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The future of the app industry

With the app market reaching some form of maturity many have suggested that the app economy is in a decline. So when I got an email from Mark Armstrong, vice president and managing director EMEA, telling me that the app economy is booming I had to find out just what he was on about. In this interview we talk all about the app economy, the best path for app developer, and the future of BYOD, IoT and apps.

A number of studies have shown that the number of apps that people buy has declined, and most people install a single app every two weeks. And arguably the various app store fronts have reached saturation point with multiple entries for apps that have the same basic function, so why do you think the app industry is booming?

I believe that rather than showing signs of weakening, the app economy is in fact displaying the typical signs of a market maturing. Consumer spending power and willingness to adopt new technologies paved the way for the tremendous growth the app economy has witnessed to date.

The fact that consumers are downloading less apps is not a sign of saturation, but rather that a greater emphasis is being placed on quality over quantity and the value users can extract from an application. The industry is now shifting quickly from siloed, “good enough” apps to creating much more compelling and robust experiences.

Alongside this demand, there is also an evolution occurring – with the rise of the citizen developer, and new revenue opportunities to be found, app development is maturing and moving beyond the consumer market. In 2009 Gartner predicted that, by 2014, 25 per cent of new business applications would be written by staff outside the IT department - or "citizen developers" as it called them. This has implications for the Independent Software Vendors (ISVs), whose solutions will be challenged by in-house developers creating their own software.

Forward thinking ISVs are utilising their IT systems and their inherent data in new ways to offer customers new and innovative services through applications, essentially turning them from ‘systems of record’ to ‘systems of engagement’.

The app economy is changing and maturing with business to business app developers showing they are ready to take the lead in driving innovation and growth. According to Vision Mobile, 16 per cent of the application developers who target the enterprise market make five times more money than those who target the consumer market.

For apps in business to be adopted repeatedly, the onus will be on the need to deliver real business value. While quality is key, the apps have to have an end game.

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BYOD, app, IoT

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Target the "Enterprise" market...[/caption]

With businesses coming to the realisation that BYOD is not a fad but a shift in the way we work, is the market for in-house apps that the business can control and secure growing?

By this I mean “corporate apps” designed purely for internal use. Have you seen any examples of this in the “wild” and how wide-spread do you expect this trend to grow?

Being able to respond to changes has always been imperative for any business, yet the sheer speed at which these changes are appearing has forced the need for a new, more efficient and flexible approach to the tools and devices employees use at work.

You are right when you suggest BYOD is being taken more seriously; according to a recent survey (opens in new tab) of senior IT professionals, conducted by Samsung, 90 per cent of companies will have adopted a bring your own device (BYOD) policy by the end of this year, showing that the consumerisation of IT in the enterprise is no flash in the pan.

This trend will drive the uptake of both consumer and enterprise apps as a means to enable more efficient access to information on smart devices. While some security concerns remain as to how these apps are used and secured, the advancement and uptake of mobile device and app management solutions will help many companies realise the potential that comes from the introduction of apps in-house.

According to the same Samsung survey, 90 per cent of companies are hanging their hats on internal applications to improve access to business critical data that will help inform key decisions or simply help speed working processes.

From simple ‘corporate’ applications that compile data from siloed spreadsheets so that it’s easier to analyse, to more complex apps for data analysis, we expect internal apps of all sorts to become prevalent in the next five years. Each business will develop and use them differently, according to their needs.

The emphasis on bespoke applications will create a step-change in the way apps are consumed. As businesses move away from packaged applications to tailored apps for unique departmental requirements, CIOs will need to rethink how to strategically plan, prioritise and manage the application portfolio and its architecture.

In 2015 we’ll see organisations move towards the promise of the IoT across a wide range of industries. Initial steps will be taken to assimilate IoT processing into internal and customer facing applications, including increased use of IoT friendly languages like Node.js.

I do not believe that we will see a wealth of ROI success stories in the short term; it is much more a case of businesses establishing processes which will set them in good stead for the future. Those that don’t begin planning or modifying their development processes risk falling behind more forward-thinking competitors.

In mobile app development, we are also witnessing an interesting trend. The first era of mobile apps is characterised by a rush to build apps targeted at all mobile users—regardless of audience or purpose.

However, this “one-size-fits-all” app strategy is coming to an end. As we enter the second era of mobile application development, developers are being more thoughtful and careful to focus on the mobile experiences and how users engage with different kinds of apps. Using this knowledge they can now properly adapt app development to address these behaviours.

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app development

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The app market's moving to become a more tailored service[/caption]

You cite Uber as an example as to why rapid app development is critical, and consumer-focused businesses need an app channel to compete with these new companies.

What lessons can businesses in less consumer-focused sectors learn from this and how can they implement said lessons into their overall strategy?

Apps like Uber have succeeded because they identified where a traditional business model was failing by making people wait for a service. They solved this problem. Similarly, restaurant apps that enable you to order your food and pay your bill at your table cut short waiting times and inefficiencies.

Apps such as Uber deliver a service by taking real time contextualised data – such as location based information – to join customer with driver. This isn’t new. It was solving a common problem that made it successful.

The enterprise will not do anything vastly different when it comes to application development –employees are, after all, consumers who also want to cut inefficiency and waiting times. The success of each enterprise app will depend on the size of the problem it aims to solve and the ease with which the app can solve it.

Enterprises will realise that they are sitting on mounds of useful data in their systems of record, such as ERP systems, and should start to think about how they can access and use this. To apply an industry analogy, data is like oil: it’s valuable but if unrefined it cannot really be used. Enterprises need to be capable of drilling for data, connecting different data pipes and refining it to build business applications that cut inefficiency and help reap real business benefit.

Lastly I understand that you’re a huge Rugby fan, (and perhaps this is a question I should be asking your colleagues) what is your favourite/most-used Business-Rugby metaphor?

In rugby it is not about crashing through but rather all about making space for others to exploit; managing people and business is no different…oh, and I’m not keen on hospital passes either!

Massive thanks to Mark for chatting to us, you can follow him on Twitter @markarmstrong66