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Preliminary findings: ICT Developers Survey
David Card, VP Gigaom Research
13 November 2013
Agenda
• What we’re trying to accomplish
– Modeling the Eurapp economy aftermarket
– Understanding successes and challenge...
European app ecosystem
Aftermarket
New Platforms
New Platforms
App Developer Types
Originator
Environment

Social

OS supp...
Smartphone crossover coming fast
Smartphone Shipments, 2012-2017
250

(millions)

200
150
100
50
0
2012

2013

North Ameri...
Facebook adoption passing 50% in Europe
Facebook Subscriber Growth
250

(millions)

200
150
100
50
0
Mar-11

Jun-11

Europ...
ICT developer survey background
•
•
•
•

Over 500 responses
Mix across home countries: UK, Germany, France, Italy, Spain
M...
Apps for customers more than employees, supply chain

We develop or support custom mobile and social
apps…
For customers

...
Half of in-house developers also outsource
Mobile and social apps approach
Develop in-house

63%

Outsource to third parti...
Apps to complement products, aid marketing/sales
Commercial objectives for mobile and social
apps
To improve customer expe...
High satisfaction rates for key app objectives
Satisfaction with apps’ commercial objectives
To improve customer experienc...
Seeking EU first; US, E. Europe, Nordic regions on radar
Other target markets
UK
France
Germany
Spain
Italy
USA, N. Americ...
One third target alternative phones, social nets
Supported apps environments
Android phone

72%

Android tablet

63%

iPho...
Plenty of new apps, but growth rate flat
Number of apps developed, planned
5%

One

24%

2-3

21%

4-6

24%

7-15
16-30

1...
Nearly 30% of companies hired 10+ developers last year

Number of app developers added last year
1-2

23%

3-5

15%

6-10
...
Good growth: one fourth expect to grow over 5%
Expected growth in number of app developers
next year
1-2%
3-5%
6-7%
Testin...
Nearly half 1:1 ratio of support staff to developers
Number of app developers, support staff
1-2

3-5
6-10

11-30
31-50
51...
Hiring growth even better than for developers
Expected growth in number of app support
personnel next year
1-2%

15%

3-5%...
Interviews: Challenges for the Eurapp economy
Environmental
•

•
•
•

Platform concentration: US
companies dominate
3+ yea...
Fragmented markets, regulation; but no dominant bottleneck

Top 2 European market challenges for apps
App platforms domina...
In-house developers frustrated by platform divergence

Top 2 tech challenges for apps
38%

Lack of cross-platform compatib...
Talent bottlenecks: salaries, education, business skills

Top 2 resource challenges for European apps
40%

Harder to attra...
Key takeaways
• Platform proliferation will take care of itself
• ICT developers highly satisfied with app commercial
effe...
Next steps
• Mapping survey input to forecast model
– Revenue
– Jobs
– New job creation

• Detailed job profiling
• Compar...
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"Preliminary Findings from the ICT Developers Survey" by David Card, Vice President, Gigaom Research

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Rebooting the EU App Economy / Fraunhofer HHI, Berlin, Germany / 13th November 2013

David Card, Vice President, Gigaom Research

"Preliminary Findings from the ICT Developers Survey"

David Card is Vice President for Research at Gigaom Research. His expertise is as an industry analyst (and manager) covering the intersection of media, technology, and consumer behavior. His specialities include customer segmentation, competitive analysis, go-to-market strategies, market forecasting. Previously, David has held lead roles in Jupiter Research, International Data Corporation and Electronic Business magazine.

