"Seattle is the mobile Silicon Valley"

That quote jumped out at me in an announcement this week from Ireland-based NewBay that they've decided to set up their US headquarters here in Seattle. To be honest, I hadn't heard of NewBay before this news found its way into my feed reader, and I can't vouch for the quality of their "digital lifestyle solutions for operators". But I think they're dead-on about Seattle being a hub of mobile software innovation in the U.S.

I spent some time in the "old" (carrier-centric) mobile world in the early '90's working for McCaw Cellular (which ultimately became AT&T Wireless). I also consulted to bigco's on the role of mobile in their e-commerce strategies when I was at Sapient in the late '90's. But I pretty much gave up thinking about mobile as a vector for software innovation until 2007 when the iPhone blew up the old model and made it fun to be a mobile software entrepreneur again.

Seattle is a great place to be in this new software-centric mobile world because it's home to some of the biggest incumbents in both worlds. Both AT&T Wireless (McCaw) and the US arm of T-Mobile (Western Wireless / Voicestream) grew up here, and Seattle is also the US home of Israeli carrier services powerhouse Amdocs (which has Seattle startup Qpass at its core). Microsoft's strategically critical Windows Phone effort has drawn thousands of mobile developers and business folks to the area, and there are literally dozens of venture-backed mobile software startups in Seattle that were spun up in the old world and are now navigating their transition to the new. (Not to forget the hardware side, Taiwan-based HTC has been a quiet presence in Seattle for years but is muscling its way into the branded device business thanks to their growing family of Android-based handsets).

On the money front, local VC firm Ignition Partners was founded by wireless alumni from McCaw / AT&T and software veterans from Microsoft; and "stealth VC" Trilogy Partnership is a quiet force in the local mobile ecosystem, pooling the significant resources of a close-knit group of wireless industry veterans including Western Wireless founder John Stanton.

The "new world" of mobile software is dominated by Apple (Cupertino) and Google (Mountain View), but - despite an early and heroic attempt by Google to make mobile a carrier-independent experience - the old world still holds significant power and Seattle's hybrid culture of old mobile and new web makes it a great place to build relationships that straddle both worlds.

Just a few examples from the many old-to-new local efforts that I'm aware of:

• Swype - a fast text input method for modern touch-screen devices, now in wide deployment on Android handsets, was created by veterans from Tegic, the Seattle-based pioneers in predictive text entry.
• GroundTruth - a "big data" aggregation and analytics platform that's working to expose patterns in non-voice uses of wireless networks (e.g., social networking, e-commerce), founded by veterans from Qpass, Medio and Ontela
• Coming soon: Amazon's soon-to-be-released Android app store will add a new wrinkle to the local story, epitomizing the emerging blend of old (carrier-centric) and new (consumer- and web-centric) by leveraging the world's biggest online retail platform to sell smartphone apps.

We're very excited about the new world of mobile software at Founders Co-op and have several related bets in our current portfolio, including:

• Urban Airship - the leading publisher platform for mobile content delivery and in-app transactions for iPhone, Android and BlackBerry
• AppStoreHQ - a web-based consumer discovery platform for iPhone, iPad, Android and HTML5 applications, with a new personalized + social app discovery service for Android: appESP
• SPARQCode - A 2D barcode publishing and analytics platform that helps real-world retail, travel and print media brands add mobile experiences to their existing offerings

We're always on the lookout for new local companies that are taking advantage of the unique mix of mobile-related skills and experience here in Seattle. If you're building a "new mobile" company here that you think we should know about, please drop me a line.

How to solve the app discovery problem? Buy an installed base!

Monday this week I was on a panel at DiscoveryBeat 2010, a one-day show devoted to the topic of getting your smartphone app discovered. Speaker after speaker (myself included) delivered the same bad news: the eye of the app distribution needle is getting smaller every day and the deck is now stacked in favor of incumbent brands.

Much like the early days of the Facebook app ecosystem, the developers and publishers who succeeded in amassing millions of downloads - think Tapulous, Smule, Ngmoco, etc. - now control an asset that's arguably more valuable than their brand or software: a huge installed base that can be leveraged to drag new titles along.

Not coincidentally, several of these brands have recently been snapped up by larger media players who see the value in these incumbent mobile audiences. Disney has been one of the most active acquirers, picking up Tapulous for a rumored $40-$50 million, and Playdom (a leading Facebook gaming brand) for $760 million. Last week Japan's DeNA paid $400 million for Ngmoco, another leading iPhone game publisher.

The Android app ecosystem offered one of the few discovery bright spots at the show - the relative immaturity of Android as compared to iPhone, the weakness of Google's Android Market and resulting profusion of competing app store alternatives are creating points of leverage for savvy app publishers seeking to build the same powerful franchises that were created in the early days of the iPhone.

