Fred Wilson states the obvious. "Web is flattish. But mobile is growing like a weed," he wrote in a recent post on his blog.
Smartphone subscriptions worldwide were about 700 million in 2011 and are expected to grow to an estimated 3 billion in 2017, according to a recent report from Ericsson (PDF). Add in mobile PCs and tablets with cellular connections, and the numbers grow from 850 million in 2011 to 3.8 billion in 2017.
But Wilson, a venture capitalist from Union Square Ventures, with investments in hot startups such as Foursquare, Tumblr, Twitter, and Zynga, sees around the corner as it relates how the shift from web to mobile will impact the form and design of apps. He wrote:
Mobile does not reward feature richness. It rewards small, application specific, feature light services. I have said this before but I will say it again. The phone is the equivalent of the web application and the mobile apps you have on your home screen(s) are the features.
That is why Facebook should (and it looks like will) break its big monolithic web app into a bunch of small mobile apps. Messenger, Instagram (not yet owned by Facebook), and Camera are the model for Facebook on mobile.
Wilson maintains that more focused apps, such as Foursquare and Instagram, are best positioned for the mobile transition, not Facebook or Google.
Facebook, for example, was built from the ground up to be social and is now trying to graft mobile into its genetic code. In better adapting to the mobile world, Facebook's News Feed or Messages, like Camera, could be instantiated as their own apps, with icons on a smartphone or tablet screen, separate as well as integrated into the monolithic mobile app.
Wilson contends that Google and Microsoft have become non-factors in key new markets. As the Internet continues its rapid evolution, he believes Facebook will also struggle to keep pace -- as it has in lagging with mobile -- and avoid missing the next major shift.
The 8-year-old Facebook has already taken Wilson's advice to heart in plunking down around $1 billion in cash and stock for the less than 2-year-old Instagram.
Google was born as a search engine and married an advertising engine. With its vast ambitions, Google is not exactly a non-factor. The company is applying massive resources to advance its Android platform and embed social, with Google+, and mobile deeply within its growing software realm. Similarly, Microsoft is pushing its forthcoming Windows 8 across desktop and mobile devices.
But the platform play is dependent on apps to drive adoption, and on that basis Apple has a well established the lead. The analytics company Flurry estimates that in Q1 2012,and that developers earn four times the revenue on iOS versus Android.
Wilson concludes that entrepreneurs, who are more adept at riding the innovation waves and creating compelling apps than the behemoths stalking them, are the ultimate winners in a dynamic marketplace -- just ask Instagram:
All of this is good news for entrepreneurs since they are in the best position to take advantage of all of these changing dynamics. It is not as good news for those who find themselves operating a big Internet business started more than five years ago. You are going to need to make a hard right turn super fast without flipping over the car.