AppCoins Protocol Gives OEMs a Cut in the App Economy
The number of smartphone users is forecasted to grow from 2.6 billion in 2017 to nearly 4 billion by 2020. With increasing smartphone penetration rates and 36% of the world’s population projected to use a smartphone by 2018, it makes mobile apps one of the most influential and powerful industries, mobilizing a number of players to participate in the ecosystem.
Android device manufacturers (OEMs) are one of the key players for bootstrapping the app economy by distributing innovating technology directly into the hands of users worldwide. One would think that most OEMs are getting a cut for being an influential distribution channel for software, including app stores. However, in most cases, they are not. In fact, most times it’s the opposite: OEMs actually have to pay expensive licenses to feature app stores, and don’t have a share of the revenue from the app stores business.
The Aptoide Android app store has been one of the pioneers in the app economy, and is mostly known for its disruptive model and multi-store platform, although one thing it stands out for is its business model towards OEMs and Partners. As part of Aptoide’s partner program, many of these OEMs have had the chance to reach over 200 million users worldwide, and share the content within Aptoide with their own local community.
Aptoide shares all of revenue generated in the app store with its OEM partners. Revenue streams from the store are advertising and IAP (in-app purchases) and they are split between parties.
Having been working with OEMs around the world for the last few years, it is clear how much they want to be part of the App economy — they are always looking for a larger and engaged user base, as well as for extra revenue streams. Aptoide has made it possible, either through a white label, SDK or API integrations solutions. Providing this flexibility to OEM partners is the reason that tier one Manufacturers (such as Xiaomi, Vivo, Oppo) choose Aptoide’s disruptive technology and services.
What if Aptoide decides to take it to another level, where blockchain technology would accelerate three critical flows that today are major blockers in the apps economy?
AppCoins is an open and distributed protocol for app stores based on the Ethereum blockchain and smart contracts. Aptoide is proposing an ICO (Initial Coin Offering) and blockchain technology to redesign app advertising, IAP and app approval flows through a circular model.
As a higher share of the advertising and IAP revenue is kept within the app ecosystem, more value is rooted back to the app economy.
Being an open protocol based on the blockchain, it also provides more trust to all parties involved. This allows for multiple app stores to implement and benefit from the open protocol and more stakeholders will contribute to its development and adoption.
This is breakthrough, and AppCoins is the first ICO serving 200 million users with the goal of creating a trustworthy economy without intermediaries. AppCoins will not leave OEMs out of the equation, as Aptoide never did.
Recognizing that OEMs play a fundamental part in this circular model, AppCoins ensures a 5% cut on all app economy transactions for all mobile device manufacturers. As this protocol is based on Ethereum, the different app stores (both Android & iOS) act as oracles of the smart contracts which are associated with each one of the platform’s core transactions (see AppCoins whitepaper for details).
This system creates a trust layer for the economy, rendering many middlemen obsolete and inviting OEM Partners to be part of the AppCoins universal language of the app economy.
To illustrate AppCoins’ added value to the app economy, we need to compare the new distribution of value with the existing one. In regards to mobile app advertising, the revenue share difference is very clear:
Regarding IAP, currently the value paid by the users when purchasing something within an app has the following distribution of shares:
With AppCoins, the shares are defined in public smart contracts, which brings transparency and trust to the economy.
In both cases, OEMs will have a share of 5% to foster the wide market adoption of AppCoins. By powering app stores with AppCoins by default on OEMs devices, these entities are seen as key drivers for AppCoins’ success.
There are a lot of OEMs with a good market share in the Android devices industry selling millions of devices to the world (ie: Oppo, Vivo, Xiaomi, Samsung). OEMs at times choose to have their own pre-installed Android app store. In theory, they could get a large number of apps given their reputation as an OEM. However, developers prefer to upload their content to the well-known stores. Their main issue is attracting new and updated content to make their app store useful to their user base.
In most cases OEMs are left out of the app monetization cake, but they are one of the main drivers of app economy growth. AppCoins allows the OEM to monetize their users through the 5% share included in the smart contracts. It also allows them to scale their content offer by partnering with app stores. They still keep their own proprietary app store and catalog while generating leads for existing app stores.
Accordingly, if there are predictions that by 2020 70% of the world population will have a mobile device, and only 5% of mobile users are making in-app purchases today, a more inclusive app economy is a huge untapped potential. AppCoins is the opportunity to be part of the change.
AppCoins pre-sale starts November 6th, so join our Pre-sale and whitelist now. OEMs have exclusive access to our pre-sale period with 30% discount on token price. Join us in the development of this revolutionary project.
Originally published at medium.com on November 2, 2017.