Amazon Web Services was a game-changer for application developers. Suddenly, budding entrepreneurs no longer had to install and maintain their own servers—they could just plug into the Amazon system. That lowered costs and barriers to entry for many companies, and it helped foster the current tech boom. Today, AT&T is releasing a set of tools for developers that will help push that boom further.
AT&T's new toolkit, going live in beta on Wednesday, includes an API platform and HTML5 software developer kit (SDK) for use by any and all developers. Gaining access to components within the AT&T network with this toolkit, developers can skip the pain and time it would take to build all those components themselves.
The move is a bold choice for AT&T. Traditionally, carriers have taken a closed stance when it comes to technology. Opening up to developers, however, is part of AT&T's new innovation strategy, profiled in the June issue of Fast Company.
Along with the release of its developer toolkit, AT&T is opening a new innovation hub in Palo Alto on Wednesday, called the Foundry. The carrier has already opened other Foundry innovation centers in Plano, Texas and Tel Aviv. In these hubs, AT&T helps developers create ambitious new apps by providing a range of services and support.
Like other carriers, AT&T has long worked with outside developers. However, it historically made developers go through a long and arduous vetting process in a careful effort to protect the AT&T brand. Only a small percent of mobile developers could make it through that process before. With its new tools, now AT&T is essentially opening the company's internal components, and lending its brand to anyone who wants to play.
This is the equivalent of a top restaurant like Chez Panisse deciding to allow chefs from any dining establishment in to use its world-class kitchen to prepare their own dishes. It’s obvious why other food service providers would want to use Chez Panisse’s kitchen: Why spend time (and money) designing your own kitchen, and assembling your own equipment when you can have access to the best almost instantly?
For application developers, AT&T's toolkits appeal in the same way. The company has spent 85 years building powerful internal tools to run its communication network, and now developers have access to many of them. They’ll specifically be able to use assets that allow applications to: send and receive SMS and MMS messages; access a device's location information; run payment and billing systems, or run advertising.
Developers will no longer have to spend time (and money) building components that can perform those functions. Instead, they can just snap the systems AT&T has already built into their own applications like a set of Lego pieces.
Sam Ramji, vice president of strategy at Apigee, says "[Now] the barrier to entry for being an entrepreneur drops enormously...You don’t need to go out and build a giant development team to build an app." Apigee is one of three partners that helped build the AT&T toolkit.
For AT&T, the appeal is more subtle, but equally profound. Carriers like AT&T (and Verizon, T-Mobile, Sprint, etc…) used to curate the developers they worked with, who then built applications that were pre-installed on carrier-approved phones. Before there was an iPhone app store, choosing which developers to work with was an important strategic choice, because consumers picked mobile carriers in part based on what apps would be available on their phones.
The iPhone store changed all that. Consumers no longer had to worry about what would be available on their phones. App stores, starting with Apple's initially, and moving to Google’s Android system more recently, gave users access to a world of applications they could select and install at will. What comes pre-installed on the phone is less important these days. What has become more important, however, is the range of applications available to use on any particular device.
App ecosystems, like those that have emerged around Twitter and Facebook, demonstrate the richness of features, applications, and even new ventures that are made possible when companies open up their internal tools and data to outsiders. They’ve also demonstrated how one company at the center of an ecosystem, like LinkedIn, becomes more valuable to consumers the more applications are built on top of it.
"The leaders of tomorrow are going to be the ones that nail the app and API trend," Ramji says. For carriers, developing an app ecosystem powered by third-party apps can help cement customer loyalty.
What those applications will look like is up to the imaginations of the developers who build them. Ramji provides a couple modest examples: By accessing device location information, a developer could create an app that showed you where all your friends were on a map, so you could easily reach out to those nearby if you want to grab a quick bite to eat, or get an impromptu Frisbee game together. Or, by accessing AT&T’s SMS infrastructure, a timesheet application could allow mobile workers to log in by text message when they arrive and leave a particular job site, helping streamline accounting processes for any company using that app.
AT&T is the first carrier to fully dive into this approach. The interim CEO of Sencha—a provider of open source web application frameworks to huge enterprises—Michael Mullany says, "They’re leading the charge to open up their API’s in a way you’d expect from a technology company, not just a carrier." Sencha helped AT&T build its toolkits. So did Amobee, a company that offers mobile advertising solutions.
According to AT&T CTO John Donovan, about five million independent developers build apps today, and about 50,000 of those currently have access to AT&T’s network assets. In 12 months, he says that the company hopes to see as many as 200,000 developers working in its new ecosystem. By comparison, just under one million developers participate in the Facebook ecosystem.
Another measure of the growth of the AT&T ecosystem will be the number of "calls" outside applications make to the AT&T API. Every time an application needs to use an AT&T asset, it has to make a "call" to the network. A year ago, applications were making 300,000 calls a month, Donovan says. Last month, they made 3.7 billion. Donovan says AT&T hopes to see at least 10 billion calls a month by September 2012.
It's not all charity on the carrier's part. The new strategy and openness will also produce new revenue streams. Some of the assets can be accessed by developers and their apps for free, but others have various business models associated with them, like a per-call fee, or a revenue share for the use of certain advertising modules.
While AT&T is hoping developers build applications that will be particularly valuable to its customers, the fact is that developers will be able to build applications that can be used on devices supported by other carriers as well. So, AT&T is thinking even further. As applications move to a wide array of devices, including televisions and systems on board or built into cars, AT&T wants to be a core building block—much like Amazon Web Services—that developers automatically reach for when constructing their apps.
Apigee's Ramji says that when his company initially presented the idea for the API Platform to AT&T, they were envisioning a system that would let "someone build the next Twitter on top of AT&T’s platform services. What was missing was a way to be able to easily use AT&T’s services in ways the carrier had never imagined," Ramji says. The release of the new toolkits represents a big first step toward making that possible.
[Image: Flickr user Klearchos Kapoutsis]