Published in: Technology, Business
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Transcript of ""Preliminary Findings from the ICT Developers Survey" by David Card, Vice President, Gigaom Research"

  1. 1. Preliminary findings: ICT Developers Survey David Card, VP Gigaom Research 13 November 2013
  2. 2. Agenda • What we’re trying to accomplish – Modeling the Eurapp economy aftermarket – Understanding successes and challenges – Two surveys as inputs • • • • Preliminary findings from ICT developers survey Rebooting the EU economy with apps? App development challenges Next steps
  3. 3. European app ecosystem Aftermarket New Platforms New Platforms App Developer Types Originator Environment Social OS suppliers API suppliers Devices ISVs Mobile IT Developers Smart TV Cottage Industry, Hobbyists Revenue/Monetization • Consumer spending • Business spending • Advertising • In-app spending (virtual goods) Jobs created App Stores, 3rd party app-discovery
  4. 4. Smartphone crossover coming fast Smartphone Shipments, 2012-2017 250 (millions) 200 150 100 50 0 2012 2013 North America 2014 2015 Western Europe 2016 2017 Japan Source: Smith's Point Analytics/Gigaom Research, 2013
  5. 5. Facebook adoption passing 50% in Europe Facebook Subscriber Growth 250 (millions) 200 150 100 50 0 Mar-11 Jun-11 Europe Seo 2011 Asia Dec-11 Mar-12 North America Source: Internet World Stats, 2012
  6. 6. ICT developer survey background • • • • Over 500 responses Mix across home countries: UK, Germany, France, Italy, Spain Mix of company sizes: 31% > 500 employees, 20% > 1,000 Mix of industries, though approximately 20% in technology; 13-14% of biggest companies in financial services
  7. 7. Apps for customers more than employees, supply chain We develop or support custom mobile and social apps… For customers 67% For own employees 56% For partners, distributors 38% Main business is commercial apps 18% 0% 20% 40% 60% 80% 100% Source: preliminary Gigaom Research EU ICT developers survey, 3Q 2013 N= 525
  8. 8. Half of in-house developers also outsource Mobile and social apps approach Develop in-house 63% Outsource to third parties 53% Integrate with commercial apps from consumer apps stores 39% Integrate with commercial apps from business apps stores 19% 0% 20% 40% 60% 80% 100% Source: preliminary Gigaom Research EU ICT developers survey, 3Q 2013 N= 525
  9. 9. Apps to complement products, aid marketing/sales Commercial objectives for mobile and social apps To improve customer experience… 58% Marketing for products, services 50% To sell products, services 46% Reduce customer service costs 43% Charge for apps None of above, just internal use 24% 2% 0% 20% 40% 60% 80% 100% Source: preliminary Gigaom Research EU ICT developers survey, 3Q 2013 N= 524
  10. 10. High satisfaction rates for key app objectives Satisfaction with apps’ commercial objectives To improve customer experience of our products, services 40% 38% Marketing for products, services 39% 38% To sell products, services 37% Reduce customer service costs 38% Charge for apps 28% Internal use by employees 29% 32% 38% 0% Very satisfied 35% 20% 34% 40% 60% 80% 100% Somewhat satisfied Source: preliminary Gigaom Research EU ICT developers survey, 3Q 2013 N= 517
  11. 11. Seeking EU first; US, E. Europe, Nordic regions on radar Other target markets UK France Germany Spain Italy USA, N. America Eastern Europe Nordic China Japan Russia Asia-Pacific India, Southern Asia Africa 41% 41% 40% 36% 35% 26% 25% 22% 17% 13% 12% 12% 9% 9% 0% 20% 40% 60% 80% 100% Source: preliminary Gigaom Research EU ICT developers survey, 3Q 2013 N= 524
  12. 12. One third target alternative phones, social nets Supported apps environments Android phone 72% Android tablet 63% iPhone 71% iPad 61% Other phone 35% Other tablet 26% Social network 35% Smart TV 14% 0% 20% 40% 60% 80% 100% Source: preliminary Gigaom Research EU ICT developers survey, 3Q 2013 N= 522
