Microsoft, Nokia Gun for Apple’s App Store

Microsoft and Nokia at 3GSM Mobile World Congress

Technology firms like Nokia and Microsoft are rushing to open their mobile software stores, hoping to follow the runaway success of Apple’s online App Store.

The focus of the mobile phone market has been shifting to software development since Google and Apple (NASDAQ: AAPL) entered the mobile market in the past two years. And for good reason: Research firm Strategy Analytics forecasts the value of the mobile content market — including downloadable games, ringtones, wallpapers, video, mobile TV, text alerts and mobile Web browsing — to grow 18 percent to $67 billion this year.

In response, Microsoft (NASDAQ: MSFT) is planning an “online bazaar” for applications running on its Windows Mobile operating system. At the Mobile World Congress trade show this week in Barcelona, the company unveiled Windows Marketplace for Mobile, a new store providing applications downloadable directly to users’ Windows Mobile devices.

Microsoft also showed off new smartphones from partners based on Windows Mobile 6.5, with a new user interface, and a data-syncing service called My Phone, that backs up text messages, photos, video, contacts and other phone information to the Web.

Nokia (NYSE: NOK) is also unveiling its download store this week, two industry sources told Reuters. Nokia promised in December to launch its own download store “soon,” as the Finnish firm merges its software download store with free media sharing site Mosh and widget service WidSets.

Blackberry maker Research in Motion (NASDAQ: RIMM) said last year it plans to launch its app store early this year.

Setting the page

Apple’s App Store has proved to be popular with iPhone users, and helped spawn an entire industry of entrepreneurs who design the programs which can then be downloaded by consumers.

The company said last month a total of 15,000 applications are available and downloads have hit 500 million in six months.

“After I started to use an iPhone, I realized I was downloading many more paid and free applications than before,” said Nexit Ventures partner Artturi Tarjanne. “It’s important for competitors to react quickly, but you have to realize that Apple has set the bar quite high. The response to this will undoubtedly take some time.”

CCS Insight analyst Ben Wood said: “The tremendous success of Apple’s App Store has underlined the importance of this distribution channel.”

U.S. software firm Amdocs (NYSE: DOX), software and services provider for telecom operators, said it would unveil its white-label application store offering — which enables the buyer to brand the store — to carriers in Barcelona next week.

“This year, app stores will be the main topic of the show,” Gil Rosen, a senior official at Amdocs, told Reuters.

Amdocs aims to attract a wide developer audience through access to a wide range of phone models. The firm says its access to service provider subscriber data will let programmers create more appealing software.

“The industry is like a big ship. It takes time to move it. Service providers are not the first movers, but when they move, the industry moves,” Rosen said.

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