Proliferation of Mobile Devices = Opportunity for Apps & Developers
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Proliferation of Mobile Devices = Opportunity for Apps & Developers

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These slides are from a webcast originally recorded on 8/4/10. During this webcast, Eric Klein, Senior Analyst, Mobile & Wireless Practice at VDC Research, presents data from VDC’s annual Mobile......

These slides are from a webcast originally recorded on 8/4/10. During this webcast, Eric Klein, Senior Analyst, Mobile & Wireless Practice at VDC Research, presents data from VDC’s annual Mobile Developer survey, as well as the findings from vendor and end-user interviews. Specifically, he provides insights into: The size of the mobile applications market, and how quickly it is expected to grow; The primary challenges enterprises face when adopting mobile applications; How traditional enterprise software vendors are transitioning their products to mobile platforms; The ramifications of the recent acquisitions in the mobility space; How the shifting/evolving mobile landscape will create opportunities; How companies plan to acquire, deploy and support mobile applications; and The key technical trends companies should be aware of when adopting mobile technologies.

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  • 1. VDC Research Webcast Proliferation of Mobile Devices = Opportunity for Apps & Developers pp y pp p Mobile and Wireless Practice Eric Klein – Senior Analyst David Krebs – Director
  • 2. Recording Available These slides are from a webcast presented on 08/04/10. p A full audio recording is available for download at: www.vdcresearch.com/market_research/mobile_wireless/freeresearch.aspx# 1 –  2010 VDC Research Group, Inc. Mobile and Wireless Practice
  • 3. VDC Research Group Additional complimentary insights and marketing data on the mobile and wireless market available at: www.vdcresearch.com 2 –  2010 VDC Research Group, Inc. Mobile and Wireless Practice
  • 4. Today’s Mobile and Wireless Practice Speakers: Eric Klein – Senior Analyst Eric is a market research and consulting professional specializing in the design, analysis, and delivery of project-based research. Over the past 15 years, Eric has worked with a wide array of firms across a number of industries, leading quantitative and qualitative research in areas such as innovation in enterprise software, supply chain risk management, manufacturing operations/automation, and IT spending research. Eric has worked in a variety of market research and management roles, providing market data and competitive intelligence to Fortune 500 firms. His previous employers include: AMR Research, The Yankee Group, and Affiliated Computer Services (ACS). Eric holds a Bachelor of Science in Finance from Boston University. David Krebs – Director David has more than ten years experience covering the markets for enterprise and government mobility solutions, wireless data communication technologies and automatic data-capture research and consulting. David focuses on identifying the key drivers and enablers in the adoption of mobile and wireless solutions among mobile workers in the extended enterprise. David’s consulting and strategic advisory experience is far reaching and includes technology and market opportunity assessments, technology penetration and adoption enablers, partner profiling and development, new product t it t t h l t ti d d ti bl t fili dd l t d t development and M&A due diligence support. David has extensive primary market research management and execution experience to support market sizing and forecasting, total cost of ownership (TCO), comparative product performance evaluation, competitive benchmarking and end user requirements analysis. David is a graduate of Boston University (BSBA). 3 –  2010 VDC Research Group, Inc. Mobile and Wireless Practice
  • 5. Today’s Agenda Market overview: the state of enterprise application mobilization “Playing in traffic” – How device expansion increases complexity Forces Driving Enterprise Mobility The rugged market segment is different Conclusions: What lies ahead 4 –  2010 VDC Research Group, Inc. Mobile and Wireless Practice
  • 6. Research Methodology • The following programs constituted the core of Target Communities Sample Size our primary data collection efforts. i d t ll ti ff t • Structured interviews were conducted with Presidents, VPs of Marketing, Mobile Solution Providers and Software Vendors >30 Business Development Managers and Senior Product Managers at the following organizations:  Mobile Computer Hardware Suppliers Mobile Software Developers 175  Mobile Software Vendors  Enterprise Software Vendors  Mobile System Integrators Enterprise Mobility End Users and Evaluators >550 • Web survey fielded among mobile software developers. • Web survey fielded among enterprise mobility end users and evaluators across a variety of sectors. 5 –  2010 VDC Research Group, Inc. Mobile and Wireless Practice
