Developer Megatrends Η1 2015 PDF

DEVELOPER MEGATRENDS H1 2015
© 2015 VisionMobile.com
May 2015
1 Developer Megatrends H1 2015 © 2015 VisionMobile
About VisionMobile ™
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Developer Economics is VisionMobile’s flagship research program, tracking the latest mobile, IoT, desktop and cloud developer trends via our surveys and app analytics.
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Copyright © VisionMobile 2015 - v.1 Developer Megatrends H1 2015 © 2015 VisionMobile

VISIONMOBILE: THE ANALYSTS OF THE DEVELOPER ECOSYSTEM
VisionMobile 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

ABOUT THE AUTHOR
Stijn Michael Christina

Schuermans Vakulenko Voskoglou
Senior Business Strategy Director of

Analyst Director Research and
Operations
Stijn focuses on understanding how Michael has over 18 years experience in Christina leads the analyst team and
technology becomes value-creating mobile and telecom starting from working oversees all VisionMobile data projects
innovation, how business models affect on first experimental 3G systems in from methodology to analysis and insights
market dynamics, and the consequences of Qualcomm. Later on Michael was part of generation. She is also behind
this for corporate strategy. He is the lead several startups developing products in the VisionMobile’s developer segmentation
Internet of Things researcher in the areas of wireless, enterprise networking research, as well as the Developer
VisionMobile team since 2012. Stijn holds and mobile apps. At VisionMobile Michael Economics reports and DataBoard
an engineering master degree and an MBA. works at the cross section of business subscription services. Christina has more
He has over 10 years experience as an models, economics and technology where than 16 years of experience in statistical
engineer, product manager, strategist and he leads strategy practice for software- consulting, BI design and business
business analyst. centric business models in mobile, Internet forecasting. She holds an MSc in Statistics
of Things and Connected Car. from the London School of Economics
You can reach Stijn at: (LSE) and a BSc in Economics & Statistics
stijn@visionmobile.com You can reach Michael at: from the University of Bath.
@stijnschuermans michael@visionmobile.com
@mvakulenko You can reach Christina at:
christina@visionmobile.com
@ChristinaVoskog

IN THIS REPORT
Introduction – Developers are kingmakers in every industry
Developers Developers Apps escape Platform players

escape from the escape consumer from screens escape from
app store markets mobile

DEVELOPERS ARE KINGMAKERS IN EVERY INDUSTRY
DEVELOPERS HAVE CONQUERED THE PHONE WITH APPS
8 Source: VisionMobile estimates Developer Megatrends H1 2015 © 2015 VisionMobile

THEY’RE JOINED BY 800,000 NEW MOBILE DEVELOPERS PER YEAR
http://vmob.me/AF14
9 Source: App Economy Forecasts 2014-2017 | VisionMobile Developer Megatrends H1 2015 © 2015 VisionMobile
DEVELOPERS MOVE TO MORE AND MORE INDUSTRIES AND VERTICALS
53%
of mobile developers are already
involved in the Internet of Things
… and many more to come
http://vmob.me/IoT15

DEVELOPERS ARE CONQUERING… THE WRIST
Apple Watch Android Wear Pebble
3,500+ apps 2,300+ apps 1,400+ apps
11 Source: Apple, Pebble, Android Wear Center, VisionMobile estimates (Q1 2015) Developer Megatrends H1 2015 © 2015 VisionMobile
DEVELOPERS ARE CONQUERING… THE CAR
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
Aftermarket solutions for any car,

250+ OBD apps in Google Play,
growing support from big players

DEVELOPERS ARE CONQUERING… THE HOME
a small selection of Smart Home platforms and APIs
There are a lot of things that we’re 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.
Tony Fadell The opportunity in the home is going to be pretty close.
ex-Apple, CEO Nest
https://www.youtube.com/watch?v=377oDvnrk5M&t=20m40s (edited for clarity)
DEVELOPERS ARE CONQUERING… THE SKY
Raised $75M to build an industrial UAV “Android for drones” An operating system for
developer platform (May 2015) commercial drones
http://dev.dji.com/ http://dronekit.io/ http://www.airware.com/developers
There are a lot of industrial use cases that DJI can’t 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
Michael Perry agriculture, construction, and mining.
DJI
http://techcrunch.com/2015/05/06/dji-drone-platform/

Developers are conquering … cities
… healthcare
… clothing
… factories
… well, everything really!

