Editor’s note: More and more mobile app developers are deciding to make apps for Android, even though it still doesn’t have the same reach as the iPhone. In this guest post Kevin Nakao, the VP of Mobile for Whitepages, makes the argument for taking the Android plunge now (as he is preparing to with a new Whitepages Android app launching next week). Follow him on Twitter @knakao

Mobile games publisher Gameloft might have thrown in the towel on Android, but that is a mistake. I certainly understand why they gave up on Android. Since launching in February of this year, our own Whitepages Caller ID app has become a top ten grossing Android application, and yet we’ve seen less than $54,000 in revenue. While our iPhone app download counts are in the millions, our Android app downloads are a mere 17 percent of this volume.

Despite our meager return on investment this year, I believe that the real potential for Android app developers lies in the New Year. Here’s why:

End-To-End Goodness

In addition to being an open platform that facilitates device innovation, Android offers choice and progress when it comes to the marketplace where consumers discover and download applications. While iTunes and The Official App Store are the only places consumers can download apps for their iPhone, Android’s open platform allows merchants like MobiHand and HanDango to set up storefronts, ultimately providing more purchasing options for consumers. Google’s focus on improving its the user experience in its own Android market will also continue to boost revenues for app developers. For example, when the recent 1.6 OS (Cupcake) upgrade provided a much needed facelift for the market, we saw an immediate 18 percent lift in sales for our paid Caller ID application.

Billing Options Get Greener

While Google still has a long way to go in terms of reaching as many consumers as iTunes does, with the power of “what’s hot” and capabilities like in-app purchases, they have begun to enlist an armada of players—including carriers with deep experience in integrated billing—to create better markets for the merchandising and sale of applications. In early November, T-Mobile announced that they will launch their own Android market with integrated carrier billing, giving consumers the ability to charge applications to their phone bill. Also on the Google market roadmap is the ability for publishers to offer subscription purchases.

The low friction of bill-to-phone capabilities for consumers and the recurring revenue benefits of subscription services have the potential to drive significant revenue into the hands of developers. For example, we recently launched a service that allows consumers to text any number to 566587 (LOOKUP) to identify unknown callers and the bill-to-phone conversion rates have been two times what we have seen with the application market conversion rates. Thirty-four percent of our customers selected the unlimited subscription option over a single-use fee.

“Always With Me” Needs to be “Always On”

With the influx of more applications that require persistence—streaming music, Facebook, Skype, IM, & Caller ID—Android’s ability to run more than one application at a time is becoming more important. The “always with you, always on” benefits of mobile will be a key advertising opportunity especially for location-based offerings. Publishers will be able to use Android to generate more revenue by staying in front of users to produce more ad impressions. Advertisers also will be able to reach consumers closer to the point of sale, and take advantage of geo-triggered offers. Higher frequency of usage should also reduce churn for subscription-based services.

T-Mobile Got It Started Right, Verizon Will Unleash the Beast

T-Mobile launched the first Android phone in the U.S., and embraced the open platform. Any other U.S. carrier might have been tempted to meddle, but T-Mobile proved that an open platform would not be riddled with malware and abuse. With Verizon now going big on Android, we will start to see significant uptake. Verizon has 89 million customers with an average Data Revenue Per User of $15.69 to T-Mobile’s 33.5 million customers and $10 in Data Revenue Per User. Sprint has the highest data revenue per user of $19 and 48.3 million customers. In short, Verizon and Sprint will attract many more customers willing to spend more money on Android applications.

Android Needs To Be A Player, Not An iPhone Killer

For the same reason developers support multiple game platforms, browsers, and operating systems, Android just needs to achieve enough consumer scale to justify the investment. As long as Google stays focused on providing freedom in an open and competitive ecosystem, app developers will be rewarded. In just six months, we handily recouped our investment from launching an Android application and expect a significant return next year as Google leverages the reach and power of players like Verizon, T-Mobile, Sprint, Motorola, HTC, Dell, and Samsung to grow its platform.

