"Preliminary Findings from the ICT Developers Survey" by David Card, Vice President, Gigaom Research

Preliminary findings: ICT Developers SurveyDavid Card, VP Gigaom Research

13 November 2013

• What we’re trying to accomplish– Modeling the Eurapp economy aftermarket– Understanding successes and challenges– Two surveys as inputs

• Preliminary findings from ICT developers survey• Rebooting the EU economy with apps?• App development challenges• Next steps

Agenda

European app ecosystem

OS suppliersAPI

suppliersDevices

Social

Mobile

Smart TV

ISVs

New PlatformsEnvironment

App Developer TypesOriginator

IT Developers

Cottage Industry, Hobbyists

Aftermarket

App Stores, 3rd party app-discovery

Revenue/Monetization• Consumer spending• Business spending• Advertising• In-app spending (virtual

goods)

Jobs created

New Platforms

Source: Smith's Point Analytics/Gigaom Research, 2013

Smartphone crossover coming fast

2012 2013 2014 2015 2016 20170

50

100

150

200

250

Smartphone Shipments, 2012-2017

North America Western Europe Japan

(million

s)

Source: Internet World Stats, 2012

Facebook adoption passing 50% in Europe

Mar-11 Jun-11 Seo 2011 Dec-11 Mar-120

50

100

150

200

250

Facebook Subscriber Growth

Europe Asia North America

(million

s)

• Over 500 responses• Mix across home countries: UK, Germany, France, Italy,

Spain• Mix of company sizes: 31% > 500 employees, 20% > 1,000• Mix of industries, though approximately 20% in technology;

13-14% of biggest companies in financial services

ICT developer survey background

Main business is commercial apps

For partners, distributors

For own employees

For customers

0% 20% 40% 60% 80% 100%

18%

38%

56%

67%

We develop or support custom mobile and social apps…

Apps for customers more than employees, supply chain

Source: preliminary Gigaom Research EU ICT developers survey, 3Q 2013 N= 525

Integrate with commercial apps from business apps stores

Integrate with commercial apps from consumer apps stores

Outsource to third parties

Develop in-house

0% 20%

40%

60%

80%

100%

19%

39%

53%

63%

Mobile and social apps approach

Half of in-house developers also outsource


None of above, just internal use

Charge for apps

Reduce customer service costs

To sell products, services

Marketing for products, services

To improve customer experience of our products, services

0% 20% 40% 60% 80% 100%

2%

24%

43%

46%

50%

58%

Commercial objectives for mobile and social apps

Apps to complement products, aid marketing/sales


Internal use by employees

Charge for apps

Reduce customer service costs

To sell products, services

Marketing for products, services

To improve customer experience of our products, services

0% 20% 40% 60% 80% 100%

38%

28%

38%

37%

39%

40%

34%

32%

29%

35%

38%

38%

Satisfaction with apps’ commercial ob-jectives

Very satisfied Somewhat satisfied

High satisfaction rates for key app objectives


Africa

Asia-Pacific

Japan

Nordic

USA, N. America

Spain

France

0% 10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

9%9%

12%12%13%

17%22%

25%26%

35%36%

40%41%41%

Other target markets

Seeking EU first; US, E. Europe, Nordic regions on radar


Smart TV

Social network

Other tablet

Other phone

iPad

iPhone

Android tablet

Android phone

0% 10% 20% 30% 40% 50% 60% 70% 80% 90%100%

14%

35%

26%

35%

61%

71%

63%

72%

Supported apps environments

One third target alternative phones, social nets


None

More than 30

16-30

7-15

4-6

2-3

One

0% 20% 40% 60% 80% 100%

2%

12%

12%

24%

21%

24%

5%

Number of apps developed, planned

Next yearLast year

Plenty of new apps, but growth rate flat


None

More than 500

101-500

51-100

31-50

11-30

6-10

3-5

1-2

0% 10% 20% 30% 40% 50% 60% 70% 80% 90%100%

19%

2%

2%

4%

8%

12%

15%

15%

23%

Number of app developers added last year

Nearly 30% of companies hired 10+ developers last year


No growth

More than 15%

11-15%

8-10%

6-7%

3-5%

1-2%

0% 20% 40% 60% 80%100%

Expected growth in number of app developers next year

Testing, supportScripters, designersEngineers, coders

Good growth: one fourth expect to grow over 5%


More than 500

101-500

51-100

31-50

11-30

6-10

3-5

1-2

0% 10% 20% 30% 40% 50% 60% 70% 80% 90%100%

Number of app developers, support staff

App developers Support staff

Nearly half 1:1 ratio of support staff to developers


No growth

More than 15%

11-15%

8-10%

6-7%

3-5%

1-2%

0% 10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

32%

4%

3%

7%

17%

22%

15%

Expected growth in number of app support personnel next year

Hiring growth even better than for developers


Interviews: Challenges for the Eurapp economy

Environmental• Platform concentration: US

companies dominate• 3+ year lag in adoption• Fragmented markets• Conservative investors,

entrepreneurs

Technical• Cross-platform development• Dev tools, open source• Native language support tools• Lagging 4G• Data portability

Business and Financial

• Immature ad market• No standard ad measurement

“currency”• Unwillingness to pay for apps• Low-priced apps• Customer acquisition costs• Access to capital

Resources• Fewer developers• Lower salaries• Lack of business expertise at

tech startups

Multiple currencies

Small European country markets

Lagging European tech adoption

Restrictive regulation

Inconsistent regulation

Multiple languages

App platforms dominated by Apple, Google, Facebook, etc.

0% 20% 40% 60% 80% 100%

15%

19%

19%

24%

28%

30%

31%

Top 2 European market challenges for apps

Fragmented markets, regulation; but no dominant bottleneck


Data available via API

Immaturity of open-source tech, community

Difficulty in delivering mobile experience

Dev tools

Adding social functionality

Breadth, depth of API services

Lagging European 4G adoption

Lack of cross-platform compatibility

0% 20% 40% 60% 80% 100%

14%

16%

18%

18%

18%

19%

28%

38%

Top 2 tech challenges for apps

In-house developers frustrated by platform divergence


Fewer developers

Fewer SW companies to spin off developers

Lack of business expertise at startups

Relatively less app dev education

Harder to attract dev talent, low salaries

0% 20% 40% 60% 80% 100%

24%

28%

32%

33%

40%

Top 2 resource challenges for European apps

Talent bottlenecks: salaries, education, business skills


• Platform proliferation will take care of itself• ICT developers highly satisfied with app commercial

effectiveness, investing more in staff• Half of in-house developers also outsource• Even more hiring growth in app support than development• Target markets mostly still in EU• Key challenges: talent competition, cross-platform

development

Key takeaways

• Mapping survey input to forecast model– Revenue– Jobs– New job creation

• Detailed job profiling• Comparisons with independent developers’ survey, cottage

industry• Take the survey http://eurapp.eu/independent-app-

developer-survey

Next steps

Technology

"Preliminary Findings from the ICT Developers Survey" by David Card, Vice President, Gigaom Research