Distilling market noise into market sense

VisionMobile is the leading research company in the app economy. Our Developer Economics research program tracks developer experiences across platforms, revenues, apps, tools, APIs, segments and regions, via the largest, most global developer surveys.

Just out: Developer Megatrends H1 2015

Software developers are a driving force in every industry and a source of competitive advantage. They are the kingmakers of modern business. In our 50+ page Developer Megatrends H1 2015 report (download it here or see the SlideShare presentation), we highlight 4 key developer trends for 2015.

Every day the evidence is mounting: software developers are a driving force in every industry and a source of competitive advantage. They are the kingmakers of modern business.

For mobile devices, there is no doubt. 1.5 million apps on iOS and Android each have propelled us into a new era of mobile computing and given rise to whole industries that weren’t even possible before. Look no further than the havoc that Uber is wreaking in the transportation industry. Developers are not finished with mobile, either. Every year, 800,000 new mobile developers join the pack. That’s about the population of South Dakota, Macau or Cyprus, every year.

Developers are invading more and more industries and verticals. Our Q1 2015 Developer Economics survey showed that 53% of mobile developers are already involved in the Internet of Things, with many more to come. Our latest estimates put the amount of IoT developers over 4 million individuals.

Developers are conquering the wrist, with 3,500+ Apple Watch apps and 2,300+ Android Wear apps. They’re conquering the car. Android Auto and Apple Carplay will be available on dozens of car models this year. 250+ OBD apps provide aftermarket solutions for car data, with growing support from big players in telecom and insurance. Developers are conquering the home, taking advantage of new technologies and platforms like Samsung SmartThings, Apple HomeKit, Google Weave, Eclipse Smart Home or dozens of device APIs. Developers are even conquering the sky. Major drone players like DJI (from Phantom fame), 3D Robotics (dronekit.io) or Airware are providing SDKs for drone apps, helping developers to put drones to use in industry, agriculture, construction or mining. Cities, healthcare, clothing, factories, … – They’ll all fall to the wave of innovation made by developers.

When we say developers, we don’t just mean hobbyists tinkerers. Developers matter a great deal to businesses. From telecom to fashion, from logistics to lighting, today’s competitive battles are won and lost by attracting developers. To cite just one example, Salesforce took the #1 spot in CRM systems from Oracle, in large part due to its 1.4M strong developer ecosystem. Every modern company must master developer ecosystem skills if it is to thrive in the information age.

4 key developer trends in 2015

In our 50+ page Developer Megatrends H1 2015 report, we highlight 4 key developer trends for 2015.

Developers escape from the app store. Revenue from app store sales or in-app advertising grew by 70% in one year, according to IDC and App Annie. Great news! Or is it? The truth is that the app store alone cannot sustain the mobile developer population. 60%+ of developers are under the app poverty line and only 1 in 9 is in the safe zone. Most money in the app economy is not made from the app store, but from app-driven e-commerce. Selling offline goods and services via apps represents 71% of the app economy in 2015 – and it’s earned by only 9% of developers! Whether using apps as a channel (like Amazon), building a mobile-first business (like Uber) or using apps as a platform (like WeChat), e-commerce is winning app revenue model and will remain so for the foreseeable future.

Developers escape from consumer markets. There is another way to dodge the poverty trap: target enterprises. Only 20% of mobile developers target enterprises, but 46% of them makes over $10K per month, versus 19% for consumer-oriented developers. Making the jump to enterprise might be easier than it seems. There is substantial overlap in what consumer and enterprise app developers are working on. Many apps can be simply repositioned or repurposed to attract an enterprise audience rather than consumers. We see a similar pattern among Internet of Things developers. Winning app and IoT developers will repurpose consumer technology and business models to solve the most important enterprise problems, and dodge the poverty trap by doing so.

Apps escape from screens. The app paradigm of bite-sized software is replicated outside of smartphones: it can be found on the watch, desktop, car, TV, browser, and in the home. The nature of apps is changing too. From yesterday’s traditional app like Angry Birds (where the value is delivered by the app itself), we’ve moved to the companion app. In Honeywell’s thermostat-controlling Lyric app, the value is in the device, and the app is just the remote control. The value in tomorrow’s apps will come from making sense of data. Apps like Apple Health process triggers and signals across devices, sensors and APIs. As a consequence, data developers and data platforms will soon be king.

Platforms escape from mobile. What’s the future of mobile platforms, given the stalemate in platform wars and the evolution to data-centric apps that moves the focus away from mobile OS? Mobile ecosystems like Android and iOS move to the Internet of Things in force, fully leveraging their developer and user bases to gain traction fast across all major IoT verticals. Others like e-commerce players are following in their footsteps, attracting devs with distribution capability and engaged users. Here’s the billion dollar question then: will the network effects from mobile carry over to IoT? Will the mobile platform duopoly be sustained in IoT? In the future, IoT device selection by consumers and enterprises will be determined by “will it work with my existing services and devices”. We predicted this as early as 2010. In the 2012 edition of the Megatrends report, we talked about the evolving meaning of convergence. From converged networks, to converged devices, to experience roaming. That prediction is now playing out in full.

Download the full Developer Megatrends H1 2015 here.

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