Ultimately when you decide to build a product for general sale you have three choices:
1. Invent something
2. Copy something
3. Enhance something

Each of these has its strengths and weaknesses. For #1 you have to really have a good idea and you have to bear the burden of educating the world they need something they never had before. In path #2 you have to make sure you can do it so much better that you can overtake the current vendors. And with #3 you build an add on to an existing product as part of its ecosystem, so that means your only customers are the people who bought the thing you are enhancing.

None of these is easy and none is a "sure thing". I find that it is a slow road with luck and hard work playing equal roles in most cases. Misjudging the market is a common mistake, but not doing any market research ahead of time is by far the most common mistake.

Our head developer of our FSM product, Amr (he specifically asked me to mention him when I told him I planned to blog about this), throught that it might be a good idea for us to develop a Facebook Application. My response was to point out that Facebook, iPhone apps and other applications seem like a great way to get rich, but the failure rate is enormous my research says that it costs tens of thousands of dollars to bring one to market successfully as very, very few make any money at all the average lose money if the idea is good enough then you have a better chance, but everyone thinks they have the killer idea. The costs go way up if you advertise it with some having spent as much as a million dollars. There really are no shortcuts to wealth

You should never just build an application. You should first figure out the odds of it actually making money otherwise you spend your life just writing code and never make any headway.

The key is to jump in before the market gets too saturated and to do some pragmatic thought about the potential of your product idea. Rather than look to Facebook or iPhone apps I think Windows Phone 7 applications is a much better landscape since there is still room for new players to make a mark. Just remember that you have to tamp down your wishful instincts...