  • 7. Research Methodology Mobile ft M bil software research scope h Vertical Markets ions ps usiness App Enterprise Extensi Mobile ecurity Software Handheld/ PDA DM) Solutions Management (MD Line of Bu Mobile Se Mob Device Smartphone Notebook / Convertible Mobile Computer bile Form Factors F F t Slate T bl t Sl t Tablet Vehicle Mounted UMPC 6 –  2010 VDC Research Group, Inc. Mobile and Wireless Practice
  • 8. Global Mobile Device Forecast - 57M units by 2014 Notebook, Rugged, and UMPC growth continue – S N t b k R d d th ti Smartphones show strongest uptake t h h t t t k • We project that the rugged device segment Device Allocation: (including both small & large FF s) will FF’s) Global Mobile Device Unit Shipments decline in terms of allocation, but remains as a growth market with a 13.8% CAGR over the 100% next 5 years • Smartphone adoption in the enterprise p p p 80% continues to climb, and will reach nearly 33M 48% units by 2014 58% • However, the fastest growing segment of 60% Smartphone Smartphones used in the enterprise are individual li bl i di id l liable (IL) devices d i Notebook 40% 35% Rugged Note: This data strictly represents mobile devices 27% that are deployed by enterprise organizations to 20% Slate / Tablet support enterprise mobility applications VDC applications. defines enterprise mobility applications as solutions 14% 11% Netbook that support real time distributed transaction processing. 0% *UMPC market < 1% 2010 2014 Units: 27.7M 56.9M 7 –  2010 VDC Research Group, Inc. Mobile and Wireless Practice
  • 9. What’s Driving the Mobilization of Enterprise Apps? • Companies have made sizeable investments in p their IT infrastructure and enterprise applications – the desire to extract value from these investments is occurring and will continue to • Decreasing prices points, advances in mobile technologies, technologies and delivery platforms opens the door for many more enterprises to adopt or expand their usage of mobile enterprise applications • Maturation in the mobility segment is giving specialists tremendous partnership i li t t d t hi opportunities with ISVs and SIs – effective partnering can become a major differentiator • Developer communities are flourishing – the job market is flush with mobile development positions • Mobility platform vendors are offering powerful tools for rapid application development – across all most major mobile OS platforms • Every worker IT supports is becoming more mobile 8 –  2010 VDC Research Group, Inc. Mobile and Wireless Practice
  • 10. Important Criteria When Evaluating Mobile Apps Integration and Customization capabilities are t of mind when evaluating mobile apps I t ti d C t i ti biliti top f i d h l ti bil Most important selection criteria p when evaluating mobile applications*: • Companies evaluating mobile technologies Overall cost 62% and applications are most concern with cost User friendly 49% – this is no at all a surprise considering the current economic climate. Cost ranked 3rd d Integration w/ existing enterprise apps 43% in our end-user study from 2009 Ability to customize 38% • Running lean is a given for many companies Ability to scale functionality 28% in this economy – to succeed, vendors must be able to demonstrate how their mobile Pre/Post implementation support 25% solutions will lead to rapid ROI Hosted options 21% • These evaluation criteria vary widely by Ability to scale users 21% industry and company size – larger companies are more concerned with hosting Partner recommendation 7% options and the ability to scale users Other 4% Vertical market design 3% *Multiple response question 9 –  2010 VDC Research Group, Inc. Mobile and Wireless Practice
  • 11. Tangible Benefits From Mobile Deployments: Considering your organizations most recent mobile deployment, what level of benefit has your organization achieved against the following areas? Increased mobile worker productivity +31% Improve real-time decision making +27% Improved inventory accuracy +27% Improved customer loyalty and repeat business +25% Reduced asset failures +23% End-user interview: large global chemical manufacturer: One chemical manufacturer we interviewed implemented a $200K mobile solution that included rugged handhelds supporting mobile applications to streamline operations management and improve decision support capabilities and enhance the workflow associated with their operator rounds. Over a short time frame they have expanded from a pilot at 1 facility to rolling out this solution to all 20 of their plants. The company achieved hard dollar savings of $1.2M in the first year the solution was implemented. 10 –  2010 VDC Research Group, Inc. Mobile and Wireless Practice
  • 12. Today’s Agenda Market overview: the state of enterprise application mobilization “Playing in traffic” – How device expansion increases complexity Forces Driving Enterprise Mobility The rugged market segment is different Conclusions: What lies ahead 11 –  2010 VDC Research Group, Inc. Mobile and Wireless Practice