TODAY’S COMPETITIVE BATTLES ARE WON AND LOST BY ATTRACTING DEVELOPERS
Apple iOS | Google Android Microsoft Windows

took #1 spot from Nokia and dominant OS in the 90s and 00s
Blackberry in (smart)phones because of superior developer strategy
Salesforce
1.4M registered devs in 2013
Under Armour took #1 spot from Oracle in CRM
fashion brand uses
developers to engage
communities of athletes

EVERY COMPANY SHOULD MASTER DEVELOPER ECOSYSTEM SKILLS
developer ecosystem =
platform rules for

technology + people + interaction
API
cloud, APIs, apps, individuals & companies app curation,

devices, OS, … users & developers governance, …

Developers are a driving force in every industry
and a source of competitive advantage
Every company should master developer ecosystem skills

DEVELOPERS ESCAPE FROM THE APP STORE
70% REVENUE GROWTH FOR APPS IN ONE YEAR. GREAT NEWS! OR IS IT?
Worldwide online advertising and app revenue
Source: http://blog.appannie.com/mobile-app-advertising-and-monetization-trends-2013-2018/

THE APP STORE ALONE CANNOT SUSTAIN THE DEVELOPER POPULATION
Only 1 in 9 developers that rely on app store revenues are in the safe zone
App poverty line Sustainability line
($500 per month) ($10K per month)
Zero App poverty Twilight Safe

zone zone zone zone
0%# 10%# 20%# 30%# 40%# 50%# 60%# 70%# 80%# 90%# 100%#
$0# <$500# <$10K# >$10K#
% of mobile developers who use paid downloads, in-app purchases or

advertising (and no other revenue model), by monthly revenue (n=1,187)
21 Source: Developer Economics Q1 2015 Developer Megatrends H1 2015 © 2015 VisionMobile

FOLLOW THE MONEY: E-COMMERCE IS THE WINNING APP REVENUE MODEL
Selling offline goods and services via apps:
71% earned
by 9%
of the app economy of developers

E-COMMERCE MODEL #1: APPS AS A CHANNEL
Transact through the app
Nearly 60 percent of Amazon.com customers shopped

using a mobile device during the 2014 holiday period

E-COMMERCE MODEL #2: MOBILE-FIRST BUSINESSES
Offline services that couldn’t exist without the app
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

E-COMMERCE MODEL #3: APPS AS A PLATFORM
Enable others to build e-commerce businesses on top of your app
3rd party
businesses
operating on
WeChat
WeChat app
25 Source: Tencent investor presentation Developer Megatrends H1 2015 © 2015 VisionMobile

MOBILE E-COMMERCE WILL ONLY GET BIGGER IN THE COMING YEARS
http://vmob.me/AF14
500
400
300
200
186
152
120
91
2014 2015 2016 2017

total#mobile#e9commerce#revenue#($B)# all#other#revenue#models#($B)#
26 Source: App Economy Forecasts 2014-2017 | VisionMobile Developer Megatrends H1 2015 © 2015 VisionMobile
App stores alone cannot sustain the developer population
e-commerce is and will stay
the winning app revenue model

DEVELOPERS ESCAPE FROM CONSUMER MARKETS
ANOTHER WAY TO DODGE THE POVERTY TRAP: TARGET ENTERPRISES
19% makes more than $10K per month

64% of developers
target consumers
43% makes more than $10K per month

20% of developers
target enterprises

MAKING THE JUMP TO ENTERPRISE MIGHT BE EASIER THAN IT SEEMS!
Top 5 consumer categories Top 5 enterprise categories
Utilities 29%# Enterprise 64%#
Games 29%# Business & Productivity Tools 52%#
Entertainment 26%# Utilities 20%#
Communication & Social

Education & Reference 25%# 17%#
Networking
Business & Productivity Tools 24%# Education & Reference 16%#
There is substantial overlap in what consumer

and enterprise app developers are working on.