Think Different

Future app developers should approach Android with more than a simple port of an existing iPhone application. Our initial interest in Android was motivated by innovation and new product features that required integration with core device functionality offered by Android but firewalled on the iPhone. Android’s absence of an approval process facilitates rapid product development and the open platform provides the opportunity to innovate, giving every developer the freedom to compete and earn a place in the consumer’s pocket.

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A new feature in Gmail Labs allows you to change your contacts’ circular chat status icons in Android logo status icons. But the key is that these icons only change for users who are currently online on their Android phones.

Google’s official stance on this is as follows:

These icons can help you decide whether to tailor your conversation to the type of device that your chat buddy is using. For example, when you know the guy on the other end is using his Android phone, you may decide to send shorter, more concise chat messages.

Of course, they don’t tailor these icons for any other type of phone, just Android. It seems if Google really wants to help with mobile chat experiences, they could also have BlackBerry icons, Pre icons, etc. I would bring up iPhone icons, but Apple would probably sue Google if they tried to use that — I wish I were kidding.

This is a fun little feature for Android users, and as I said, totally innocuous. But I do wonder what else Google has up its sleeve for cross promotion as they continue to move into new businesses. Remember, the Droid was already advertised on Google’s homepage, something they rarely do. And remember too what got Microsoft in trouble in the 90s: Bundling products with its dominant operating system.

Again, before everyone gets their panties in a bunch, this example clearly isn’t a big deal. But think forward a bit as the web becomes more and more of the dominant platform rather than the operating system. And Google controls that domain. And product creep is happening.

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Lots of people are saying there’s no way Google will enter the phone market directly and compete with all these handset manufacturers who have bet on Android. Daring Fireball, PC World and IntoMobile are among the doubters. And a lot of people are pointing to a Tom Krazit/CNET article last month that quoted Google’s Andy Rubin: “We’re not making hardware…We’re enabling other people to build hardware,” and “Rubin, vice president of engineering for Android at Google, scoffed at the notion that the company would “compete with its customers” by releasing its own phone.”

Normally I’d just point to the fact that many companies deny the existence of products until the day they announce them. Apple scoffed at the notion that they’d ever build a phone until they announced the iPhone, for example. The last thing Google wants is a lot of confusion among handset manufacturers just when those manufacturers are putting the finishing touches on their own Android phones.

But there may be another way Google will argue that they aren’t “competing with customers” by launching their own device – technically, it may not be a phone.

The Google Phone may be a data only, VoIP driven device. And Google may be lining up at least AT&T to provide those data services for the Google Phone, says one person we spoke with today.

Users could still make calls just like a normal phone, of course. The calls would just be over the data service instead. In fact, this is the exact vision Google proposed back in 2007 when they were bidding on the FCC auctions for the 700MHz spectrum.

Google can even issue phone numbers to users via Google Voice. In fact, I’ve already ported my mobile number to Google Voice, and Google has plans to roll out that feature more broadly. Google Voice can also handle the VoIP function for the phone.

Are AT&T and the other carriers interested? Our source says AT&T is already bidding for the business, and may be willing to sell data to Google, with certain conditions, for $20/month. The carriers won’t love this, at all. But they’d be dumb to let their competitors take the business instead. Our guess is at least the U.S. GSM carriers, TMobile and AT&T, would support the phone.

Our sources at AT&T have confirmed that they’ll sell data-only plans to customers who bring in BlackBerry and Windows devices, and strip out the voice plan. They won’t do this with all devices – you can’t get a data only plan on the iPhone, for example. But AT&T is open to data-only customer relationships.

Will the Google Phone be data/VoIP only? Right now we only have one thin source for this. But we’re continuing to dig.

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With fring, users can make free VoIP calls over Skype, MSN, Google Talk and via hundreds of SIP providers. The app also supports live chatting through ICQ, Yahoo, and more, and also boasts support for Twitter.

Fring on Android works over 3G, GPRS or WiFi connection.

