John Albright and Kevin Talbot (Photo:Nigel Dickson, CNN/Fortune)

What is a “winning application?”  Is it how cool it looks on your smartphone?  Is it how productive it makes you on the go?  Mobile application developers are constantly coming up with new and innovative solutions that bring more function to our smartphones.  So, how can a developer get their application in front of companies and users to be a winning application? I spoke with Kevin Talbot, Managing Director of RBC Venture Partners & Co-Managing Partner of the BlackBerry Partners Fund to get his take on a “winning” mobile application.

I found out that there is not an arms-length checklist, but merely three things that he — and the other members of the Partners Fund — look for in an application.  So, what three things can make an application go from relative obscurity to receiving prizes valued at $100,000, tons of press, being featured on an application storefront and even a possible venture capital investment?

BlackBerry Developer Challenge in San Francisco, November 9th, 2009.

It turns out the magic formula is not a secret kept under lock and key, but a simple view that your smartphone is at the center of your digital life.  It goes where you go.  It is your computer.  It is your wallet. Your smartphone is an extension of you — and accesses all of your digital photos, music, video, and games.

The first thing that Kevin and the members of the BlackBerry Partners fund look for in an application is whether it enables you to do what you need to do — on the go.   Sure, people carry laptops and netbooks, but our smartphones are almost always with us.   The expectation is that we should — and can — be able to do any task from our smartphone that we would do with a computer.

Check and respond to emails, instant messages, and, yes, even calls.  Surf the web.   Create and edit documents.  Even remotely access your computer (or admin a server) directly from your smartphone.   While the memory and processing power of smartphones does continue to increase, Kevin pointed out that the devices already serve as extensions of our home and work computers.  We access information constantly, and use our smartphones to easily output updates and information to our friends and colleagues.  How many times have you been in the office and seen co-workers using their smartphone to respond to emails instead of waiting to sit back down at their desk to type it out on their Mac or PC?

Today’s mobile professional will even save presentations to their smartphone, remotely access the file back in their office, or just email themselves a copy.  They may do it as a “backup” — but Kevin sees the opportunity that most professionals want to not have to worry about carrying another bulky laptop on another business trip.  There will always be desktop, laptop, and netbook computers.  The expectation is that the smartphone will be able to do the majority of these functions — and fit in your pocket.   There are few things that our mobile devices cannot do today.  That’s one of the key features the BlackBerry Partners Fund is looking at when deciding what makes a “winning” application.

The next thing that the BlackBerry Partners fund considers is whether the application helps promote the use of your smartphone as your wallet.  Think about it.  Money is already digital. Sure, we agree that plastic, paper and coin will be physical representations of money during exchange.  There’s no reason that the digital exchange should not occur directly from your smartphone.  Mobile commerce and mobile payment solutions are already in play.  Qualcomm’s Firethorn Mobile is but one solution that already caters to providing the backbone for mobile banking for many wireless carriers and banks today.

Mobile barcode scanning, mobile coupons, and payments using only our smartphones are the obvious next steps.  Whether the payments are via near field communications and smart chips embedded within our phones, or via an application like Verisign’s Identity Protection Mobile Center, we’re already well on our way to eventually leaving an over-stuffed wallet behind.   Wallets packed with receipts, paper photos, and bills may be a thing of the past.  Why not just scan and use your iPhone or BlackBerry?  Sound too far fetched?   So did surfing the web on the “tiny” phone screens just a few years ago.

The third item, or category, that Kevin and the BlackBerry Partners Fund consider is whether the application makes use of promoting the smartphone as the center of your digital lifestyle.   Today you can whip out your BlackBerry, iPhone, Palm Pre, DROID, HTC Hero, or a host of other smartphones and access your Facebook account, show your Flickr photo albums, and stream music without carrying several separate gadgets.  It can all be done and managed right from your mobile device.  It’s gotten to the point where making a phone call is almost — almost! — secondary to the other features provided.

At the end of the day, innovation is what is being sought.  If the application meets the three aspects above in a new and exciting way, then it is by and large considered a “winning” application.   Another consideration is how the application engages the user.  Is it something that you or I would download and then use for only a day?  Is it “disposable” instead of something that enriches our daily user experience?   Sure, there are apps out there for everything — and that is certainly a good thing as there is something out there for everyone — but how many apps do you or I use day in and day out? How many apps did you or I purchase last year that are still on our handhelds today?

Now that we know what the three main things the BlackBerry Partners Fund looks for, how does the winning DevelopIQ application for 7digital fit the bill?  The “smartphone as a computer” aspect is seen in how DevelopIQ made their application a mobile music storefront for the BlackBerry Platform.  Not only can users browse and purchase music in the app, but they can play their own music collection directly within the same application. That sounds like a very small distinction, but think about it.  DevelopIQ integrated the features within a single application, meaning a user does not have to exit their app to play music versus purchasing music — say, like an iPhone user would have to do when switching between the device’s App Store and the iPod feature.