MAKING THE JUMP TO ENTERPRISE MIGHT BE EASIER THAN IT SEEMS!
Many apps can be simply repositioned or repurposed

to attract an enterprise audience rather than consumers

THE INTERNET OF THINGS HAS A SIMILAR DISTRIBUTION OF DEVS AND REVENUE
Professionals,
employees, other 60% of IoT
device sales
90% of IoT
enterprises consumers
service revenues
% of developers with IoT as their … will come from enterprises

main occupation by target audience in 2015
32 Source: Developer Economics Q1 2015 | Deloitte Developer Megatrends H1 2015 © 2015 VisionMobile
WINNER IOT DEVS APPLY CONSUMER TECHNOLOGY TO ENTERPRISE PROBLEMS
Drones Wearables in industrial environments

"The Phantom was simple enough for enable and optimize workflow efficiency,
beginners, but powerful enough to interest enhance communications, reduce paperwork,
serious hobbyists, professional and allow workers to take advantage of a hands-
photographers, and filmmakers.“ free work environment
Philips Hue Source: Tractica
"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

Smartphones & wearables in medical Data exchange program based on consumer-
Apple ResearchKit: consumer smartphones and generated data replaces expensive road sensor
wearables provide objective, continuous sensor network with limited geographical reach.
data and high signup rates in clinical research 20+ cities and regions already participating

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
APPS ARE MOVING OUT OF MOBILE DEVICES
The app paradigm of bite-sized software is replicated outside of smartphones
Watch Desktop Car
TV Browser Home

THE NATURE OF APPS IS CHANGING, TOO

YESTERDAY: THE TRADITIONAL APP
the value is delivered by the app itself

(even when connected to a backend service)

TODAY: THE COMPANION APP
the value is delivered by the device

the app is just the remote control

TOMORROW: THE DATA APP
the value comes from combining all kinds of data

the app processes triggers and signals across devices, sensors and APIs

THE FOCUS OF INNOVATION SHIFTS TO MAKING SENSE OF DATA
Yesterday Traditional app
Today Connected device Companion app
devices
Data app
Tomorrow sensors Data
APIs delivering knowledge, enabling action
Where the value is concentrated

THE RISE OF THE DATA DEVELOPER
Not all IoT developers do hardware; many more work on software and data
% of IoT developers
App makers Device makers Data-centric
e.g. smartwatch apps, e.g. fitness bands, e.g. smart home hub,
car apps, smart flower pots health apps, Smart City,
Smart Home scenarios system integrators,
community projects
FROM DEVICE TO DATA PLATFORMS
Current platform kings Future platform kings
device-centric data-centric
data routing
data
structuring
data tracking
& presentation
stream processing
big data analytics

Value in tomorrow’s apps will come from
making sense of data
Data developers and data platforms will be king

PLATFORM PLAYERS ESCAPE FROM MOBILE
WHAT IS THE FUTURE OF MOBILE PLATFORMS, GIVEN…
(a) the current stalemate

in the platform wars
http://vmob.me/DE1Q15
(b) the evolution to data-centric apps,

moving the focus away from
operating systems and into the cloud

THE FUTURE OF MOBILE ECOSYSTEMS IS IN THE INTERNET OF THINGS
Android & iOS fully leverage their developer and user bases to gain traction fast
Smart Wearables Health & Connected

Home Wellness Car
Google Fit
HomeKit WatchKit HealthKit
All these platforms are in the top 3 by developer popularity in their vertical.

MOBILE RUNNERS-UP TRY TO COPY THE RECIPE
With varying results in time-to-market and developer mindshare
Smart Wearables Health & Connected

Home Wellness Car
N/A
Windows in the Car?

E-COMMERCE PLAYERS ARE IN TOO WITH PRODUCTS, APIS AND CLOUD
Distribution capability and engaged users attract developers
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

THE $B QUESTION: WILL NETWORK EFFECTS FROM MOBILE CARRY OVER TO IOT?
Will the mobile platform duopoly be sustained?

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.