Frankly, I’m surprised it took fring so long to come out with an app for Android. Rivals Meebo, Nimbuzz and eBuddy have long been available for the platform, so that gave its main competitors quite a head start and makes it way harder for them to acquire new users.

When I asked about the apparent delay, fring CEO Avi Shechter responded with:

Fring is the first [app on Android] to do free VoIP with Skype. We didn’t want to post a limited version with messaging only like all others but to provide full fring experience. Until now, Symbian and iPhone are the leading platforms and we’re focusing on higher-end devices where the experience is better, not like on low-end J2ME devices.

Israel-based fring has raised $23 million from multiple venture capital firms, most recently securing a Series C round of financing from North Bridge Venture Partners, Pitango Venture Capital, Veritas Venture Partners and VenFin Limited.

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But there were even better conspiracy theories out there, such as Engadget’s idea of a secret software update, which quickly spread around the Internet.

It turns out that wasn’t true, either. And we’ve confirmed that there’s no such thing as a secret software update on Android phones anyway, at least according to people at Google. Updates, even security updates, must be approved for installation by the user.

So what was the real reason for the problem, and the fix? Well, it fixed itself. The problem, as MobileCrunch duly noted, was an issue with the phone’s timestamp: “According to Google Engineer Dan Morrill, there is an unfortunate bug in the Droid’s autofocus routine. It improperly rounds a timestamp used in the calculations, which somehow throws the entire focusing process off. Today it works, and tomorrow it will work…but 24.5 days from now, the bug will be back.”

But by the time the problem cycles back again, Verizon will have pushed out a fix for the problem.

As we say around the office, Android is freedom from the iPhone. But sometimes that freedom feels a little bit like this:

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Developed by the guys at Big In Japan, ShopSavvy is an app that allows you to use your device as a portable barcode scanner. You point your phone’s camera at any barcode and it will read it, do a product look up, and give you information about the product, as well as where you can find it online or at nearby stores and for how much. Obviously, something like this is a window shopper’s dream.

And while you might think retailers may hate something like this, because it gives shoppers all of their competitors’ information, increasingly, they’ve been working with ShopSavvy to come up with ways to allow you to make buying in their stores even easier. And honestly, what are the retailers going to do anyway? All of this information is out there on the web, ShopSavvy just gives you easy access to it. Are they going to ban mobile phones in their stores? That’d be a great story for us if that were to happen.

So what took so long? Well, for a while, the iPhone lacked a key feature needed for the barcode scanner: A camera that had auto-focus. The iPhone 3GS gained that, and so the team should have been good to go. The plan was originally to release the app this summer, but a internal mix up involving a team member who had since departed registering the app to his iTunes account caused a delay (more on that here). After some back and forth with Apple, Big In Japan was finally able to get that resolved.

While it’s great to see this product on the iPhone, it is a little buggy right now. The main issue is that it’s hard to scan the barcodes properly. Big In Japan says a fix for that is coming shortly, based on what they’ve learned from beta testers, but keep that in mind when using the app for now.

My own tests confirm that it is a little hard to scan, but it seems to work most of the time. For example, I just scanned the protein bar I’m eating, and ShopSavvy pulled it up right away and gave me a pricing rundown. Nifty.

ShopSavvy is available for free in the App Store. Find it here. Also read about Big In Japan’s other big plan for the iPhone (100 apps in a year) here.

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One problem that has plagued a lot of Droid users is a malfunctioning autofocus. Take a close up picture of a barcode, or a high contrast image, or various other photo types, and the autofocus just doesn’t work properly. You can tell the phone has auto-focused when green frame lines are visible in the corners (another way is to view images after you’ve taken them and see if they are, cough, blurry).

A lot of people have complained about the problem, even our own guys over at MobileCrunch: “The main issue is with the auto-focusing system, primarily because it just doesn’t work.” Here’s a video of the problem. More complaints here.

