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Let’s face it, apps are the new sexy.  They’re an easy path to success, right?

With companies like Instagram being purchased for $1 billion, everyone hopes their application is going to become the next big hit. But with the hundreds of thousands of apps on the market, only a few are going to be huge successes.

This is where platform choice becomes critical. Having reliable vendors, massive distribution channels, and the ability to rapidly bring products to market sounds like a gift from the startup gods. At the same time, relying too much on a single vendor, a single distribution channel or a single product can make it difficult to both scale and stay successful. The platform you choose may determine the fate of your business. Instead of relying upon OPP (other people’s platforms), why not build, control, and own your own?

Entrapment by the “Gang of Four”

In the book, The Age of the Platform: How Amazon, Apple, Facebook, and Google Have Redefined Business, author Phil Simon explains how the “Gang of Four” are leveraging their platforms to succeed, making thousands of other businesses and millions of consumers reliant on them in the process. Few talk about the Internet without talking about these platforms.

1. Amazon: Amazon’s platform powers some of the largest websites. When you hear of a problem with AWS (Amazon Web Services), you hear about major websites going down, from established giants like Netflix to growing startups like Quora. There are certainly advantages to allowing Amazon to do the heavy lifting for your business, but becoming too heavily invested in a single provider creates other issues, such as vulnerability to their terms, pricing, technological changes, and downtime. That’s why companies like Twitter and Zynga are increasing investment in their own data centers to support their mission-critical operations and limit exposure to OPP.
2. Apple: Many online businesses also use their vendor as their primary distribution channel, creating increased platform risk. If Apple decides to change its rules for apps, your business may suddenly be at risk if the company rejects your feature. Or, it may decide to incorporate your feature into its platform — suddenly, your business is obsolete.
3. Facebook: With Facebook updating its policies and updating its layout regularly, it’s becoming harder to adapt to the evolving platform changes. Again, Zynga is expanding outside Facebook to further reduce its reliance on OPP. Like Apple, Facebook takes a 70/30 split on sales through its platform, but 30 percent is significantly more than the 2-4 percent in processing fees you’d pay if selling through your own website.
4. Google: Everyone wants to be at the top of Google’s search results because it’s free advertising.  To a small business, that free advertising can be a significant driver of revenue. However, being too heavily reliant on Google can be devastating when it makes an algorithm change — just ask the small businesses who were affected by the recent Penguin algorithm update.

Why Digg failed

When I asked Phil Simon about Digg, he said, “I wouldn’t say that Digg failed ‘as a platform’ because I’m not entirely convinced that it ever was one. They made two fundamental mistakes: their improvements weren’t innovative enough, and companies like Twitter and Facebook more or less co-opted Digg. In 2004, the idea of doing one thing on one site made sense; but in the Age of the Platform, people no longer want to use single-purpose sites as much as all-encompassing platforms.”

Digg never became a critical tool in the arsenal of its customers in the same way the Gang of Four have. It wasn’t a platform customers relied upon for critical needs, and so its disappearance caused no pain to anyone but its VCs.

Why Instagram was different

While Instagram leveraged the Gang of Four, it became its own social platform in the process, with people relying on it to power their photo sharing experiences. Certainly Instagram’s growth wouldn’t have been as explosive if it wasn’t for OPP, but it still controlled its own destiny and caused a rushed acquisition to thwart the hugh threat to Facebook.

You don’t need to build a massive global platform to succeed, but you will need to do two things: limit your exposure to OPP, and become your own platform.

Your website, your platform

Unfortunately, small businesses still have the mentality that a website is just for marketing, when in fact, your website can become a vital tool in your arsenal and serve as the launching platform to scale your business while limiting exposure to OPP. But if your website is not a critical part of your operation, then it’s not a platform and can’t be sufficiently leveraged to scale your business — yet.

Regardless of how popular OPP become, your website can be the platform upon which you can control your own destiny. With the least exposure to external forces, ultimately, your website can be the foundation upon which you build all other services — including mobile applications. Plus, wouldn’t it be cool to have people build on top of your platform, and make it so they can’t survive without it?

Take the first step: define the critical operations of your business, then start planning a website platform around them.

Mark Cenicola is the President and CEO BannerView.com and the author of “The Banner Brand: Small Business Success Comes from a BannerBrand, Build it on a Budget.”

The Young Entrepreneur Council (YEC) is an invite-only nonprofit organization composed of the world’s most promising young entrepreneurs. The YEC recently published #FixYoungAmerica: How to Rebuild Our Economy and Put Young Americans Back to Work (for Good), a book of 30+ proven solutions to help end youth unemployment.

Image via kirainet/Flickr

Filed under: Entrepreneur

Until now, every Facebook mobile ad had to be triggered by you or a friend’s activity, but today Facebook begins testing a new non-social ad unit that lets developers buy mobile news feed ads that open Android and iOS App Store purchase pages when clicked. They’re designed to help developers grow their business. The ads are cost per click, not cost per install-based, however Facebook tells me it hopes to let devs measure installs driven by their app ads in the future, and is now taking developer signups for the currently small private beta.

