Monday, December 13, 2010

We Are All Salespeople Now

On December 9th, the website Patently Apple, which monitor's the computer maker's patent applications, came across a filing for an intriguing new application sharing feature.  In a nutshell, it would allow iPhone, iPad, iPod Touch, and Mac apps (coming in 2011) to be downloaded not only from Apple's proprietary servers, but also directly from devices belonging to one's peers.  Here's a graphic from Patently Apple outlining how the proposed feature would work:

The idea behind the peer-to-peer sharing function goes something like this.  Someone you know shows you an app.  You decide you like it, so you establish a wireless connection to your friend's device and presto! The app is yours, without ever having to log on to Apple.  At some point down the line, one or the other of the mobile devices would report the transaction back to Apple, which would in turn arrange for the appropriate billing.

It's difficult to draw meaningful comparisons between the analog and digital realms, but let me take a crack at it anyway.  Imagine for a moment that a friend of yours is reading a book.  You give it a quick inspection and determine that it looks interesting to you.  Instead of trudging to the library or bookstore, or ordering it online, your friend just happens to have another copy she'd be happy to sell to you directly.  And so on and so on, for every friend of hers who is also interested in the book.  (Somehow, the proceeds from each sale find their way back to the distributor.)

If Apple follows through on this patent application -- and there's no guaranteeing that it will -- then it could fundamentally alter how we understand and go about transacting for digital goods.  In addition to a fixed, centralized point of point-of-sale, there would now be millions of decentralized, mobile points-of-sale.  Buttressed by a sufficiently robust incentive system (say, a free 99¢ app after 10 paid shares, or something to that effect), you can only imagine how many apps would end up getting sold between friends.  We are all salespeople now.

In some ways, Apple's proposed peer-to-peer app selling system isn't anything new.  People have long discovered new products through interactions with friends, family, colleagues, and acquaintances.  It's not a coincidence that these types of communications are the basis upon which viral marketing is built.  What is different, however, is the way in which Apple could conceivably close the gap between word of mouth advertising and a completed, commercial transaction.  Ideally, the two moments would become virtually indistinguishable from one another.

The other odd bit here, which no one seems to be commenting on, is this: under the proposed system, people would be paying Apple hundreds, even thousands of dollars for its hardware, which would in turn allow them to buy into the company's mobile app sales force.  That's right -- you get to pay for the privilege of working for Apple Computer! This is assuming that the meager incentives you receive for selling are, on balance, incommensurate with the high cost of the hardware.  If it wasn't abundantly clear by now, Apple truly has a bullpen full of evil geniuses in its employ.

Get ready to go to work.