Windows 8 Store: 8 Ways It Beats Apple

Microsoft lifts the curtain on its forthcoming Windows 8 Store in a bid to attract developers to create Metro apps.
Windows 8 Visual Tour: Microsoft's New Desktop
Windows 8 Visual Tour: Microsoft's New Desktop
(click image for larger view and for slideshow)
Microsoft on Tuesday said a public beta of Windows 8 will be released in February 2012 and provided details about its forthcoming Windows 8 Store, the mechanism within Windows 8 by which the company will sell and distribute Windows 8 Metro apps.

Windows 8 is the next version of Microsoft's operating system for personal computers, laptops, and tablets. It brings with it major changes, such as an integrated software store--similar in concept to Apple's Mac App Store--and support for ARM chips. Metro is the name of the new touch-centric user interface in Windows 8.

In Windows 8, Microsoft is following the trail blazed by Apple, a path that leads away from freedom and toward convenience and ostensible security. "We have seen the future of the PC and it looks a lot like a smartphone," said IDC program director of applications development software Al Hilwa in an e-mail.

Hilwa gives Microsoft credit for learning from the competition, notably in its revenue-sharing model and its consideration for enterprise features such as app sideloading and support for management tools. But he is less enthusiastic about the restrictions.

[ Is it too late for Microsoft to enter the tablet market? Read Windows 8 Tablets: Too Little, Too Late?. ]

"I lament that the world of the touch PC is a much more controlled walled garden, but the smartphone world has prepared us for it and there are certainly advantages in app discovery and deployment for consumers with an app store model," he said. "Whether the new model leads to more-secure or higher- quality apps is hard to call because we have seen poorly regulated app stores like Android's that have had some of the same quality and security issues of the existing PC model."

At the same time, he sees Microsoft having a lighter touch than Apple with regard to accepting apps in its store.

"In the app approval process, Microsoft is walking the fine line to provide more openness, speed, and predictability than Apple and more control and supervision than Google," he said. "It will remain to be seen if the execution lives up to this balanced promise, but the formula sounds right."

Indeed, Microsoft has made its forthcoming platform more appealing than the competition in several ways, at least on paper.

1. Royalties. Microsoft's revenue share percentage is 30%, as it is in the iTunes App Store, the Mac App Store, Amazon's App Store, and Google's Android Market. But once an app reaches $25,000 in revenue, Microsoft drops its revenue share to 20% for all subsequent proceeds.

This revenue scheme will help only the most successful Windows 8 app developers. However, the percentage of Windows 8 developers generating more than $25,000 from their apps--thanks to business customers willing to pay more for apps--presumably will be higher than it is for iOS developers. About 75% of iOS developers have earned less than $25,000 in lifetime revenue, according to one survey of game developers.

The best deal around for revenue sharing, however, remains the Chrome Web Store. Google charges developers only 5% for selling Web apps through its online store.

2. Fees. For those wishing to submit Metro apps, Microsoft is charging individuals $49 a year and companies $99 a year. This is better than the annual $99 Apple charges individuals or companies for membership in its iOS Developer Program and for membership in its Mac Developer program. For companies wishing to create proprietary, in-house iOS apps, Apple charges $299 a year.

Amazon's App Store developer fee also is $99 a year, same as Apple. Google's Android Market is the most affordable: It charges developers a one-time $25 fee. It should be noted, however, that Google doesn't provide much in the way of app screening.

3. Reach. Microsoft's reach advantage is theoretical at the moment. The company claims to have 1.25 billion Windows users globally, some portion of whom can be expected to upgrade to Windows 8, eventually.

If Windows has 92% of the desktop PC operating system market, then Apple, with about 6% global market share via Mac OS, has an installed base of 80 million Macs. As of the end of the third quarter, Google said that total Android activations had surpassed 190 million. The iOS installed base is estimated to be about 250 million by the end of 2011.

Certainly today, the iOS market is more attractive to a developer than the nonexistent Windows 8 app market. But it's worth thinking about tomorrow, particularly if the Windows 8 users turn out to be more inclined to pay for apps than, say, Android users.

4. Freedom. Apple, according to the Software Freedom Law Center, uses its control of iOS and Mac OS "to exclude competition, squelch criticism, and censor content." Microsoft might have done as much in the past, but its trailing position in both the tablet and smartphone markets has translated into an evident effort to have more permissive platform rules. Apple tells iOS developers explicitly, "If you want to criticize a religion, write a book," and that only "professional satirists and humorists" are exempt from its ban on apps that are "defamatory, offensive, mean-spirited, or likely to place the targeted individual or group in harms way."

Microsoft has a similar prohibition, against apps that are "defamatory, libelous or slanderous, or threatening," but the wording of what's disallowed suggests more tolerance for apps that push the content envelope. A mean-spirited app that's not defamatory would be allowed by Microsoft but not Apple, or so the written rules suggest.

But really, there's no way to tell: Microsoft could turn out to be just as cautious and restrictive as Apple. The wording of rules also isn't nearly as important as how each company implements its rules. We will have to wait for an app that Apple rejects and Microsoft accepts to really weigh the restrictiveness of the rules imposed on developers by the two companies.

If freedom really matters, Android is even less burdened by rules. Defame away.

5. Transactions. If Microsoft's content rules look only slightly more flexible than Apple's, the company's position on payment systems is significantly better. Apple requires iOS and Mac OS X apps that sell content within the app to use its In App Purchase API, for which Apple collects 30% of in-app revenue.

Microsoft will provide Windows 8 developers with an in-app purchase system, but will also allow them to use their own in-app payment system. "We don't mandate a specific transaction engine and developers can use their own," explained Ted Dworkin, Microsoft partner program manager for the Windows 8 Store, in a blog post.

Android's terms suggest developers can use any authorized payment processor. But Google doesn't provide a list of authorized payment processors and there's a reason why: "Currently, Google Wallet is the only authorized payment option for Android," a Google spokesperson said in an email.

Nevertheless, there are Android apps that use PayPal for in-app purchasing. Developers that do this are asking for trouble, but asking Google anything can take a while owing to the company's limited support options.

6. Trials. Apple doesn't presently support free app trials, a feature that's particularly useful for apps that cost more than a dollar or two. Microsoft will support free app trials, though developers will have to use its transaction system to implement in-app upgrades.

7. Enterprise. Faced with the explosive popularity of the iPhone and iPad, Apple only recently has decided to cater to enterprise customers. The slack, to date, has been taken up by companies such as Aperian, Good Technology, and MobileIron.

For Microsoft, the enterprise market is more familiar. The company's Metro app store should be business friendly out of the gate. Microsoft plans to offer companies three ways to manage Metro style line-of-business apps: Group Policy, App Locker, and sideloading. These three technologies will help IT departments deploy and manage Metro apps in ways that are similar to how Windows 7 applications are managed.

8. Marketing. Microsoft has reduced the friction of Metro app installation, making it as easy as installing a Web app from the Chrome Web Store. Through Internet Explorer 10, Windows 8 users will be able to view Windows 8 Store pages on the Web and install those apps with a single click. Apple customers don't quite have it as easy. iPad apps found on the Web using a Mac require the user to launch iTunes, due to the separation between Mac OS X and iOS.

It's too early to tell whether Microsoft's concessions to the developer community will make Windows more relevant in the tablet market. But Microsoft's opening gambit--more comfortable handcuffs--looks like a good move.

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