  • 13. Fragmentation, and “Learning to Play in Traffic” Pace of innovation, and d i proliferation creates challenges and opportunities P fi ti d device lif ti t h ll d t iti 12 –  2010 VDC Research Group, Inc. Mobile and Wireless Practice
  • 14. Challenges Facing Mobile SW Developers Specification changes and “ S ifi ti h d “scope creep” are a significant challenge f mobile SW developers ” i ifi t h ll for bil d l Most challenging issues addressed g g during the development lifecycle*: Changes in specifications/Scope creep 50% • Software developers have to deal with a variety of challenges during the development lifecycle – issues with Incomplete specifications 39% specifications seems to rise to the top Application complexity 38% • Specifications changes almost also result in delays and missed deadlines Lack of qualified developers 28% • M More powerful devices and form factors, f ld i df f t along with OS and API enhancements are also adding to the challenges mobile Lack of skilled testing personnel 11% developers face as they are increasingly being asked to development more complex g p p Poor development tools 11% applications Lack of vendor support 5% Other 4% *Multiple response question 13 –  2010 VDC Research Group, Inc. Mobile and Wireless Practice
  • 15. Challenges Facing Mobile SW Developers – Cont. Developers challenged with updating apps t f D l h ll d ith d ti to fragmented OS l d t d landscape Challenges with primary application g p y pp channel*: Application updates are 39% • Mobile device / OS fragmentation makes it difficult to push challenging for developers to seamlessly update their applications Pricing options are inflexible 21% • Issues associated with pricing options and delays in the application acceptance / Submission process is too submission process remain as challenges, 21% long but are secondary Review process seems 18% unfair/biased Certification is C tifi ti i expensive or i 14% lengthy Revenue sharing 7% *Multiple response question 14 –  2010 VDC Research Group, Inc. Mobile and Wireless Practice
  • 16. Developers Not Just Reliant on App Store Model Developers must use a multi-channel approach t maximize th i profits D l t lti h l h to i i their fit Main channels for SW developers p to sell their applications*: • Developers are best served by adopting a App store 50% multi-channel approached to market and sell their applications pp Direct download via our own site 41% • Developers are using their own web site to drive downloads and to market their Via customer who is commissioning applications 37% the application • Enterprises adopting mobile applications Operator/Carrier portal 26% will ultimately begin controlling application updates – this functionality will begin to be incorporated into mobility platforms as well 3rd party aggregator or portal 24% as MDM vendors products On-device pre-loading via handset 17% manufacturer On-device pre-loading via operator 4% *Multiple response question 15 –  2010 VDC Research Group, Inc. Mobile and Wireless Practice
  • 17. Today’s Agenda Market overview: the state of enterprise application mobilization “Playing in traffic” – How device expansion increases complexity Forces Driving Enterprise Mobility The rugged market segment is different Conclusions: What lies ahead 16 –  2010 VDC Research Group, Inc. Mobile and Wireless Practice
  • 18. Forces Driving Enterprise Mobility 17 –  2010 VDC Research Group, Inc. Mobile and Wireless Practice
  • 19. Smartphone Application Support: Moving Beyond Wireless Email & PIMS Wireless Email 71% 13% 10% 6% Personalized contacts 64% 9% 10% 16% 1% Content / employee portal 34% 10% 25% 29% 2% SMS alerts 33% 6% 16% 42% 2% IM 29% 8% 19% 44% Inventory mgmt 28% 5% 16% 48% 3% Field service mgmt 24% 6% 20% 44% 5% Sales force mgmt 22% 4% 21% 47% 6% Customer interation mgmt 21% 8% 19% 50% 2% Logistics mgmt 18% 5% 20% 53% 4% Fully deployed Rolling out or partial deployment Evaluating or piloting No plans Don t Don't know 18 –  2010 VDC Research Group, Inc. Mobile & Wireless Practice
  • 20. “Easy as Facebook” “Sesame Street Simple” KISS is a very relevant acronym when it come to mobile applications ... i l t h t bil li ti Functional Role Functionality • Must be intuitive and stress ease of use • Function role expansion – apps for roles • Must improve/streamline workflow • Increasingly distributed, decentralized, and mobile staffs • Backend/ integration/ customization capability bilit Security + Manageability • Must demonstrate ability to reduce corporate liability and risk • Provide strong MDM capabilities – best accomplished by partnering • Must have robust mgmt capability, offer both BTF and web based solutions moving forward Usability • Must be designed for varying conditions • Must be able to accommodate fragmented devices / OS minefield 19 –  2010 VDC Research Group, Inc. Mobile and Wireless Practice
  • 21. Today’s Agenda Market overview: the state of enterprise application mobilization “Playing in traffic” – How device expansion increases complexity Forces Driving Enterprise Mobility The rugged market segment is different Conclusions: What lies ahead 20 –  2010 VDC Research Group, Inc. Mobile and Wireless Practice