Most users where hoping for a software upgrade in the near future that would fix the problem. But now some users are happily finding another, somewhat lower-tech fix – cleaning the lens with a soft cloth: “This works and sounds crazy. I just read that if you clean the camera lens really good with a soft cloth you will get the green focus. I’ll give anything a try so I did it. My camera now focus’s all the time. Green focus on all my shots. Supposedly there is a little bit of oily film over the lens and when wiped clean it fixes the issue. give it a shot and report here. I can tell you it worked lol…4 shots, all green….”

Everyone on the thread is responding that the “fix” is working (“I just cleaned mine and i got 6 for 6 green shots great find”). A few are saying that the problem went away on its own: “I noticed the camera working before out of nowhere too. Not to say a clean lens isn’t better, but they must’ve done something.”

The software has definitely not been upgraded on the phone. Our guess is those users who suddenly found their camera working properly have simply inserted and removed the phone from their pocket enough times that the thin film on the lens has now been removed.

Does it work for you? Let us know. My Droid never had autofocus problems to begin with.

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Currently, all Android Market browsing and transactions are done through an application that comes with the phone. This mobile application used to be pretty bad (it didn’t even offer screenshots of the apps), but was finally overhauled in September to be more competitive with the iPhone’s mobile version of the App Store. The new version is a big improvement, but browsing the store from the phone isn’t exactly a good time — you can only see a few apps at once, so scrolling through various lists gets tedious.

Contrast that with the App Store that’s integrated into Apple’s iTunes. Using iTunes to download new applications isn’t just something people do when they need an app to accomplish a certain task. It’s something they do for fun. Clicking through various top apps exposes plenty of high quality games, apps from popular sites like Yelp, and even the occasional productivity tool. It’s all very fast too — you can easily download fifteen new apps in a single browsing session without breaking a sweat.

Android doesn’t have anything close to that. The official Android Market website (pictured below) is a total joke. It shows a list of some of the top apps from its Paid and Free sections, along with a handful of screenshots. It doesn’t even have a full listing of the apps available, or any kind of search feature (as an aside, the entire Android site looks terrible — type in “Android” into Google, and this homepage is the first result). Yes, there are more comprehensive third-party listings, but there’s no way to download apps to your device without looking them up from your phone.

There’s an answer to this, and it’s one that’s right up Google’s alley: Google should rework the Android Market site into a full-fledged AJAXy web app, hopefully with the input of some talented designers. From a functionality standpoint the new Market should be a fairly blatant ripoff of Apple’s App Store on iTunes, with Top App lists, search, ratings, and so on (though there’s plenty of room for Google to improve on application discovery). Users would log in using their Google accounts, and use Google Checkout for payments. Next to every app listing would be a ‘Download’ or ‘Buy’ button. Clicking that would then send a notification to your phone, alerting you that you had outstanding downloads that could be sent straight to your device at your leisure. Large applications would require a Wi-Fi connection to download. Your Android phone is already tied to your Google account anyway, so the entire experience would be seamless.

Of course, there’s the argument that most people don’t buy mobile apps from their desktop anyway — AdMob recently conducted a survey(PDF) that found that over 90% of users download their iPhone apps Over-The-Air (i.e. they’re downloaded directly to the phone) rather than through an iTunes sync. That number sounds high to me, but it’s one that Google shouldn’t pay much attention to for a few reasons. For one, syncing with iTunes is a pain. Yes, Apple has made the process about as easy as it could given the bevy of options it has to include, but between the backing up, nebulous ‘Syncing’ messages, lengthy transfers from PC to iPhone and vice versa, it’s just a lot easier to download straight to your phone.

A cloud based push solution wouldn’t have those syncing issues — you’d be able to purchase apps from just about any computer connected to the Internet, and the only downtime required would be the time needed to actually download the app from Google’s servers. And even if the bulk of purchases would still be done directly from handsets, that doesn’t make a full fledged Android Market experience on the desktop any less important. Android Market is still very much the underdog to Apple’s App Store, and consumers considering an Android handset are likely turning to the web to scope out the applications available on Android to see how they compare to the App Store. Right now, Android fails that test.