  13. 13. Plenty of new apps, but growth rate flat Number of apps developed, planned 5% One 24% 2-3 21% 4-6 24% 7-15 16-30 12% More than 30 Next year Last year 12% 2% None 0% 20% 40% 60% 80% 100% Source: preliminary Gigaom Research EU ICT developers survey, 3Q 2013 N= 522
  14. 14. Nearly 30% of companies hired 10+ developers last year Number of app developers added last year 1-2 23% 3-5 15% 6-10 15% 11-30 12% 31-50 8% 51-100 4% 101-500 2% More than 500 2% None 19% 0% 20% 40% 60% 80% 100% Source: preliminary Gigaom Research EU ICT developers survey, 3Q 2013 N= 521
  15. 15. Good growth: one fourth expect to grow over 5% Expected growth in number of app developers next year 1-2% 3-5% 6-7% Testing, support Scripters, designers Engineers, coders 8-10% 11-15% More than 15% No growth 0% 20% 40% 60% 80% 100% Source: preliminary Gigaom Research EU ICT developers survey, 3Q 2013 N= 519
  16. 16. Nearly half 1:1 ratio of support staff to developers Number of app developers, support staff 1-2 3-5 6-10 11-30 31-50 51-100 101-500 More than 500 0% 20% 40% App developers 60% 80% 100% Support staff Source: preliminary Gigaom Research EU ICT developers survey, 3Q 2013 N= 522
  17. 17. Hiring growth even better than for developers Expected growth in number of app support personnel next year 1-2% 15% 3-5% 22% 6-7% 17% 8-10% 7% 11-15% 3% More than 15% 4% No growth 32% 0% 20% 40% 60% 80% 100% Source: preliminary Gigaom Research EU ICT developers survey, 3Q 2013 N= 517
  18. 18. Interviews: Challenges for the Eurapp economy Environmental • • • • Platform concentration: US companies dominate 3+ year lag in adoption Fragmented markets Conservative investors, entrepreneurs Technical • • • • • Cross-platform development Dev tools, open source Native language support tools Lagging 4G Data portability Business and Financial • • • • • • Immature ad market No standard ad measurement “currency” Unwillingness to pay for apps Low-priced apps Customer acquisition costs Access to capital Resources • • • Fewer developers Lower salaries Lack of business expertise at tech startups
  19. 19. Fragmented markets, regulation; but no dominant bottleneck Top 2 European market challenges for apps App platforms dominated by Apple, Google, Facebook, etc. 31% Multiple languages 30% Inconsistent regulation 28% Restrictive regulation 24% Lagging European tech adoption 19% Small European country markets 19% Multiple currencies 15% 0% 20% 40% 60% 80% 100% Source: preliminary Gigaom Research EU ICT developers survey, 3Q 2013 N= 517
  20. 20. In-house developers frustrated by platform divergence Top 2 tech challenges for apps 38% Lack of cross-platform compatibility 28% Lagging European 4G adoption Breadth, depth of API services 19% Adding social functionality 18% Dev tools 18% Difficulty in delivering mobile experience 18% Immaturity of open-source tech, community 16% 14% Data available via API 0% 20% 40% 60% 80% 100% Source: preliminary Gigaom Research EU ICT developers survey, 3Q 2013 N= 517
  21. 21. Talent bottlenecks: salaries, education, business skills Top 2 resource challenges for European apps 40% Harder to attract dev talent, low salaries Relatively less app dev education 33% Lack of business expertise at startups 32% Fewer SW companies to spin off developers 28% 24% Fewer developers 0% 20% 40% 60% 80% 100% Source: preliminary Gigaom Research EU ICT developers survey, 3Q 2013 N= 517
  22. 22. Key takeaways • Platform proliferation will take care of itself • ICT developers highly satisfied with app commercial effectiveness, investing more in staff • Half of in-house developers also outsource • Even more hiring growth in app support than development • Target markets mostly still in EU • Key challenges: talent competition, cross-platform development
  23. 23. Next steps • Mapping survey input to forecast model – Revenue – Jobs – New job creation • Detailed job profiling • Comparisons with independent developers’ survey, cottage industry • Take the survey http://eurapp.eu/independent-app-developer-survey
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