Utilities vs Networks
It's interesting to see a network, Instagram, starting to replace the iPhone's native camera application in many users' daily usage of their phones. I see this in my kids' behavior all the time. When they want to take a photo, they open Instagram, not the camera application.
In the PC era, when applications got bundled into the operating system, they became instoppable. All the competitive apps got left in the dust. But in the mobile era, it seems that a different dynamic is at play. The native applications are getting beat by networks. And these networks will eventually go cross platform which means that the native applications will be at an even greater disadvantage.
I expect we will see this happen not only with the camera application, but also with the calendar app, the contacts app, the to do list, etc, etc. Clean, simple, networked, social, cross platform mobile apps will be the winning model in the mobile ecosystem and the OS vendors will not be able to maintain dominance with the default apps they ship with the OS.
Networks beat utilities in the age when everyone is connected to everyone else. This is a big opportunity for startups. We've already got a few bets in this area and are looking to make more.