  • 22. Why the Windows is Still Very Relevant ... • Microsoft’s OS is dominant in the rugged handheld space, with a sizeable gg p installed base on several platforms such as embedded CE, and various Window Mobile software releases (80%+ market share).  Microsoft recent Windows Embedded Handheld release, and its continued support and cooperation with dominant OEMs in the rugged space such as Motorola, Intermec, and Honeywell shows that the company acknowledges that the rugged space is evolving and that it has no intentions of exiting  An updated Windows Embedded Handheld platform will be released in the second half of calendar year 2011.  This expanded platform will build on Windows Mobile 6.5’s manageability and security features by incorporating additional technologies from Windows Embedded Compact 7, including updated kernel and memory models browser and input methods such as multitouch models, browser, methods, multitouch.  Additionally, the platform will feature the Silverlight for Windows Embedded user interface framework to help OEMs, developers and designers implement immersive user interfaces on enterprise handheld devices.  Microsoft will also include a migration path for existing applications to a new application platform based on Microsoft Silverlight and Microsoft XNA with Visual Studio 2010.  The majority of rugged mobile applications have been developed with Microsoft tools – the challenge for Microsoft now will be to keep developers interested in continuing to develop applications suitable for the rugged mobile market.  The challenge for OEMs will be bringing solutions to the market that leverage the latest OS innovations while maintaining consistency with its (conservative) clients clients. 21 –  2010 VDC Research Group, Inc. Mobile and Wireless Practice
  • 23. Mobile Applications Deployment Trends: Enterprise wireless E M il remains the most widely d l E t i i l E-Mail i th t id l deployed – service lif d i lifecycle management apps gaining l t i i Currently deployed mobile applications (rank order): Currently Deployed Mobile Applications (rank order) Manufacturing Government Life Sciences /Health Care Wireless Email Wireless Email Wireless Email Inventory/Warehouse Management Command & Control / Communications Charts Field Sales (Sales Force Automation) Workforce Management E-prescribing Shipping & Receiving Maintenance / Repair / Diagnostics Remote Physician Information Access Asset Management Asset Management Charge Capture 22 –  2010 VDC Research Group, Inc. Mobile and Wireless Practice
  • 24. Today’s Agenda Market overview: the state of enterprise application mobilization “Playing in traffic” – How device expansion increases complexity Forces Driving Enterprise Mobility The rugged market segment is different Conclusions: What lies ahead 23 –  2010 VDC Research Group, Inc. Mobile and Wireless Practice
  • 25. Conclusions A recent Report from PricewaterhouseCoopers LLP (PwC) and the National Venture Capital Association (NVCA) showed that the software industry had the most venture funding deals completed in Q2 with 229 rounds (amounting to $1B), representing a jump of 43% from Q1. In terms of dollars invested, the software sector was in third place, trailing only biotechnology and energy market segments. bi t h l d k t t 24 –  2010 VDC Research Group, Inc. Mobile and Wireless Practice
  • 26. Conclusions – Where do we go from here? Today: • Every worker supported by IT is becoming more mobile y pp y g • Securing employee-owned devices is imperative for mobile application expansion in the enterprise • The rugged market is evolving with new devices continue to emerge • Everyone is “wooing” mobile application developers Next 12-18 Months: • Portions of traditional enterprise applications will continue to be mobilized • MicroApplications will makes gains in the enterprise • Tablet segment gains traction in the enterprise with screen real-estate advantage • Platform-independent application development tools continue become more viable and give i t Pl tf i d d t li ti d l tt l ti b i bl d i internal l in-house development more flexibility while “platform battles” continue • B2C enablers will flourish as the mobile web continues to gain in importance as a channel Long Term View: • Device proliferation creates need for better synch. capability for multiple mobile devices • More M&A activity from enterprise ISVs • Channel conflict increases challenging OEMs , ISV, and carriers • HTML 5?! 25 –  2010 VDC Research Group, Inc. Mobile and Wireless Practice
  • 27. Q&A Session Thank You for Attending this VDC Webcast. g For more information about the Mobile and Wireless Practice, Please Contact: Gerrald Smith – Senior Account Executive gsmith@vdcresearch.com | 508.653.9000 x113 David Krebs – Practice Director davidk@vdcresearch.com | 508.653.9000 x136 Eric Klein – Senior Analyst eklein@vdcresearch.com | 508.653.9000 x141 26 –  2010 VDC Research Group, Inc. Mobile and Wireless Practice