Done properly, this setup would likely see the number of apps downloaded increase, as would the number of paid purchases (entering a credit card number on a computer is far easier than on a phone). And that would bring more developers to the platform, boosting the number of quality apps available. Of course, Android has a few other problems to worry about — some developers complain about the inability to install applications on a phone’s SD card, and there’s always the problems involved with developing for multiple devices running different versions of the OS. But turning the Market into something users can actually browse from their PCs is a good start.

Oh, and don’t be surprised if Apple adopts their own web based store some time in the future — they’re already experimenting with ‘iTunes Preview’ for music and video content.

Image via GearDiary.

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While Android 2.0 has been floating around on Motorola DROIDs for over a week now, one important chunk of it has been under lock-and-key: the source. Even amongst manufacturing partners, we’re told, Google hasn’t been completely open; outside of Motorola (and more recently, HTC), most of the other handset manufacturers have been left out in the cold with nothing to keep them warm but Android v1.6. Until tonight, that is.

As the sun set over the Silicon Valley last night, Google pushed the source code for Android 2.0 to the Android Open Source Project. Within two hours, the endlessly able Android community had it up and running on the eldest Android of them all, the T-Mobile G1.

Read the rest of this post at MobileCrunch >>

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While the tech-loving world continues to debate the merits of the Droid following its launch on Friday, it’s pretty safe to say that the Android platform has seen a pretty hefty influx of users as of late. In the past two weeks alone, we’ve seen the aforementioned Droid, it’s cheaper, younger sibling, the Droid Eris, and the Sprint Moment all hit the shelves; if any of them sold even reasonably well, there’s a lot of new folk cracking open the Android Market for the first time right now.

Whether you’re an iPhone convert, an ex-Nokian, or just a stranger to smartphones as a whole, the Android Market can be a pretty daunting place. While Android might not have quite as many apps as the leading competition, it still has a bit over 10,000 – and that’s a hell of a lot for any newcomer to weed through.

For the sake of these nascent newbies, we’ve thrown together a list of a handful of apps we think are worth checking out right off the bat. Got a favorite of your own? Throw it into the comments below.

Read the rest of this post at MobileCrunch >>

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Well, not exactly.

Apparently, Apple contacted Someecards a couple days ago because of some new content in the app — Someecards pushes new cards into the app just as it does on its site. There was one in particular that Apple did not find amusing, and wanted clarification on: A card making fun of President Obama Halloween costumes. It’s fairly easy to see why Apple wanted some clarification, the card involves race. Here’s what it says: “Just double-checking that your Obama costume will involve a mask and not shoe polish.”

Fans of Someecards will know that they use these types of provocative jokes all the time. The intent, it would seem, is not to be racist, but to use a joke to make a statement about race. “It’s kind of hard to explain humor, but I basically said it was making fun of racist behavior,” Someecards co-founder Duncan Mitchell tells us that he told Apple.

It is hard to explain humor. You either get a joke, or you do not. Apple, it seems, does not. “They said that they thought we could both agree we should remove the card. I said that we probably wouldn’t both agree that we should remove the card, but that we would remove it if they said we had to,” Mitchell says. “They said we had to.”

Anyone who has ever talked to just about any spokesperson at Apple will immediately relate to what Mitchell is saying. If Apple contacts you about something, they’re really contacting you to make you do what they want. If you don’t, there is often the threat of repercussions of some sort. In Someecards case, it would have meant pulling the app from the App Store.

As I’ve said many times, the App Store is Apple’s store, they can choose to do what they want with it. The problem is that Apple is perplexingly hypocritical when it comes to what apps get rejected and what apps get accepted. For example, apps that feature interactive Asian upskirt shots are fine. So are apps called Asian Boobs which feature young Asian women wearing next to nothing in sexually provocative poses. Also apparently fine is Mein Kampf, Adolf Hitler’s famous work.

