Remember Apple's "There is an App for it" commerciale?
Unlike Apple's walled garden approach, Google honestly believes software should be free, and accessible to everyone - even to the 10 year old who just want to have a picture of his teacher produce a fart noise every time you click on it. Thanks to Google's App Inventor, there is an App for it as well!
Like MS-BASIC for the IBM DOS days and Visual Basic for the Windows days - App Inventor can play this rule for the SmartPhone era. One of the reasons that made the IBM based PCs so popular in those days was to ability to easily write programs using the BASIC programming language. Programs can be written relativly easy, and distributed freely. Same is true for Visual Basic - that revolutionized Windows application development.
Sure, there are many visual programming languages out there that make it easy to build small and colorfull projects - however, this time it comes to your PHONE. Just imagine the options which now become available: from coffee shops building an app for their menu, artists that can product a business card in the form of an Android app, or even start-ups for a product mock-up or demo.
Google's marketing effort to position this as a K12 learning tool is brilliant - Next time a kid asks his parents to buy him an Android smart phone, he must not forget mentioning its educational properties as well...
Google looks to fully utilize the phone capabilities with this tool. From early drilling into the product documentation it looks as most of the phone capabilities will be accessible: GPS, SMS, call creation and termination, web browsing, and so on. This is not just a tool that can create Apps to display nice pictures and sound, but something can be easily find legitimate business causes to use.
So Apple, what would be your reaction? Can you bit this brilliant move?