There are apps and application market places on many different platforms. Not only smartphones can run apps, but they have also entered TVs, watches or even fridges. It is likely that there will also be apps for cars soon. Not only because it makes sense for the user to be able to access services such as Whatsapp or Spotify, but also because it makes sense for platform providers.
Marketplaces or platforms establish strong network effects that enable the platform provider to gain a share of the value created on the platform. Network effects are reasons why firms such as eBay, AirBnB, Skype, Apple and Google are so profitable. They only need to maintain the platform and value is created by other people. The more participants there are on the network, the higher the value of the network itself. This can both held true for users (one-side of the network) and producers (the other side of the network). There can be network effects on the same-side and across sides.
Still network effects might also be negative. This shows for example in privacy concerns. Many young users of Facebook are using the network less, as their parents and grandparents join. Now they need to pay more attention to what content they like or which pictures they share. Parents might not appreciate to see drunk pictures from the party last night.
The question is whether the app marketplaces for cars will be run by car manufacturers or rather traditional electronic companies such as Apple and Google. They can make use of their existing network of developers and users who are already participating in their platform. Much as in the phone market (except for Apple) it could be the case that car manufacturers continue specialising in the car (such as Samsung or HTC for phones) while a tech company provides the OS and app marketplace.
We could however also see tech companies make use of the so-called ‘enveloping’. Instead of providing only an app platform for a car, they might produce the whole car by themselves and envelope the offerings of car manufacturers. One can see that this move is not that unlikely as Google has been testing cars for years.
Both apple and Google have software that is for incar use. Apple Carplay and Android Auto. What they basically do is provide a dumb screen that extends your phone. So instead of running software on your car you run it from your phone. The same is already happening with cars that have build in phone support, you link your phone to the car with Bluetooth and you can call/ pick up any call from the car interface, while you’re actually using your phone.
Dear Julius, interesting post about car apps. I agree that it is very likely that there will be apps for cars soon. Actually Apple has already made an integrated system working with some car manufacturers. This is called CarPlay, it is a smarter, safer way to use your iPhone in the car. CarPlay takes the things you want to do with your iPhone while driving and puts them right on your car’s built-in display. You can get directions, make calls, send and receive messages, and listen to music, all in a way that allows you to stay focused on the road. In my opinion, car manufacturers and tech companies like Google and Apple should work together to create a fully worthy car system.