By opening up the mobile news feed to traditional, non-social ads, Facebook will have to be very careful about how often these promotions appear to make sure they don’t drown out organic content and cause us to stick our phones right back in our pockets.

Facebook mobile app ads appear in a “Try These Games” panel in between traditional stories on the mobile news feed. The panel shows the name, thumbnail image, and number of friends playing (if any) of a few app (three in the example we’ve received). Organic and paid entries into the panel can appear side-by-side, with ads marked “sponsored”. Clicking through opens an app’s native iOS App Store application or Google Play application on your phone or tablet.

Facebook mobile ad reach, clicks, frequency, and spend can be tracked through a dashboard, and the ads can take advantage of all of Facebook’s biographical, interest, and device targeting options. This makes them much more flexible than Sponsored Stories, which advertisers could only target to friends of people who had already mentioned their brand or used their app. That means developers won’t need an existing user base to advertise their apps, and they can be employed to promote game launches — currently a huge source of developer ad spend on Facebook’s website.

For example, ads for an new iOS-only girl’s fashion game could be targeted to iOS device-carrying females 16 to 45 years old, living in Los Angeles to maximize the relevance.

Wall Street should be pleased to see Facebook getting more aggressive about mobile monetization. But the fact that these are just straight-up ads, not stories about friends that businesses pay to appear more frequently, brings Facebook into murky waters on mobile. It’s previously relied on the idea that its social ads are content to justify their injection into the news feed.

That’s why it’s a little frightening that Facebook told me, “It’s hard to say if there’s going to be a frequency limit” to how often mobile app ads appear. Though it did say determining if a limit is needed is part of what its watching for in the beta and that “we don’t want to show too much sponsored content because that would be the wrong experience for news feed.” Facebook will be testing and we’ll be watching to make sure users don’t rebel because it’s diluting a feed originally for friends’ photos and status updates with paid ads for random games.

There are now numerous crowdfunding platforms helping new and small businesses to find the capital they need, and we’ve seen hyper-local one-project-a-week efforts before in the shape of Lucky Ant. With a similar objective, Smallknot helps neighborhood enterprises to create their own funding projects, with reward packages for pledgers.

Taking its inspiration from the popular Kickstarter crowdfunding site, businesses can upload details about a project they are looking to undertake, as well as set the funding goal and time limit for backers to place a donation. Smallknot aims to help local businesses connect with fans and gain new custom by offering products or services in return for providing financial support. For example, a USD 25 investment in a local bar in Brooklyn currently rewards backers with USD 35 bar tab and a free bowl of pretzels as a thank you, while a USD 250 pledge gains donors a party for eight people. An extra incentive to get involved is provided through the fact that support translates into improvement in their neighborhood. Projects are funded providing they have reached their target by the end date of the campaign.

The site aims to be a nationwide service in the US but currently only features projects in New York and South Carolina. One to replicate in your part of the world?

Website: www.smallknot.com
Contact: www.smallknot.com/about/contact

Spotted by: Hemanth Chandrasekar

Matt Cutts explains that Google Webmaster Help has created 375 videos to answer questions users have asked and they have decided to do some more tutorial/informational videos. So, in this video Matt answers his own question “Is there a limit to how many 301 (Permanent) redirects I can do on a site?” in an effort [...]

The deal-a-day concept has proven successful for the worlds of nightlife and dating, so it was only a matter of time before we saw a combination of the two. Hailing from New York City, Coffee Meets Bagel offers users one potential match each day and, if they accept, a discount at a local date venue.

Users can begin by registering and uploading a profile with all of the usual information expected on a dating site. Coffee Meets Bagel then connects two users with similar tastes and gives them one day to choose to ‘like’ or ‘pass’. Once the time limit is up, another potential match is automatically delivered. If both users click ‘like’ within the 24 hour period, the site then also offers one of its deals of the day, which are designed to be used on the date. Deals include complimentary food or drink at a New York venue that the site has deemed a good date spot.

In a world of fleeting opportunities, Coffee Meets Bagel encourages residents of the Big Apple to grab them while they can. One to replicate in your part of the world?

Website: www.coffeemeetsbagel.com
Contact: support@coffeemeetsbagel.com

There’s a little-known stipulation in Amazon’s 3G browsing, available primarily on their e-ink devices. Ostensibly, downloading items over 3G is completely free but browsing the web using the device’s weird and slow experimental interface is capped at 50MB. Most users have never hit that cap and there haven’t been many reports of actual notifications.

That’s recently changed. One user of the Kindle Keyboard 3G noticed the message when he was browsing the web in Canada. He received a message that said he could only browse Amazon.com, Wikipedia, and the Kindle Store. Wi-Fi access was unaffected.

