today's off-portal content solutions have drastically lower success rates than on-device application stores in successfully billing and settling content charges. This situation will only get more complex as operators migrate current BSS/OSS systems to dynamic policy and online charging architectures.

Accessing an application server for content or gaming may have different characteristics depending on whether a 3G or 4G network is being used. The opportunity to standardize charging policies and procedures across technologies will likely fall to mobile operators. Vodafone and Verizon, for example, have announced they will provide application programming interfaces (APIs) that will enable developers to collect micro-payments for applications through the use of these operators' existing billing systems.  Operators' success in doing so will be critical to capturing value from rapid uptake of app stores and content services delivered to both smartphones and low-cost handsets.

More Stories By Deborah Strickland

The articles presented here are blog posts from members of our Service Provider Mobility community. Deborah Strickland is a Web and Social Media Program Manager at Cisco. Follow us on Twitter @CiscoSPMobility.