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Can Nokia's Ovi App Store Compete with Apple's?

Nokia's just pulled the wrappers off of its Ovi application store at Mobile World Congress—can it really compete against the might of Apple's App Store and the iTunes eco-system?

Ovi is basically following on the coattails of Apple's iTunes store, being Nokia's own online portal to apps and media. It'll offer a 70% revenue share to developers, which is also matching what Apple delivers, and it will serve applications aimed at business as well as gaming, music and video. The N97 will be the first phone integrated into the service, with the remaining phones following when the system goes live in May.

That's all very interesting—but will Ovi be as much of a runaway success as Apple's iTunes App Store?

First, consider why Nokia is opening an application store: it's a way to stream revenue into the company with a share of app sale prices, and to potentially push the sales of cellphones and smartphones. In contrast, Apple's app store—if you believe the spin—evolved as a request from the public and developers to be allowed to develop products for the iPhone. Steve Jobs' iPhone launch presentation suggested it would be a closed platform, and then the it opened up when a halfway-house web solution didn't allow enough access to the phone for successful app development. It was an organic process, and it's resulted in a thriving development atmosphere.

Then there's Nokia's "comes with music" service, which seems to have stirred up a degree of excitement. It's simply a music-delivery system for Nokia phones. Apple's service is for a single smartphone, whilst Nokia's is for dozens of different handsets with two different Symbian OS's aboard. Compared to that, Ovi needs to be tightly managed and closely integrated with a service like "comes with music" otherwise it's a clunky way of getting apps and media onto Nokia phones.

Whether Nokia's app store can compete with Apple's is very much is akin to comparing the physical retail stores Apple has and Microsoft is going to have. Just like Apple and Microsoft Stores, Ovi and iTunes services are aiming at different markets: Apple to its smaller but brand-loyal hoard of smartphone users, and Nokia at countless millions of its own smartphone and dumb-handset users. Success depends on how you define it. If Nokia can manage micropayments properly (as seamlessly as Apple does in iTunes, for example) and create an easy to use app/media ecosystem, then the sheer numbers of Nokia users will result in the sale of a decent number of apps.

Transforming Nokia's image into something as "cool" as the iPhone, and tempting people to buy its products on the basis of the applications you can install, is a different matter.