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Developer Megatrends H1 2015 2015 VisionMobile 1
DEVELOPER MEGATRENDS H1 2015
2015 VisionMobile.com May 2015
Developer Megatrends H1 2015 2015 VisionMobile
VISIONMOBILE: THE ANALYSTS OF THE DEVELOPER ECOSYSTEMVisionMobile is the leading market research and analysis company in the app developer economy. Our surveys
and SDK analytics uncover the latest trends across mobile, IoT, PC, and Cloud developers, and help our clients
decode the complex developer ecosystem landscape.
Developer Economics is the largest, most global app developer research and engagement program reaching up
to 10,000 developers in over 140 countries. Now in its 9th edition, the research program tracks developer
experiences across platforms, revenues, apps, tools, APIs, segments and regions. Our Developer Economics
research also covers IoT, with the latest survey capturing trends from 4,000+ IoT developers.
Primary research Thought-leading reports Developer data
Developer Megatrends H1 2015 2015 VisionMobile
TRUSTED BY THE LEADING BRANDS AND MEDIA clients who benefit from developer economics Leading media channels quoting our research
Developer Megatrends H1 2015 2015 VisionMobile
ABOUT THE AUTHOR
Stijn Schuermans Senior Business Analyst
Michael Vakulenko Strategy Director
Christina Voskoglou Director of Research and Operations
Stijn focuses on understanding how technology becomes value-creating innovation, how business models affect market dynamics, and the consequences of this for corporate strategy. He is the lead Internet of Things researcher in the VisionMobile team since 2012. Stijn holds an engineering master degree and an MBA. He has over 10 years experience as an engineer, product manager, strategist and business analyst. You can reach Stijn at: stijn@visionmobile.com @stijnschuermans
Michael has over 18 years experience in mobile and telecom starting from working on first experimental 3G systems in Qualcomm. Later on Michael was part of several startups developing products in the areas of wireless, enterprise networking and mobile apps. At VisionMobile Michael works at the cross section of business models, economics and technology where he leads strategy practice for software-centric business models in mobile, Internet of Things and Connected Car. You can reach Michael at: michael@visionmobile.com @mvakulenko
Christina leads the analyst team and oversees all VisionMobile data projects from methodology to analysis and insights generation. She is also behind VisionMobiles developer segmentation research, as well as the Developer Economics reports and DataBoard subscription services. Christina has more than 16 years of experience in statistical consulting, BI design and business forecasting. She holds an MSc in Statistics from the London School of Economics (LSE) and a BSc in Economics & Statistics from the University of Bath. You can reach Christina at: christina@visionmobile.com @ChristinaVoskog
Developer Megatrends H1 2015 2015 VisionMobile
IN THIS REPORT
5
Introduction Developers are kingmakers in every industry
Developers escape from the
app store
Developers escape consumer
markets
Apps escape from screens
Platform players escape from
mobile
Developer Megatrends H1 2015 2015 VisionMobile
DEVELOPERS ARE KINGMAKERS IN EVERY INDUSTRY6
Developer Megatrends H1 2015 2015 VisionMobile
DEVELOPERS HAVE CONQUERED THE PHONE WITH APPS
7 Source: VisionMobile estimates
Developer Megatrends H1 2015 2015 VisionMobile
THEYRE JOINED BY 800,000 NEW MOBILE DEVELOPERS PER YEAR
8
http://vmob.me/AF14
Source: App Economy Forecasts 2014-2017 | VisionMobile
Developer Megatrends H1 2015 2015 VisionMobile
http://vmob.me/IoT15
9
53% of mobile developers are already
involved in the Internet of Things
and many more to come
DEVELOPERS MOVE TO MORE AND MORE INDUSTRIES AND VERTICALS
Developer Megatrends H1 2015 2015 VisionMobile
DEVELOPERS ARE CONQUERING THE WRIST
10
Apple Watch
3,500+ apps
Android Wear
2,300+ apps
Pebble
1,400+ apps
Source: Apple, Pebble, Android Wear Center, VisionMobile estimates (Q1 2015)
Developer Megatrends H1 2015 2015 VisionMobile
DEVELOPERS ARE CONQUERING THE CAR
11
Aftermarket solutions for any car, 250+ OBD apps in Google Play,
growing support from big players
API available by invite only 40 new vehicle models in 2015
API publicly available (Nov 2014) Apps can be published on Google Play (Mar 2015)
First models in 2015
Developer Megatrends H1 2015 2015 VisionMobile
DEVELOPERS ARE CONQUERING THE HOME
12
There are a lot of things that were not going to be able to build. We want to work with developers who bring other great ideas in the mix. [] The iPhone was great - it had 5 apps on it when it shipped. Now it has a million apps on it. The opportunity in the home is going to be pretty close. Tony Fadell
ex-Apple, CEO Nest
https://www.youtube.com/watch?v=377oDvnrk5M&t=20m40s (edited for clarity)
a small selection of Smart Home platforms and APIs
Developer Megatrends H1 2015 2015 VisionMobile
DEVELOPERS ARE CONQUERING THE SKY
13
There are a lot of industrial use cases that DJI cant build the software for, but developers can come and create software for industrial companies. Developers are already using our SDK to build apps to help control drones for agriculture, construction, and mining. Michael Perry
DJI
http://techcrunch.com/2015/05/06/dji-drone-platform/
Android for drones
http://dronekit.io/
Raised $75M to build an industrial UAV developer platform (May 2015)
http://dev.dji.com/
An operating system for commercial drones
http://www.airware.com/developers
Developer Megatrends H1 2015 2015 VisionMobile
Developers are conquering cities healthcare clothing factories
well, everything really!