For whatever reason, Apple has decided that anything having to do with making fun of public figures is prohibited. Though satire is protected in this country, it’s apparently not okay in Apple law. Apple literally has no sense of humor when it comes to that. But guess who does? Google.

In a seemingly coincidental bit of timing, Mitchell says that Google contacted him just hours after his call with Apple. They were calling to see if he’d be interested in making the app for Android. Their big selling points? “They pitched us on all the cool new phones that were coming out, and they also wanted to stress that they wouldn’t censor the app,” Mitchell tells us (emphasis mine).

Google, it seems, has a much better sense of humor than Apple. And they’re definitely playing their cards right in attempting to set up Android’s Market as a more open alternative to Apple’s App Store. With over 100,000 apps now, the App Store is a juggernaut that keeps on growing. But it would be a mistake to believe this growth will continue on in perpetuity no matter what. Apple should be careful about pissing off developers (which it has done plenty of times already) when an alternative like Android is finally gaining some momentum.

Regular readers will know that unlike a couple of my colleagues, I’m firmly an iPhone guy. Despite the advances that competitors are making, I still truly believe it is hands-down the best mobile device out there. But, as I hope you’d expect, I’m not above calling out Apple’s bullshit when I see it — as I do, very often, with regard to the App Store.

I simply believe they are making a mistake with the way they’re trying to contain this environment. At first, it made sense from Apple’s perspective because the company is all about controlling the user experience. But as the App Store continues to grow, the app approval model be harder and harder to maintain. What happens when we get to a million apps in the App Store? What about 5 million? Is Apple prepared to hire thousands of people simply to approve apps? The more they hire and the more apps that keep coming in, we’re going to continue seeing more and more screw-ups and hypocrisy. And developers are going to grow more and more frustrated. This situation is simply not tenable.

Lighten up on your heavy-handed rules, Apple. And just lighten up in general.

[photo: flickr/swami stream]

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As a small team, Gowalla, like its rival Foursquare, doesn’t have a lot of resources to devote to building apps on all the mobile platforms, so this is a good solution for the time being. Eventually, the plan is to have native apps for all the big platforms, Williams says.

But the most-loved child will remain the iPhone app for the foreseeable future. In fact, version 1.3 of that app has just been submitted to the App Store for approval, we’re told. Williams says that it should alleviate a lot of the check-in and place adding issues that users were experiencing in previously versions, which we touched on here.

Yesterday, Gowalla also added Twitter feeds to venue pages on their web site. This allows you to see what the official Twitter accounts for those places are saying at any given time. They also began appending place’s Twitter names to your tweets when you check into a place on Gowalla. See an example here.

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Launch day of a new cool gadget is the closest thing to being a kid again on Christmas day (or whatever your winter solstice holiday of choice). You’ve anticipated the day. You’ve called in sick to work. And you are standing out in the freezing cold at 7 in the morning, hoping your place in line assures you a device before the carefully-planned sell out occurs. You’ve worked yourself into…a Fever Pitch.

I’ve always been let down with the real world gadget after that high of anticipation. But that’s ok. It’s part of the cycle of tech.

Today is Droid day. In just a few hours Verizon stores will open and the first customers will get their hands on their very own Droid.

And I promise you, if you are one of the people waiting in line, you will have a much lower than average amount of letdown. That’s because, in my humble opinion, the Droid is the coolest mobile phone to exist to date. It is as close as we’ve come to the Platonic ideal of a smartphone. Its very existence ensures that the next iPhone will be even better than it otherwise would have been. Competition is good.

Yes, this is an unabashed love letter to the Droid. If you want the dispassionate reviews, we’ve got em. And then some. That isn’t what this post is about.

This post is about love of technology.

I’ve had one of the devices, a free loaner that I wasn’t ashamed to beg for, for a week now. I’ve assigned it to my Google Voice account and have used it and only it since it arrived.

I have placed it in the car doc and have used Google Navigator to get around, shunning my expensive but suddenly dated in-car navigation system. I talk to my Droid. And it talks back to me, guiding me to my destination.

