What is all this talk about enterprise app stores about?

Iced tea at Georgia's, version 2We are moving into app economy and that is happening very fast. There are many predictions on the marketplace on this trend with Gartner forecasting that 25% of enterprises will have their own enterprise apps stores for managing corporate-sanctioned apps on PCs and mobile devices – all this within 4 years. Others are saying that this is already happening and it won’t take four years. Whatever the case is, ISVs needs to pay attention to this as CIOs in large organizations need to take control of the situation with deployed apps both in tablets as well as smart phones.

I think there is a big misconception in the word “app” when thinking about business models. Many relate an “app” to small apps used by smartphones with either free or almost free business model. These are mostly consumer-focused apps, but the trend is that consumers will be using their smartphones to conduct business using apps, but these apps will be connected to backend cloud solutions that bring the scalability and logic to the game. Look at an app as just the UI to full-blown solutions where end users can run their business with small devices or tablets and use the cloud infrastructure as foundation.

The forecast for App Economy is huge and according to APPNATION, App Economy is going to reach $151B by 2017. What it really means for ISVs and any software developers organization is that they need to really get a better understanding how app economy is going to impact them going forward. CIOs will be asking questions how an ISV will support enterprise app stores and how the ISVs will support these app stores with their solutions. I am a bit amazed how little there is discussion off apps in our workshops but I think this is going to change going forward. Based on the study by APPNATION, the majority of mobile device owners under 45 years are using video apps and this supports my previous blog entry of eLearning.

There will be a need for both consumer-oriented and enterprise-oriented apps stores and it will be a space that will bring new opportunities for many players. The competition in this space will be based on innovation of solutions that people want to use and the use is measured on how much content the apps consume from the cloud. It is not rocket science, but it is a new world that people need to get used to.

In the end of the day, apps will have to be monetized in one way or the other and that is where the subscription economy comes to play and organizations need to understand how to price their solutions and all this based on value pricing.

App Ecosystem and APIs

Design by connectionI am a big proponent of APIs (application programming interfaces). Many of you might think that I must have a sick sense of humor, but I am seriously excited about this topic. We have finally moved to a new era where software development is moving away from trying to build colossal solutions that take years to implement and are hard to use. I gave an example of this in one of my previous blog posts how PowerObjects have been able to solve a business problem for me.

I am a true believer in assembling solutions of top-of-the-breed solutions and not trying to reinvent the wheel. If you felt a pinch in your heart, you should think about this and how you develop your software within your organization. Are you building things that already exist or are you building things that provide value-add to the overall solution based on your own core competence? I have led development teams an built more than 30 international software products with my teams, so I know what it means.

Application programming interfaces (APIs) can change your business and is a way for you to transform your business. It enables smart developers to create functional entities (consumable services) that can become a part of a larger entity. You do not have to go far to understand that quite a few companies have taken this approach such as Facebook etc. What is interesting is that APIs do not have to be only tied to external connections (messaging across organizations), but some large organizations are executing on effective API strategy within the company firewall. I truly think that the massive “one-fits-all” era is gone and the new era will be more about how you become part of your own ecosystem.

What we are seeing when working with large ISVs is the trend to not try to replace the old legacy solution, but to simulate a start-up by creating a MVP (Minimal Viable Product) that can meet the requirements of “good enough” for the end users. I think we have really come to the end of an era where more functionality is better, people do not have time to learn and re-learn things that should be self-explanatory. I am very excited about this MVP approach and will be writing more about this in my upcoming posts. I think this gives a new opportunity for legacy vendors to be competing towards new market entrants than every before.

I am excited about the potential with software, software apps and the cloud. I have been in the business for more than 20 years (hard to admit) and I feel like a young boy with the opportunities at hand. I like to challenge my brain (and keep myself relevant) by developing solutions and last weekend I spent customizing our internal Dynamics CRM 2011 Online instance to include the ability to collect information of TELLUS Academy students and also how to integrate all of this with our SharePoint 2013 Online instance. All of these are of course cloud-enabled and can be used from anywhere, anytime and independent of device. I set the objective in 2005 when I founded TELLUS to NOT have any servers that everything had to be surfaced from the cloud. Think back to 2005 and you will realize that there were not that many native cloud applications at the time.

If you are in the software business, you should look at the opportunities around apps and how you can build something exciting using the cloud. Unfortunately many organizations tend to think that creating an app has only to do with smart phones, but there is much more into apps than that. The app is just the “window to a service” that lives in the cloud and the user gets the benefit of this from many perspective such as scalability. I has been fun to see many organizations going into this direction with Windows Azure as backbone for the cloud services and Windows apps as the foundation. Windows Azure supports other mobile technologies such as Android and iOS as well.

 

Will your web-site work with different devices?

It surprises me how few software vendors have realized to change their web-site to work with any type of mobile or tablet device. Almost a year-and-a-half ago I made a decision to make things simple and base my web-sites on technology whereby I do not have to think about different devices, the web-site technology will take care of it and I can focus on content.

During the history of our company, we have had many attempts by having external designers doing the web for us and we ended up having an everlasting fight to keep our web-site compatible not only with different browsers, but also different devices. Every time we needed to change something on the site, it was a major hassle and it seemed like having a house or cards that would collapse as soon as anything was touched. It was time to move on and change the approach. I bit the bullet and decided to make a chance and  research what would be the best platform to base our  consulting company and our educational portal on. I looked at many different factors such as richness of component ecosystem, reviews from industry analysts of pros and cons of each CMS and also how our web-site would be integrated to our Microsoft Dynamics CRM 2011 Online that has become the heart of our daily lead management.