14
Developer Megatrends H1 2015 2015 VisionMobile
TODAYS COMPETITIVE BATTLES ARE WON AND LOST BY ATTRACTING DEVELOPERS
15
Salesforce 1.4M registered devs in 2013 took #1 spot from Oracle in CRM
Apple iOS | Google Android took #1 spot from Nokia and Blackberry in (smart)phones
Under Armour fashion brand uses
developers to engage communities of athletes
Microsoft Windows dominant OS in the 90s and 00s because of superior developer strategy
Developer Megatrends H1 2015 2015 VisionMobile
EVERY COMPANY SHOULD MASTER DEVELOPER ECOSYSTEM SKILLS
16
platform technology people
rules for interaction + +
developer ecosystem =
individuals & companies users & developers
API
cloud, APIs, apps, devices, OS,
app curation, governance,
Developer Megatrends H1 2015 2015 VisionMobile 17
Developers are a driving force in every industry
and a source of competitive advantage
Every company should master developer ecosystem skills
Developer Megatrends H1 2015 2015 VisionMobile
DEVELOPERS ESCAPE FROM THE APP STORE18
Developer Megatrends H1 2015 2015 VisionMobile
70% REVENUE GROWTH FOR APPS IN ONE YEAR. GREAT NEWS! OR IS IT?
19
Source: http://blog.appannie.com/mobile-app-advertising-and-monetization-trends-2013-2018/
Worldwide online advertising and app revenue
Developer Megatrends H1 2015 2015 VisionMobile
THE APP STORE ALONE CANNOT SUSTAIN THE DEVELOPER POPULATIONOnly 1 in 9 developers that rely on app store revenues are in the safe zone
20
% of mobile developers who use paid downloads, in-app purchases or advertising (and no other revenue model), by monthly revenue (n=1,187)
Source: Developer Economics Q1 2015
0%# 10%# 20%# 30%# 40%# 50%# 60%# 70%# 80%# 90%# 100%#
$0#
Developer Megatrends H1 2015 2015 VisionMobile
FOLLOW THE MONEY: E-COMMERCE IS THE WINNING APP REVENUE MODEL
21
Selling offline goods and services via apps:
71% of the app economy
9% of developers
earned by
Source: Developer Economics Q1 2015
Developer Megatrends H1 2015 2015 VisionMobile
E-COMMERCE MODEL #1: APPS AS A CHANNELTransact through the app
22
Nearly 60 percent ofAmazon.comcustomers shopped using a mobile device during the 2014 holiday period
Developer Megatrends H1 2015 2015 VisionMobile
E-COMMERCE MODEL #2: MOBILE-FIRST BUSINESSESOffline services that couldnt exist without the app
23
Uber will reach an estimated $10 billion annual run rate by end of 2015 http://www.businessinsider.com/uber-revenue-projection-in-2015-2014-11
Developer Megatrends H1 2015 2015 VisionMobile
E-COMMERCE MODEL #3: APPS AS A PLATFORMEnable others to build e-commerce businesses on top of your app
24 Source: Tencent investor presentation
WeChat app
3rd party businesses
operating on WeChat
Developer Megatrends H1 2015 2015 VisionMobile
http://vmob.me/AF14
200
300
400
500
91 120
152 186
2014 2015 2016 2017
total#mobile#e9commerce#revenue#($B)# all#other#revenue#models#($B)#
MOBILE E-COMMERCE WILL ONLY GET BIGGER IN THE COMING YEARS
25 Source: App Economy Forecasts 2014-2017 | VisionMobile
Developer Megatrends H1 2015 2015 VisionMobile 26
App stores alone cannot sustain the developer population
e-commerce is and will stay
the winning app revenue model
Developer Megatrends H1 2015 2015 VisionMobile 27
DEVELOPERS ESCAPE FROM CONSUMER MARKETS
Developer Megatrends H1 2015 2015 VisionMobile
ANOTHER WAY TO DODGE THE POVERTY TRAP: TARGET ENTERPRISES
28
64% of developers target consumers
20% of developers target enterprises
Source: Developer Economics Q1 2015
19% makes more than $10K per month
43% makes more than $10K per month
Developer Megatrends H1 2015 2015 VisionMobile
MAKING THE JUMP TO ENTERPRISE MIGHT BE EASIER THAN IT SEEMS!