I have installed a dozen apps on my Droid, and all run smoothly in the background. Skype, Yammer, Twitdroid and Google Voice all let me know when something is happening that I need to be aware of. There is no lag when I open these apps. Even when most of them are running at once.

And when I respond, I can choose between the quick virtual keyboard or the slider real keyboard. And I notice how slim the device is, about the same as the iPhone, even though it has a physical keyboard.

I make calls from my home via the robust Verizon network, something I had to forgo in my AT&T/iPhone days. My voicemails are transcribed automatically by Google Voice and delivered via email, along with my text messages. Not one call has been dropped in a week’s use.

I view web pages in the gorgeous 3.7″ WVGA (480 x 854 pixels); 16:9 widescreen. And the scrolling speed on web pages is faster than even my desktop computer.

Droid is the Alpha phone. And I will love it and only it. Until something better comes along.

Happy Droid Day. Let me know what you think of yours.

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The company has set a goal to release 100 apps before the end of 2010 for the iPhone. How are they going to do this? By pulling together a bunch of developers from around the U.S. to make an app development power house. Currently, the team has assembled 25 developers and 25 user interface guys to work towards the goal. The team members mix and match, pairing up to do one app at a time. When they complete that one, it’s on to the next one, with a new set of partners.

The concept is actually much more straightforward than pulling new app ideas out of the blue and making them. The reason Big in Japan decided to do this was because they were being approached by so many brands and companies to help them build iPhone apps, that there was no way Big in Japan could keep up with the demand the way the team was previously structured. So now, when a new app request comes in, Big in Japan looks it over, decides if they think its a good fit for their large team to do, and then pass it along to the app developers.

And it’s a good deal for the developers because they are all working together towards a common goal: Money. The way the model works is that this pool of developers collectively own half of the company (which is a sub-division of Big in Japan). As such, they get half of the revenue from the company to split up between them. So the better each of them do, the better they all do. And it’s based on a country club model, Big in Japan co-founder Alexander Muse tells us. Basically, these developers buy their seat, but if they decide they want to move on, they can sell it to someone else.

Muse expects that 25 apps will be launched this quarter from the project. And he hopes to continue that pace through the end of 2010. Realistically, he admit that maybe only 80 or so apps will actually be available when all is said and done in the App Store. He, like everyone else, realizes that it can be tricky to get apps approved at times by Apple, and he suspects that some developers will get fed up and simply stop working on those apps. Still, 80 apps in a year from one house would be very impressive.

Big in Japan made a name for itself with its ShopSavvy application, which won the Android Developer Challenge last year. ShopSavvy still has yet to launch for the iPhone, but Muse recently wrote that it will be launching very soon.

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I was sorting through my notes and video footage of the Google press event around the launch of Google Maps Navigation for Android 2.0 and saw this gem. It’s a minute or so of footage of Google CEO Eric Schmidt talking about the potential of today’s mobile platforms when combined with the cloud.

The mobile platforms, Android and the others, are so powerful now that you can build client apps that do magical things that are connected with the cloud. This is I think the most visually obvious example of that…don’t limit your imagination to this set of problems. Anything where you can produce this phenomenal customer benefit when you have a mobile device broadly defined connected to the cloud….Obviously we like the price of free because the consumers like that as well and we can figure out ways to use advertising to pay for it.

His words echo Arthur C. Clarke’s famous quote “Any sufficiently advanced technology is indistinguishable from magic.” Schmidt says that today’s mobile platforms are so powerful that when combined with a robust cloud service they can do “magical things.” And he encourages people not to limit their imaginations when thinking of new applications to serve people.

Inspiring stuff for people out there thinking up the future.

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When Google announced what is clearly the best car navigation application on any mobile today, it didn’t just take a swipe at GPS navigation companies such as Garmin and TomTom. It took a swipe at Apple.

