The opportunities and challenges of alternative app stores

While Apple and Google may have been able to dominate the mobile market, change is afoot. With the advent of the EU’s Digital Markets Act, things are shaking up. We have already seen the big announcement that the Epic Game Store will be available on iOS and Android by the end of 2024 and it’s clear that soon more will be on the way.

But what potential do alternative app stores present to publishers and developers? And what do these changes mean for the mobile games industry? In this guest post, Product Madness director of growth marketing Piyush Mishra and Digital Turbine’s managing director, Shalom Michaeli, share their combined thoughts on what opportunities alternative app stores will present and what challenges must be overcome.

Alternative app stores are changing the shape of the mobile ecosystem – and this shift is picking up pace. With regulatory moves like the EU’s Digital Markets Act driving the need for alternative distribution channels, app developers and publishers are set to face the new reality that comes with alternative app stores.

There are ample opportunities with alternative distribution channels, from greater innovation and creativity to lower consumer costs. But, there are still some kinks to work out around prompting consumer adoption at scale.

The question is: How disruptive or lucrative will alternative app stores be for developers and publishers? Together, we represent the developer and publisher perspectives on the unique opportunities and challenges on the horizon.

Skyrocketing fees, innovation, and growing momentum

While app publishers and developers have some differing opinions on how to thrive in alternative app marketplaces, there is some clear common ground around commission rates, the opportunity for innovation, and the growing momentum in the space.

Both sides agree that the current 30% commission charged by major app stores is untenable for developers. This high fee forces developers to pass increased costs onto consumers. Epic Games CEO Tim Sweeney criticised the high commission rate as a “disingenuous compliance strategy” and vowed legal action. Sweeney accused Apple of imposing a new tax on web purchases, hindering price competition and developers’ ability to offer cheaper digital items. Maybe some legal pushback will make Apple change its ways.

As a recent survey shows, developers are hungry for a solution that fosters user growth. User growth is also the main factor in developers’ decision to invest in alternative solutions. Developers and publishers also agree that more options for app distribution can spur significant innovation – which can deliver on that growth. This contrasts with limited options – especially on iOS when you only have one choice for downloading apps. If you have several doors to go through, what can be done from a developer’s standpoint expands immensely. Alternative app stores can be the opportunity to democratise the market and enable new forms of experimentation and innovation.

With laws seeking to limit gatekeeper power and mandate sideloading, both sides agree that the conversation around alternative app stores is gaining momentum – and is here to stay and grow. Jointly, developers and publishers hope this will drive a future of increased choice and creativity within the app economy.

The battle with gaining consumer trust

On the other hand, publishers and developers have some reservations. While lower commissions and more options could be beneficial, some question whether consumer behaviour would genuinely change.

Given Android’s history of limited expansion for alternative stores globally, developers, in particular, feel there is room for caution here. Android has allowed sideloading for a while, yet alternative app stores have struggled to gain meaningful traction outside of specific markets like China and India. Developers caution that iOS users, particularly, have become accustomed to a single trusted brand – Apple. The need to build trust will be foundational to success, but developers stress that this will require a cautious approach with users.

However, publishers feel more optimistic about the consumer adoption of alternative app stores at scale. Partnerships between app stores and telecom companies can accelerate user acquisition by leveraging notification systems, devices, and other assets to attract consumers to these alternative platforms.

With telecoms actively interested in diversifying distribution channels, these partnerships can be used to offer users added value, incentives, or bonuses.This collaborative effort can foster growth and trust with alternative app stores, ensuring sustainable expansion and enhanced user experiences.

Overall, developers and publishers alike recognise there are challenges ahead in prompting consumer adoption.But, despite these reservations, both are optimistic. The benefits are worth the battle, and with strategic partnerships between stakeholders and a focus on building trust, alternative app stores can usher in a new era of innovation, lower commissions and costs to consumers, and a better overall user experience.

Ushering in a new mobile landscape

Alternative app stores are changing the game for mobile app publishers and developers, but they’re ready to face the new status quo – and the time is coming. With the Digital Markets Act now in motion, recent changes by Apple permitting third-party app stores on iOS devices for the first time are just the start.

Google and Apple’s long-time reign of control over 95% of the app store market share is ripe for major disruption now more than ever before. With the right strategies and precautions in place, app developers and publishers share excitement about the endless possibilities for new and innovative app experiences.