29
Top 5 consumer categories Top 5 enterprise categories
There is substantial overlap in what consumer and enterprise app developers are working on.
Source: Developer Economics Q1 2015
29%#
29%#
26%#
25%#
24%#
Utilities
Games
Entertainment
Education & Reference
Business & Productivity Tools
64%#
52%#
20%#
17%#
16%#
Enterprise
Business & Productivity Tools
Utilities
Communication & Social Networking
Education & Reference
Developer Megatrends H1 2015 2015 VisionMobile
MAKING THE JUMP TO ENTERPRISE MIGHT BE EASIER THAN IT SEEMS!
30
Many apps can be simply repositioned or repurposed to attract an enterprise audience rather than consumers
Source: Developer Economics Q1 2015
Developer Megatrends H1 2015 2015 VisionMobile
THE INTERNET OF THINGS HAS A SIMILAR DISTRIBUTION OF DEVS AND REVENUE
31
Professionals, employees, other
% of developers with IoT as their main occupation by target audience
enterprises consumers
Source: Developer Economics Q1 2015 | Deloitte
60% of IoT device sales
90% of IoT service revenues
will come from enterprises in 2015
Developer Megatrends H1 2015 2015 VisionMobile
WINNER IOT DEVS APPLY CONSUMER TECHNOLOGY TO ENTERPRISE PROBLEMS
32
Wearables in industrial environments enable and optimize workflow efficiency,
enhance communications, reduce paperwork, and allow workers to take advantage of a hands-
free work environment
Source: Tractica
Drones "The Phantom was simple enough for
beginners, but powerful enough to interest serious hobbyists, professional
photographers, and filmmakers.
Smartphones & wearables in medical Apple ResearchKit: consumer smartphones and wearables provide objective, continuous sensor data and high signup rates in clinical research
Philips Hue "The Hue range began as a pure consumer
project [] but the Hue line has seen traction among small and medium businesses that are looking to create ambience in their premises."
Waze Connected Citizen program Data exchange program based on consumer-
generated data replaces expensive road sensor network with limited geographical reach.
20+ cities and regions already participating
Developer Megatrends H1 2015 2015 VisionMobile 33
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)
Developer Megatrends H1 2015 2015 VisionMobile 34
APPS ESCAPE FROM SCREENS
Developer Megatrends H1 2015 2015 VisionMobile
APPS ARE MOVING OUT OF MOBILE DEVICESThe app paradigm of bite-sized software is replicated outside of smartphones
35
Desktop Watch
Browser
Car
Home TV
Developer Megatrends H1 2015 2015 VisionMobile
THE NATURE OF APPS IS CHANGING, TOO
36
Developer Megatrends H1 2015 2015 VisionMobile
YESTERDAY: THE TRADITIONAL APP
37
the value is delivered by the app itself (even when connected to a backend service)
Developer Megatrends H1 2015 2015 VisionMobile
TODAY: THE COMPANION APP
38
the value is delivered by the device the app is just the remote control
Developer Megatrends H1 2015 2015 VisionMobile
TOMORROW: THE DATA APP
39
the value comes from combining all kinds of data the app processes triggers and signals across devices, sensors and APIs
Developer Megatrends H1 2015 2015 VisionMobile
THE FOCUS OF INNOVATION SHIFTS TO MAKING SENSE OF DATA
40
devices sensors
APIs Data Data app
delivering knowledge, enabling action
Connected device Companion app
Traditional app Yesterday
Today
Tomorrow
Where the value is concentrated
Developer Megatrends H1 2015 2015 VisionMobile
THE RISE OF THE DATA DEVELOPERNot all IoT developers do hardware; many more work on software and data
41
App makers
e.g. smartwatch apps, car apps,
Smart Home scenarios
Device makers
e.g. fitness bands, smart flower pots
Data-centric
e.g. smart home hub, health apps, Smart City,
system integrators, community projects
% o
f IoT
dev
elop
ers
