Forrester on App Internet 2011

© 2011 Forrester Research, Inc. Reproduction Prohibited1 © 2009 Forrester Research, Inc. Reproduction Prohibited

The Mobile “App Internet” Recasts The Software And Services LandscapeEllen Daley, Vice President, Practice Leader

Based on research from John McCarthy, Thomas Husson, Charlie Golvin

© 2011 Forrester Research, Inc. Reproduction Prohibited2


Agenda

What does the “App Internet” future hold?

Where are the opportunities for Indian firms?

How to grab the opportunity?


The perfect storm of ‘networked innovation’ replaces serial waves of change

Minis PCs

Cloud

Mobile

Social

Smart

Analytics

Internet

Enterprise apps


The “App Internet”

“The App Internet is an application architecture of native apps on a

range of smart mobile devices, cars, televisions, and appliances

linked to a broad array of cloud-based services to provide a

optimized, context-rich experience anytime, anywhere . . .”

Source: February 28, 2011, “Mobile App Internet Recasts The Software And Services Landscape” Forrester report

© 2011 Forrester Research, Inc. Reproduction Prohibited6Source: Proxima Mobile

(http://www.proximamobile.eu/article/isommeil)


This is not a technical discussion!App Internet will convert predominantly search behaviors to a subscription channel model.

Injected by

cloud services


Who is ready for this innovation?

Base: *Base: 2,245 US adults (18+) who own a mobile phone Source: North American Technographics Survey, Q2 2010 (US, Canada)

Base: 18284 European adults (18+) who own a mobile phone Source: European Benchmark Technographics Survey, Q2 2011

"Which of the following activities do you do on your primary cell phone or handheld wireless

device AT LEAST MONTHLY?"

SMS Check news,etc. Send/receive work email

Download applica-tions

Access operator por-tal

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%Metropolitan India US Europe

In the U.S. 33% of smartphone

users download apps.

Base: 1,729 Indian adults (18+) who own a mobile phone Source: Asia Pacific Technographics Survey, Q2 2010


“As-A-Service” changes the economics of the tech industry

Year 1 Year 2 Year 3 Year 4 Year 50.0

0.2

0.4

0.6

0.8

1.0

1.2

1.4

CIOs in-house budget

"As-a-service" econom-ics

At 35-40% off, CFO starts

calling the shots

At 35-40% off, CFO starts

calling the shots

Source: Forrester Research, 5/2011

India (after china) prioritizes cloud

the most (56% call it a top mgmt priority)

geographically


The App Internet Market is big (by 2015):- $37b market for apps- $13.2b market for app services

Source: Mobile App Internet Recasts Software and Services Market, Forrester Research 2011


Traditional suppliers are not innovating fast enough to meet rising expectations

Business & Consumer

Expectations rise

‘Traditional’ Tech Industry Supplier Innovation

New Supplier Entry


The problem is not one of opportunity, but distribution.Applications are the currency of the tech industry

Customer

Cloud Vendors

Telcos

ISVsServices Vendors

Devices Vendors

AppsApps

AppsApps

Apps


Attributes of successful young players in this market

Partner with those that can provide the cross-channel experience

A product development model, (for services as well as ISVs)

Integration of a cross-section of skills:

– Gaming

– UI/UXP

– Legacy enterprise apps

– Agile

– Domain expertise

– ‘smart’ experience


The overall implications

The chief mobility officer (CMoO) emerges as a new buyer.

Telcos use apps as their currency to reduce churn

Mobile apps drive the intersection of product development and IT services.

Developers potentially turn to crowdsourcing for modules.

The tech sector sees the elimination of the business/consumer.

Forget smart city and smart grid — smart consumer devices & apps will be

the bigger market.

Enterprise mobility will be propelled by consumer market.

© 2009 Forrester Research, Inc. Reproduction Prohibited

Thank you

Ellen Daley+91 9818632652

[email protected]

www.forrester.com


Appendix/ Back-up slides


India and other economies leapfrog in cloud.

“Which of the following initiatives are likely to be your IT organization’s top IT management priorities over the next 12 months?”

Forrsights Budgets and Priorities Tracker Survey, Q2 2011

“Create a comprehensive cloud/as-a-service adoption/migration plan”

UK (n=199)

US (n=1,015)

Japan (n=114)

Russia (n=155)

Germany (n=186)

All respondents (n=2,741)

France (n=177)

Brazil (n=146)

India (n=144)

China/Hong Kong (n=184)

32%

34%

36%

37%

38%

38%

39%

45%

56%

58%

High and Critical Priority

Base: IT executives and technology decision-makers who selected ‘High’ or ‘Critical Priority’


2010 2011 2012 2013 2014 2015$0

$10,000

$20,000

$30,000

$1,900

$4,500

$9,400

$14,800

$22,500

$29,400

$300 $1,100$2,300

$3,800$5,700

$8,100

App sales for smartphones App sales for tablets

Even at $2.00/app, it’s a huge market.And cloud services on the back end fuel it further

Worldwide sales of smartphone and tablet apps (US$ millions)



The specialized services opportunity is large from mobile app development services to SI work.


Technology

Forrester on App Internet 2011