The best single example of this was app-maker Chillingo's decision to offer their popular Angry Birds game to Android users via a one-day free download exclusively with GetJar, a top feature-phone app distributor looking to make inroads with Android developers. The combined power of a popular game, a time-limited offer and free distribution brought GetJar to its knees - over 2MM copies were downloaded and Chillingo had to switch distribution to Android Market to meet the demand.

How was Chillingo rewarded for building the single-largest installed base on Android for an indie publisher? Today games giant Electronic arts snapped up Chillingo for $20MM in cash...


  Android apps at AppStoreHQ

DiscoveryBeat 2010: "App discovery is the key to customer satisfaction in the smartphone era. Discuss."

If you've been paying attention to the massive disruption underway in the mobile ecosystem (think iPhone, iPad, Android, app stores + platform wars) you've probably gotten the message that carriers aren't what moves the market any longer. Operating systems (iOS, Android, BlackBerry, WebOS, Windows Phone 7, etc) and the app ecosystems they support are where value is being created (and extracted) now - just look at Apple's share of mobile profits and you'll get the idea.

"It's the apps, Stupid"

The strategic battle for mobile OS dominance is fascinating to watch, but most consumers don't actually give a shit what OS their device runs. As I've argued before, the real magic in this new mobile marketplace is being made by app developers, and the OS + handset is just the stage on which the real battle for consumer attention and loyalty is being fought. Put simply, the OS that delivers the greatest value to the largest number of mobile app developers will be the one that wins.

It's in this context that the clever folks at VentureBeat have put together next week's app-focused show: DiscoveryBeat 2010. With 350,000+ apps now available across the top smartphone platforms, app discovery is emerging as the gating factor to mobile platform success. A broken app discovery experience has nasty ripple effects across the smartphone ecosystem:

When apps don't get found...

1. Consumers are disappointed - and blame the handset maker, carrier and OS vendor (more or less in that order) for the crummy experience
2. Mobile developers aren't rewarded for their hard work - eroding loyalty to their preferred OS and drawing them to competing offerings with bigger installed base and better app distribution

Android has the biggest problem

App discovery matters to everyone in the smartphone ecosystem - but it's a particularly acute problem in the Android community. So many powerful players - handset makers, carriers, digital content providers, etc. - have bet their future on Android that they can't afford to see it fail. But Google has failed to deliver the seamless, low-friction app discovery environment the ecosystem needs to compete.

These big Android players also still need to compete with and differentiate from each other - which is hard to do when they're all hawking the same basic (Android-powered) consumer experience. How can they differentiate? By trying to deliver better apps, in a more fluid and better-merchandised app discovery experience.

Who helps incumbents innovate? Entrepreneurs!

The bloody mess that is Android app discovery is a serious strategic issue for a long list of big companies: Verizon, Sprint, AT&T, T-Mobile, HTC, Motorola, Samsung, LG, Amazon, Best Buy, Yahoo!, AOL etc. This high-stakes, multi-party battle is an absolutely fantastic place for nimble software entrepreneurs to be messing around: lots of pain, high stakes, and hard technology problems are a startup CEO's dream. The smartest bigcos know they can't innovate and are always on the lookout for technology partners and/or acquisition candidates that can quickly add strategic capabilities they'd have a hard time creating internally.

DiscoveryBeat 2010 serves this opportunity up on a platter

If you haven't noticed, I'm super-hot about the app discovery opportunity, which is why I signed on as a DiscoveryBeat panelist ("App King-Makers") for the show next Monday. I know the problem well - Founders Co-op portfolio company AppStoreHQ is an acknowledged leader in the cross-platform app discovery space, and also operates iPhoneDevSDK, the largest independent community of smartphone developers on the web. 

If you're a participant in the new mobile ecosystem - whether an entrepreneur, a mobile developer, an OS owner, handset maker or mobile network operator - you'll be hard-pressed to find a more strategically relevant event on the calendar. Do yourself a favor and come to the show, and while you're there please track me down so we can talk about working together to crack the app discovery nut.

See you there!

I'll be at CTIA for the next two days - grab me if you want to chat

I'll be attending CTIA for the next few days - I'm on a panel Thursday afternoon and have a bunch of meetings lined up on behalf of Founders Co-op portfolio company AppStoreHQ - but I'd love to connect with anyone at the show who's interested in the Android platform, the mobile developer community and the app discovery problem (on Android in particular, but other leading platforms as well). If you know what I look like just grab me in the hall. If not, try one of the following methods:

Twitter: @crashdev
Google Voice: 206.801.1080
Email: chrisd AT appstorehq DOT com

Looking forward to catching up with old friends and making some new ones too...