I ended up with WordPress as the foundation and a big plus was also that Microsoft supports WordPress on Windows Azure platform so it became and opportunity for me to learn Windows Azure Internet Web Sites technology as well. We had invested quite a lot of time and effort into DNN (DotNetNuke) in the past, but I felt that WordPress gave us the simplicity what I was looking for and the huge ecosystem of software plugins and themes made it as an easy selection. There was absolutely nothing wrong with DNN, but I just felt that WordPress was the right choice for us at this time of our company evolution and that is why I ended up changing horse.

I listed all of the needed functional elements that our site would have to support and I spent time looking for the right theme that would support our multi-device and browser requirement. Once those had been selected, the rest was just execution. All of our sites have commercial skins that are updated by the designers to include the latest and greatest features of the platform and the WordPress can be managed from my Lumia Nokia device using an app that support WordPress backend.

In the end, what I ended up is having following things when moving to our new web-site technology:

  • Simple and well-known CMS technology (WordPress) with thousands of commercial themes and plugins
  • Support for any type of device  either via an app or via native browser
  • Scalable backend server technology by using Windows Azure
  • Simple and fun to use CMS solution that just “make sense”
  • Lots of third-party integration solutions that can be applied to our web-site
  • Etc.

My new mantra “keep it simple” has really worked in our new strategy and I will be writing more about our modules that we are using to run our business in later posts.

The App Economy – How should we view app monetization?

The blogosphere is all about apps and how different ecosystems compete for the eyeballs of these and the money of course. You might still remember the the news when a far app pulled as much as $10,000/day in revenue but since then there is tens of similar applications on the marketplace. This started a trend where people left their well-paid jobs to chase their dream of creating apps and living a life without pressures. The growth of app economy is one of the most promising trends, but people/organizations that want to make real money of it, need to include some risk management into it as well. The app industry has become similar to film industry where relatively few people make money and the ones that make, are hugely successful like Angry Birds phenomenon from Finland.

One might of course ask oneself is whether this is a shift in our society and how work is performed. according to Erik Brynjolfsson (director of the M.I.T. Center of digital business), “technology is always destroying jobs and always creating jobs, but in recent years the destruction has been happening faster than the creation”. There is no question that technology is creating new jobs and apps can be part of this opportunity as can be seen in many of the reports that have studied this trend towards “app economy”.

What I have not seen many discussions around is how the app economy is linked with the enterprise software business. I have researched around this and identified the “dimensions” that are typically linked to the app business, but not that much is said how established software vendors should view this space and how these vendors can make a entry to the app space in a way that makes sense and where there is also a sustainable economical model.

So, the question that we should ask ourselves is how much of the app business is truly geared towards the consumer business and how much of this will gradually move into enterprise business? Should software vendors keep the app business in their plans when building enterprise solutions specifically using the cloud? If they should keep this in mind, what kind of pricing should the ISV use? Maybe free as the real money comes from the enterprise solution and not the app that accesses it? As you can see, it is not that clear and my own experience when working with both small and large enterprises, the app business hardly ever comes up in discussions. I am convinced that this will change and it will change very quickly. One of the drivers will be Windows 8 and Windows Phone 8 developers that will create solutions that will be based on app technology and not on traditional desktop app architectural model even if these will be able to run in Windows 8 Pro environment.

Another valid question that we need to ask ourselves is whether app economy should be see purely from mobile app development perspective or should we view it from a perspective where the device is just the means to get to what you want and the backend (typically the cloud) is the one that provides the services and brokers the interaction between different services. Shouldn’t we in fact be talking about services economy instead where organizations build apps to consume and combine information from different sources using different SOA interfaces that organizations/developers have exposed to the world. Isn’t this what we have always dreamt about?

NokiaExpressI downloaded today a Windows Phone 8 app (Nokia Xpress) to my shiny Nokia Lumia 920 and this app really demonstrates where things are going. After having installed the app, it asked me whether it can use location information (which most apps want to use), but what really made me to think about the future of apps is that developers really have to think “outside the box” on when developing apps. The thing with this Nokia Xpress app is that it enables users to store and read articles on your phone (locally) so when you travel, you do not have to use expensive data roaming. I know.. there are many of these apps from before, but what this app has specifically thought of is to really monitory and minimize data usage and provide a combination of technology such as Microsoft SkyDrive technology to store videos and images without having to use the data plan. Why is this relevant to me? Just this week, my son’s data plan was going over the limit and I found out that it was all about video streaming and 2 gig data plan does not cope well with this.

The topic of “app economy” is very interesting to me as researcher, but also as practitioner. A recent paper written by Dr. Michael Mandel and Judith Scherer (commission by CTIA (The Wireless Association) and Application Developers Alliance provides an interesting view on the app economy. According to Mandel, the entire “App Economy” was coming to use in early 2009 and was popularized by a cover story run by BusinessWeek in November 2009.

The way that Dr. Michael Mandel describes App Economy in his February 2012 report resonates well with what I have educated my customers in respect to ecosystems:

“ App Economy is a collection of interlocking innovative ecosystems”. Each ecosystem consists of a core company, which creates and maintains a platform and an app marketplace, plus a small and large companies that produce apps and/or mobile devices  for that platform. Businesses can belong to multiple ecosystems and usually do”.

There is no question in my mind that this topic is relevant to anybody that works in the software industry and it is fascinating to see how this evolves with time and what kind of new companies will rise to take advantage of this.

If you work in the Microsoft ecosystem, I highly encourage you to read the article “Microsoft’s cloud vision: Why Azure is the linchpin of the firm’s new devices and services strategy”. Another great article from Information-Management.com that predicts Enterprise Apps to go mobile big time and that money apps will move to the cloud. The article lists quite a few things that are very interesting and I encourage you to read that article as well.

Stay tuned for more, there will be more to come on my research on different topics and this app economy being one of them!