Beyond the advanced features of the Google Maps Navigation app (voice search, crowdsourced traffic data, Street View navigation), what makes the app noteworthy is that it launched on Google’s own Android phones first rather than on the iPhone. By doing so, Google is putting Apple on notice that it is no longer reserving its best apps for the iPhone.

Navigation apps are a key category for mobile phones, and the iPhone is for once at a disadvantage here. Even the paid navigation apps in the iTunes store can’t compete because Google’s new navigation app is an extension (albeit a customized one) of its search engine. When a navigation app becomes an interface to Google’s massive search engine, it begins to deliver things that GPS app developers like Garmin and TomTom will never be able to build (search along a route, natural language search). Oh yeah, and did I mention it is free?

This is but the latest sign of a growing rift between Apple and Google. A couple years ago, when the iPhone first launched, Google and Apple had a strong partnership. At the time, Google CEO Eric Schmidt described the relationship as so close that it was akin to merging “without merging. Each company should do the absolutely best thing they can do every time.” Google supposedly didn’t need to create its own phone, because it could simply create software for the iPhone. And, in fact, some of the best apps on the iPhone—Mail, Maps, YouTube, Search—were developed by Google.

Only two years later, Apple and Google no longer have such a cozy relationship. A new Android phone is now launching every other week, it seems. Feeling the competitive threat, Apple started blocking Google apps such as Google Voice and Latitude from getting on the iPhone, and Schmidt stepped down from Apple’s board (although there were also other reasons for that having to do with antitrust scrutiny).

The tensions really came to a boil around the whole Google Voice saga. As we wrote at the time:

Multiple sources at Google tell us that in informal discussions with Apple over the last few months Apple expressed dismay at the number of core iPhone apps that are powered by Google. Search, maps, YouTube, and other key popular apps are powered by Google. Other than the browser, Apple has little else to call its own other than the core phone, contacts and calendar features.

So Apple starts to back away from letting Google take over the iPhone with all the best apps by rejecting them. And now we have Google’s response: a big middle finger. If Apple is going to make it hard to get on the iPhone, then Google will stop giving Apple its best apps first and use them to make its own Android platform more appealing.

Apple is in a terrible position here because the future of mobile apps are Web apps, and Google excels at making those. Apple needs Google, it’s most dangerous competitor in the mobile Web market, to keep building apps for the iPhone. Google would be foolish not to since the iPhone still has the largest reach of any modern Web phone. But it will no longer be a priority.

The sad thing is that Apple has been here before—with Microsoft. In the late 1990s, Apple had to beg Microsoft to keep building Office for Macs. Now it may be in the same position with Google. There may be more than 85,000 apps in the App Store, but it is only a handful which actually drive purchases. If Google Maps Navigation becomes one of those types of killer apps, Apple might need to do some begging first before Google goes through effort to make it for the iPhone.

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Google released a new mobile navigation app today and GPS navigation companies such as Garmin And TomTom saw their shares take a plunge. The announcement shaved $1.2 billion off of Garmin’s market cap alone. Its shares are down more than 16 percent so far today to $31.60. TomTom’s shares are down 21 percent to $8.11.

And this is just for an Android app. But Google could very well make it available to other phones as well, and that is what has investors worried. GPS navigation apps are among the most expensive, and most lucrative, of all mobile apps. TomTom sells its iPhone apps for $50 to $100, with a different app per country.

Google just cut the traditional GPS navigation companies at the knees by releasing what may be a far superior product for free. It is not a standalone navigation app. Rather it taps into a lot of the resources Google makes available on the Web, including Google Maps, Streetview, voice recognition, and sophisticated search. You can use voice search just as you would look for something on Google’s search engine. “Where is the Pizza Hut in downtown Palo Alto”? If Google’s search engine can find it, then so can Google’s navigation app. Garmin and TomTom can’t compete with that kind of Web-scale computing power.

And Google is happy to give its navigation app away for free because it leverages many existing technologies it has already built for the Web, and it encourages more people to use Web-capable phones and do local searches on them. Its strategy is to give the software away for free, and make money on the search ads.

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