Developer Megatrends H1 2015 2015 VisionMobile
FROM DEVICE TO DATA PLATFORMS
42
Current platform kings
device-centric
Future platform kings
data-centric
data routing
data structuring
data tracking & presentation
big data analytics stream processing
Developer Megatrends H1 2015 2015 VisionMobile 43
Value in tomorrows apps will come from
making sense of data
Data developers and data platforms will be king
Developer Megatrends H1 2015 2015 VisionMobile 44
PLATFORM PLAYERS ESCAPE FROM MOBILE
Developer Megatrends H1 2015 2015 VisionMobile
http://vmob.me/DE1Q15
WHAT IS THE FUTURE OF MOBILE PLATFORMS, GIVEN
45
(a) the current stalemate in the platform wars
(b) the evolution to data-centric apps, moving the focus away from operating systems and into the cloud
Developer Megatrends H1 2015 2015 VisionMobile
THE FUTURE OF MOBILE ECOSYSTEMS IS IN THE INTERNET OF THINGSAndroid & iOS fully leverage their developer and user bases to gain traction fast
46
Smart Home
Wearables Health & Wellness
Connected Car
WatchKit HealthKit
Google Fit
HomeKit
All these platforms are in the top 3 by developer popularity in their vertical.
Developer Megatrends H1 2015 2015 VisionMobile
MOBILE RUNNERS-UP TRY TO COPY THE RECIPEWith varying results in time-to-market and developer mindshare
47
Smart Home
Wearables Health & Wellness
Connected Car
Windows in the Car?
N/A
Developer Megatrends H1 2015 2015 VisionMobile
E-COMMERCE PLAYERS ARE IN TOO WITH PRODUCTS, APIS AND CLOUD Distribution capability and engaged users attract developers
48
Mobile Internet of Things
Kindle Fire and Fire Phone Echo Fire TV
#1 e-retailer in China
Mi-series of phones and tablets wide range of home products and wearables
Developer Megatrends H1 2015 2015 VisionMobile 49
THE $B QUESTION: WILL NETWORK EFFECTS FROM MOBILE CARRY OVER TO IOT?Will the mobile platform duopoly be sustained?
Developer Megatrends H1 2015 2015 VisionMobile
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.
50
Developer Megatrends H1 2015 2015 VisionMobile
CONVERGENCE: EXPERIENCE ROAMING ACROSS DEVICES
51
Social circle Developer ecosystem User data roaming Service roaming User interaction design Industrial design Brand
experience roaming across devices
convergence = x
Developer Megatrends H1 2015 2015 VisionMobile
APPLE AS THE POSTER CHILD OF EXPERIENCE ROAMING
52
Social circle Developer ecosystem User data roaming Service roaming User interaction design Industrial design Brand
experience roaming across devices
Facetime
App store
iCloud
iTunes, Airplay
iOS
Apple
Apple
iPhone
iPad
Mac
Apple TV
Watch
CarPlay
iPod
Developer Megatrends H1 2015 2015 VisionMobile
MULTI-DEVICE, INTEGRATED EXPERIENCES
53
2012
HomeKit Health / Watch CarPlay
Nest Fit / Wear Android Auto
Echo / Alexa
N/A
Kindle Fire Fire TV
Mi Band + Mi / MIUI Mi note Mi TV / Mi Box
2015
Mac computers iPhone iPad Apple TV
Chrome browser Android Android tablets Google TV
Windows Windows Windows Phone Xbox
PC smartphone tablet smart TV smart home
Cortana Health / Band Windows in the Car
?
Amazon.com Fire Phone
N/A
N/A N/A Mi Smart Home +
health / wearables connected car
Developer Megatrends H1 2015 2015 VisionMobile 54
Mobile ecosystem winners are fully leveraging their developer
and user bases to win in the Internet of Things
In the future, IoT device selection by consumers and
enterprises will be determined by
will it work with my existing services and devices
Developer Megatrends H1 2015 2015 VisionMobile 55
Developer Megatrends H1 2015 2015 VisionMobile Copyright VisionMobile 2011
Knowledge. Passion. Innovation.
Updated: 12 November 2010
Get in touch with Us
Matos Kapetanakis matos@visionmobile.com Senior Manager,
Get the latest Developer Economics reports: www.DeveloperEconomics.com/reports