In the terms of use, Amazon notes:

This could be a reaction to folks tethering their Kindles, resulting in a tragedy of the commons effect where some users are using a piddling amount of data while others are blowing out Amazon’s allocations in a few hours.

via Digital Reader

Apple won a split-decision in a German court against Samsung’s Galaxy tablets. The Dusseldorf Higher Regional Court banned Samsung’s smaller Galaxy Tab 7.7 in all EU countries, but the iPad maker lost an appeal to block sales of the Korean company’s larger Galaxy Tab 10.1N. The ruling in favor of  Samsung confirmed “that the Galaxy 10.1N does not infringe” upon Apple patents, the rival firm announced.

In February, the same German court ruled that design changes made to the Galaxy 10.1N was enough to withdrawal the initial injunction won by Apple. Apple was unable to change the court’s thinking on appeal.

However, Apple was able to further limit sales of the smaller Galaxy 7.7 tablet from the original ban in Germany to now across all EU member states.

“We will continue to take all available measures, including legal action, to protect our intellectual property rights and defend against Apple’s claims to ensure our products remain available to consumers throughout the European Union,” Samsung said in a statement to the tech blog The Verge.

Besides all of this preliminary back-and-forth, the two companies are still scheduled to face off in a trial in German courts. The German court’s rulings on the two injunctive measures appear to throw new focus on Samsung’s comments Monday that Apple ‘prefers lawsuits over licensing.’

Additionally, the split decision in Germany is just the latest round in a long-running battle between Apple and Samsung as the two competitors vie to control the hottest mobile sectors: tablets and smartphones. As we showed yesterday, Apple has had more courtroom wins aimed at the U.S. market, while European courts have not been so overwhelmingly favorable to Apple’s arguments.

Filed under: mobile, VentureBeat

How much money is enough? We’re obsessed with this question, aren’t we? Research has found that there is a connection between wealth and happiness, but only up to a limit. The beneficial effects of wealth taper off almost entirely once a comfortable living standard is reached. More »

Earlier this week, Josh Constine wrote an epic piece on Facebook, Google and Apple’s impending messaging war. As Constine explains, we have most likely reached “peak SMS,” that is, text messaging is on the decline and another form of messaging will take its place.

But as the major empires wage total war for glorious messaging spoils, there are far smaller, distant tribes that will make their own windfall of riches from the battle. Man, I miss playing Age of Empires.

As these tech giants extend their reach even further, it is quite possible that users will seek to regain control over their information and embrace applications that quickly erase or encrypt their messages and pictures. Especially if the companies’ battle reduces their respect for users’ privacy—like Facebook’s aggressive email change last month.

The real gold mine for these impermanent apps is that they aren’t in the war. None of them can come close to these giants and none should try. But while the big three will likely engage in a winner take all battle, one or multiple apps can win side battles.

Take a look below at three popular iOS apps and the different ways they are filling the impermanent data space:

Wickr

Dear sources, Let’s Wickr on sensitive intel going forward. Please download: An App That Encrypts, Shreds, Hashes… nyti.ms/LCs08G

— Nicole Perlroth (@nicoleperlroth) June 29, 2012

An app that sends text, picture and video messages with military-grade encryption and allows users to set a time limit for when the message erases itself, Wickr is probably the most secure app out there.

“Email is for traceable and Wickr is for untraceable,” co-founder Nico Sell tells Venturebeat. “We have won the big fight once all online communications are untraceable by default.”

Burst

A mobile video and picture-sharing app designed for families, Burst recently raised $3.45 million in angel funds. The app lets users un-send pictures and videos at any time, revoking access to the recipient.

Snapchat

Snapchat, an app that allows users to send photos with a time limit (1-10 seconds) for the recipient to view the photo before it erases, announced in early June that users had sent over 110 million photos on the site.

“It seems odd that at the beginning of the Internet everyone decided everything should stick around forever,” Snapchat co-founder Evan Spiegel, my former classmate, tells me in May. “I think our application makes communication a lot more human and natural.”

Of course, it’s strange to think now: Why would I want to have text messages or pictures that erase themselves when my iPhone keeps all of my texts with my best friend, pictures from my cousin, and more? But think about if this was how other communication worked.

What if your cellphone recorded all of your phone calls? How would that change the way you use it?

Text messaging is inherently different from email and even online chats like gchat and Facebook chat. It makes sense to store emails and go back and look them up. But as people talk on the phone, and even in person, less, the importance of quick messaging has risen. Text messages are the closest thing to real-life conversations and, in many cases, it doesn’t make sense for them to be stored permanently.

Whether it’s Wickr, Burst, Snapchat or other companies, the spectrum of impermanent data apps will grow and become more competitive in the coming years. But there’s one giant uncertainty that I haven’t mentioned yet. Astute readers are probably wondering:

What happens if one of the giants integrates impermanent options into their messaging services?

Facebook messaging, Gchat or iMessage with an option for encryption, or an expiration date, or the ability to revoke access to pictures or messages. That would be a game changer for the battle between the big three and for the impermanent data app landscape.

(Age of Empires photo via Fickr/CLF)