CONVERGENCE: EXPERIENCE ROAMING ACROSS DEVICES
experience roaming across devices
Social circle
Developer ecosystem
User data roaming
convergence = Service roaming x
User interaction design
Industrial design
Brand

APPLE AS THE POSTER CHILD OF EXPERIENCE ROAMING
experience roaming across devices
Facetime iPhone
Social circle
Developer ecosystem App store iPad
User data roaming iCloud Mac
Service roaming iTunes, Airplay Apple TV
User interaction design iOS Watch
Industrial design Apple CarPlay

Brand Apple iPod

MULTI-DEVICE, INTEGRATED EXPERIENCES
2012 2015
PC smartphone tablet smart TV smart home health / wearables connected car
Mac computers iPhone iPad Apple TV HomeKit Health / Watch CarPlay
Chrome browser Android Android tablets Google TV Nest Fit / Wear Android Auto
?
Windows Windows Phone Windows Xbox Cortana Health / Band Windows in the Car
N/A N/A
Amazon.com Fire Phone Kindle Fire Fire TV Echo / Alexa
N/A N/A
Mi / MIUI Mi note Mi TV / Mi Box Mi Smart Home + Mi Band + …
…

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”

Get in touch with Us Knowledge. Passion. Innovation.
Matos Kapetanakis
matos@visionmobile.com
Senior Manager,
Updated: 12 November
2010
Get the latest Developer Economics reports:
www.DeveloperEconomics.com/reports
Developer Megatrends H1 2015 ©Copyright

2015 VisionMobile
VisionMobile 2011

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DEVELOPER MEGATRENDS H1 2015

Our mantra: distilling market noise into market sense.

3. Representations, Warranties and Disclaimer

Copyright © VisionMobile 2015 - v.1 Developer Megatrends H1 2015 © 2015 VisionMobile

Primary research Thought-leading reports Developer data

Developer Megatrends H1 2015 © 2015 VisionMobile

Developer Megatrends H1 2015 © 2015 VisionMobile

Stijn Michael Christina

Senior Business Strategy Director of

Developer Megatrends H1 2015 © 2015 VisionMobile

Introduction – Developers are kingmakers in every industry

Developers Developers Apps escape Platform players

6 Developer Megatrends H1 2015 © 2015 VisionMobile

8 Source: VisionMobile estimates Developer Megatrends H1 2015 © 2015 VisionMobile

… and many more to come

10 Developer Megatrends H1 2015 © 2015 VisionMobile

Apple Watch Android Wear Pebble

3,500+ apps 2,300+ apps 1,400+ apps

API available by invite only

API publicly available (Nov 2014)

Aftermarket solutions for any car,

12 Developer Megatrends H1 2015 © 2015 VisionMobile

a small selection of Smart Home platforms and APIs

There are a lot of things that we’re not going to be able to

http://dev.dji.com/ http://dronekit.io/ http://www.airware.com/developers

14 Developer Megatrends H1 2015 © 2015 VisionMobile

… well, everything really!

15 Developer Megatrends H1 2015 © 2015 VisionMobile

Apple iOS | Google Android Microsoft Windows

16 Developer Megatrends H1 2015 © 2015 VisionMobile

platform rules for

cloud, APIs, apps, individuals & companies app curation,

17 Developer Megatrends H1 2015 © 2015 VisionMobile

and a source of competitive advantage

Every company should master developer ecosystem skills

18 Developer Megatrends H1 2015 © 2015 VisionMobile

Worldwide online advertising and app revenue

20 Developer Megatrends H1 2015 © 2015 VisionMobile

App poverty line Sustainability line

($500 per month) ($10K per month)

Zero App poverty Twilight Safe

$0# <$500# <$10K# >$10K#

% of mobile developers who use paid downloads, in-app purchases or

21 Source: Developer Economics Q1 2015 Developer Megatrends H1 2015 © 2015 VisionMobile

Selling offline goods and services via apps:

22 Source: Developer Economics Q1 2015 Developer Megatrends H1 2015 © 2015 VisionMobile

Nearly 60 percent of Amazon.com customers shopped

23 Developer Megatrends H1 2015 © 2015 VisionMobile

24 Developer Megatrends H1 2015 © 2015 VisionMobile

25 Source: Tencent investor presentation Developer Megatrends H1 2015 © 2015 VisionMobile

2014 2015 2016 2017

e-commerce is and will stay

the winning app revenue model

27 Developer Megatrends H1 2015 © 2015 VisionMobile

19% makes more than $10K per month

43% makes more than $10K per month

29 Source: Developer Economics Q1 2015 Developer Megatrends H1 2015 © 2015 VisionMobile

Top 5 consumer categories Top 5 enterprise categories

Utilities 29%# Enterprise 64%#

Games 29%# Business & Productivity Tools 52%#

Entertainment 26%# Utilities 20%#

Communication & Social

Business & Productivity Tools 24%# Education & Reference 16%#