It’s a small item to gloss over, but it means that the 7digital application fully engages the user and gives them the ability to stay in the application to manage all music-player features and purchases.  You’re not tied to a Mac or PC at all.  You don’t need to sync anything.  The 7digital application gives you full untethered control.  As a music player for BlackBerry, these are innovative features that are available today from this application.  From the BlackBerry Partners Fund perspective, as the features of the BlackBerry smartphone grow, the ability of the application will likewise evolve.  Music videos?  Movies?  The 7digital application could certainly move to become BlackBerry’s answer to iTunes.  Will those types of features be able to mesh with — and complement — the BlackBerry App World?

What about the wallet feature?  The application allows direct on-device purchases and wireless content delivery.  Long-term, it would be great to see BlackBerry Wallet or additional payment options integrated into all applications (right now, you would have to set up your profile and payment options on the 7digital website first in order to make purchases from the on-device application).  What Kevin and the BlackBerry Partners Fund see with the application is how it’s innovative approach lends to easily integrating more features and making the long-term smartphone experience appealing to users’ needs. As for the application promoting BlackBerry as the center of your digital lifestyle? Not many people readily associate BlackBerry with music or media — and this application is one that helps change that perspective.

There are challenges. In speaking with Kevin during the event, pricing was an obvious challenge.  Not the base price points of applications, but the discrepancy among platforms.  Apple was very smart in how they approached the mobile storefront ecosystem with iTunes.   Once you had an iPod you had iTunes.  Then you were, for the most part, locked in to that seamless structure to get music, apps, etc.  Obviously, other platforms would certainly like to be able to give the same one-stop-shop environment.  Apple was also the key force in a certain mindset regarding mobile applications:  price.   People expect an app to be free or close to free at $0.99, $1.99, etc.   One application may be one price on Apple’s platform — and then three times that price on the BlackBerry platform.

Kevin sees that discrepancy eventually leveling off as more developers design applications for the BlackBerry.  RIM really bent over backwards to give developers just about every reason to easily develop for the platform.  The times of an application being $9.99 for iPhone and $29.99 for BlackBerry will have to change.  The key is that the application is meaningful and useful for the user.   In the end, for BlackBerry, the application has to be one that is downloaded and kept on the device.  If it’s simply uninstalled after a day or a week, developers won’t be making any money long term. You may see those types of apps fade away from the BlackBerry platform quickly, and you may see similar application pricing more in line across each platform; simply due to the demands of the market and the user.

As for a “winning” application’s business model?  That question is the most frequent posed by the BlackBerry Partners Fund to developers.    Will the application have a one-time up front charge?  Will the application’s revenue be advertising based?   Will the application implement the “freemium” model where a lite or limited feature version is available, giving users the option to choose to upgrade to a paid version?  Will the application be subscription based?   Kevin believes most applications will turn to the “freemium model” as it attracts more users, while giving the developer the opportunity to add features and continue work on the application from the revenue brought in from user upgrades to premium features or content.

Subscription models, on the other hand, is not a business model Kevin saw as working out for the developer or the user. Kevin pointed out that “people like to own the content they pay for.”  Adding “If I purchase music or any content, I want to be able to access it and use it how I choose — and not worry if I will lose everything if the developer goes out of business a year from now.”   While some carrier-based subscription models do seem to be working — a good example is the TeleNav GPS service that users can be billed monthly to use right from their wireless carrier — the problem is that the subscription model offers little in user engagement.    Kevin admitted that he’s had TeleNav from his carrier installed, and has paid for the service on his phone bill, but rarely uses the service.  In that respect, sure, it’s giving revenue to the carrier and the developer — but it’s not something [Kevin] is actively using daily, and is a feature he’d likely be looking to cancel.  Many users absolutely love TeleNav and other subscription services, but the model won’t work for many developers.  Kevin recommends mobile application developers take advantage of the “freemium” business model to attract the most users.  ”Too many potential users will be turned off by a recurring charge.”  The objective is to get your app out there and used by as many people as possible.

As for the “smartphone wars” between each device and platform?  Kevin says that we’ve not seen anything yet.  ”As the ecosystem matures, and more and more devices hit the market, consumers will have so many choices that it’s going to drive more innovation and more features.”  As for BlackBerry?  Kevin looked ahead to the features he saw developers bring with this year’s Developer Conference.  ”Take a company and product like Xobni.  [The BlackBerry Partners Fund] decided to invest in Xobni after seeing what they were doing.”  While Xobni wasn’t in the Developer Challenge, the presentation made during DevCon turned many heads.  ”Xobni has designed an application that interacts with features already on the BlackBerry.”

Kevin sees this as the direction the platform must move towards.  While multitasking and the ability to run multiple apps in the background has always been an advantage for BlackBerry, what Xobni showed was a way for developers to use features of other applications and have these apps interact with each other to provide data and features we wouldn’t have dreamed of even a year ago.  In short, an app would be able to work with other apps without forcing the user to close or switch between them on the device.  This feature was called “flow” during the developer conference, and was something RIM was clearly interested in pursuing on the BlackBerry platform.  Palm’s WebOS brought the user “synergy” and the iPhone has brought “spotlight” capabilities to search, but there is an opportunity here to bring something even more unique to the smartphone ecosystem.  Will developers be able to design applications that complement and work with each other?  Will RIM be able to pull it off?

Let’s see what the developers bring to the 2010 Challenge.