Is the end nigh for disks?

When Mac developer Fernando Valente emailed Apple boss Steve Jobs in April this year about the circulating rumour of a Mac App Store and future “walled garden” Mac OSX, he got a terse but clear response: “Nope”. Did Jobs mean there would be no Mac App Store or “no software without authorisation from Apple” as Valente put the question? 

In late June we reported on Microsoft’s leaked plans for Windows 8 which appeared in the form of confidential powerpoint slides leaked onto the Internet entitled “Windows 8 discussion”. The third slide entitled “Windows Store Scenario Overview” contained a bullet-pointed summary of what a Windows Store would do for consumers, developers, channel partners and for Windows itself.

Even if the leak is not genuine, though that seems unlikely, the description of the potential benefits of a “Windows Store” ring true and of course the success of the iPhone App Store and Android Marketplace are practical examples of which Microsoft will be keenly aware. As perhaps the greatest example of Microsoft dropping the ball, Microsoft had a lot of ground to make up considering the languishing state of the aging Windows Mobile platform.

As part of the “lick of paint” Windows Mobile 6.5 update, the company rushed Windows Marketplace for Mobile out on October of last year. So far the store has a little over 1,000 applications which is hardly likely to bother the iPhone’s 225,000 and Android’s 70,000 or indeed even the also-ran digital distribution platforms such as Nokia’s Ovi store with over 6,000, the Blackberry’s App World with nearly 7,500.

The problem for Microsoft is one of the crusty Windows Mobile platform itself which limits the appeal of the non-finger friendly operating system. It would be foolish to discount the company just yet, however, with the company’s major mobile reboot coming later this year in the form of Windows Phone 7 and the brand new Windows Phone Marketplace planned for the new system.

Windows Phone Marketplace looks set to benefit from the extensive experience the company has in mass market e-commerce. In case you’ve forgotten any of those, there’s two generations of Xbox including a substantial revamp of the latter Xbox 360 Live service, there’s also the PC-based Windows Live service which has been handling selling of game updates and customisations with an ever increasingly and impressive degree of integration into the wider realm of Microsoft services.

Microsoft is actually very good at the integrated digital distribution platform business. It’s certainly better at it than the chaotic digital jungle of the Android Marketplace. What’s been seen of Windows Phone Marketplace so far is pretty much a tick box demonstration of what it should be. 

One point that stands out is the tricky situation regarding trials. The iPhone App Store gives you nothing, once you buy and you find out the app is less than expected, too bad. At the other end of the scale is the Android Marketplace with the 24 hour unlimited refund policy which has ultimately translated to developer complaints of much less than expected revenue and high levels of refunds even for well-rated applications. 

The Windows Phone 7 Marketplace will have the most advanced features in this area by providing a set of underlying systems but ultimately putting the power in the hands of developers so they are able to decide how they’re going to offer trial usage. It will be possible to include time-limited trials as well as advertisement funded and premium features unlock approaches. 

Combined, if we considering the high quality and widely adopted development tools from Microsoft and pay-systems such as this and the ability to pay via various systems includes operator billing, mobile developers will very likely sit up and pay attention. There’s already never been anything quite so diverse and fast moving as the digital distribution platforms on smartphone but the real question is whether the approach will spill over to desktop computing.

Microsoft’s leaked discussion appears to suggest that the company is not going to be caught with its pants down this time and has put the Windows Store front and centre in discussing the feature set of the new desktop OS. There’s interesting signs that the company has picked up on some of the other benefits of digital distribution and cloud computing such as we’ve seen in Android already. The documents suggest a reset function where Windows 8 is able to reinstall itself and then copy back all of the settings and installed applications from the cloud.

Even beyond the main commercial operating systems of Windows and Mac OS X, Linux has shown a shift towards a central software repository approach as seen in the Ubuntu Software. Most of the popular software available under Linux can be one-click installed through this interface and alleviating infamously complex install processes in such a way has been seen as the leading factor in the rise in popularity of the Linux desktop beyond the hard core geek community. 

Google is taking a slightly different tack by trying to make installed software obsolete when it launches the Google Chrome operating system later this year. The argument the company makes is that for lightweight systems such as netbooks the user is better off running web applications and the Linux-based Chrome is an attempt at providing an easy-to-use UI and platform for a web browser. 

Microsoft might not be beaten to the punch just yet but it must surely be eying with concern the trend of hardware manufacturers to announce upcoming tablets based on Android rather than Windows 7. If there’s a light at the end of the tunnel it is that by the time Windows 8 is ready to emerge, the present day advantage in using lightweight operating systems for mobile devices will very likely have evaporated in the relentless technological march to add more horsepower.

Even Intel has been hard at work porting Android to Intel CPUs so it can deliver beefier notebooks based on Intel Atom CPUs and the chip giant has also been spreading bets by being involved in the MeeGo operating system with Nokia. MeeGo is effectively an easy-to-use UI on top of Linux which appears to be the emerging theme in new operating systems. 

The important distinction for desktop is that vendors like Microsoft and Apple will be very keen not to alienate existing developers. That’s likely behind the Steve Jobs “nope” although the company would be foolish to ignore what everyone else is doing in the entire realm of computing and ignore the benefits of bringing the App Store to Mac platform. The App Store is presently the greatest asset the company has, if there’s a question at all it might be the commitment the company has to OS X and the Mac itself.

It seems likely that desktops will differ from their mobile counterparts by continuing to allow the user to install applications outside of the digital distribution platform. So in the short to medium term, at least, software on CD and DVD look set to remain in the shelves of retail but sooner or later the thorny issue is going to arise about where the user buys software such as Microsoft Office. 

Software vendors, first or third party, are going to find the convenience of digital distribution and the protection of integrated DRM systems and automated update systems extremely attractive. 

This is going to set the software publishing industry on a collision course with platform holders reminiscent of the conflict that exists today with PC gaming digital distribution such as Steam where artificially higher prices appear in the digital platform at the instruction of publishers while appeasing retail with cheaper pricing. 

That might work in the case of PC games but we’d question how well it will go over with the public when Microsoft offers Office 2013 on Windows Store for Windows 8 in 2012.