To learn more about how the enterprise app store market will shape up, BriefingsDirect assembled a panel to delve into the market and opportunity for enterprise app stores, and to find out how they could be created quickly and efficiently. [Disclosure: Partnerpedia is a sponsor of BriefingsDirect podcasts.]
The experts included Michele Pelino, a Principal Analyst at Forrester Research; Mark Sochan, the CEO of Partnerpedia, and Sam Liu, Vice President of Marketing at Partnerpedia. The panel was moderated by Dana Gardner, Principal Analyst at Interarbor Solutions.
Here are some excerpts:
Gardner: Maybe you could paint a picture of what's going on with business applications, now that we have seen the app store model really pick up and become attractive to consumers.
Pelino: Our surveys say that about 30 percent of enterprises -- that's medium, large, as well as small enterprises -- are using app stores do deploy some of their applications at some level. It's not that they're doing everything that way today. That's the early stage of this, because this is an evolutionary path. It started on the consumer side and now it's going into the enterprise.
... It's really important to take a step back and recognize how important mobility has become to enterprises overall, as they are interacting with their employees and their customers and their partners and providers as well. ... We do surveys at Forrester of enterprises in both North America and Europe to better understand those priorities and how mobility fits into overall technology initiatives. We find that three of the top priorities that are being focused on by many enterprises are related to mobility.
Mobility includes many types of workers and applications that address not just the traditional email/calendaring applications, which are widely deployed by most companies, but is also pushing those applications down into line of business worker types of applications, which are tied to particular types of employees in an organization.
They're applications that may be designed for the sales team, customer service, support, or marketing. They also might be applications that are tied to the needs of particular vertical industry's logistics or supply chain management or enterprise asset management types of applications.
The other thing that's driving some of this momentum is that individuals, not just employees, are going out and buying lots of different smartphone devices and mobile devices. ... tablets, slates, and different types of smartphones. So, this momentum isn't just happening within the corporation. It's actually happening outside of that, and it's what we would call the consumerization of IT.
This means that many individuals, consumers, are driving requirements into the corporation and into the IT organization to get new types of applications on their devices, whether those devices are personally owned or ones that the corporation has as well.
App store momentum
One of the things to think about, when you are doing an app store, is to recognize that there's a lot of momentum around app stores in general. All the different device manufacturers have application stores tied initially to a consumer-oriented perspective.
The momentum around those app stores has driven corporations to start thinking about what they can do to more effectively and efficiently support their requirements around applications.
The thing with corporations is that IT organizations still want to control which version of the applications are in there and what types of apps an employee might have access to in a corporate environment, as opposed to what they might be doing in their personal world. Security is always a key issue here.
All of these things are really driving the need for these application stores -- but at an enterprise level. More and more applications are not just coming from what the IT organization wants to put out there, but also line-of-business workers.
By implementing these application stores, I, as an individual employee with a particular role will have access to certain applications. Another employee may have access to other applications that are tied to their role in the organization. And you could broaden that concept out to interacting with partners, suppliers, and customers as well.
... More enterprises are dealing with that pain-point of the complexity of getting these applications out there, of having to have some control over which version, monitoring them, tracking what's going on with the apps, ensuring that everybody is getting the application that they should ... or not.
... What we're seeing now is that some of these key drivers are coming together for large, medium, small enterprises who must figure out how to expand their applications and capabilities.
Gardner: Is this a big opportunity for IT to do something differently and better than the way they have distributed software in the past?
Sochan: There is no doubt that the IT group is getting pushed by the end users who have become very comfortable with how they can search, browse, try, download, and purchase applications. As a result, that has raised the expectations of how those same workers would like to be able browse, search, and download applications that could help them in their business world and with their productivity.
But, there are some pretty big differences between the consumer world of buying a 99-cent Angry Birds game versus downloading business applications. So some of the things that IT groups are having to think about and sort out are security and data governance, and how data that is specific to the device can be managed and, if need be, removed.
There are also issues about how the IT group can enable worker productivity and increase the satisfaction of the user base.
Savings and efficiencies
Finally, there's a need to try and find cost savings and efficiencies. If you had everyone just buying individual applications, then you wouldn't have the benefit of bulk license purchasing or the ability to purchase through normal corporate buying processes that result in larger scales of economy.
Gardner: How does an enterprise, a vendor, or a communication service provider start the process of thinking about architecting and providing such an app store?
Liu: We've talked to a number of different enterprises and various industries, and most of them are in the early stages of researching and trying to figure out what this means to them. They know that tablets are coming, but actually today's problems have as much to do with just devices already in-house, such as smartphones.
What we're hearing in terms of platforms is that the top three platforms they're trying to figure out are iOS, Android, and the platform coming from RIM.
In that research phase, some of the issues that they're concerned about are more traditional IT policies and compliance issues. They understand the motivation from the user standpoint and the value of that, but they're really trying to understand the landscape in terms of those more traditional issues around IT control and compliance, such as security.
The other thing is that they're also more open to outsourced or cloud and software-as-a-service (SaaS)-based solutions, as opposed to something that may be completely managed in-house via traditional software. The issue there is that they want to make sure that it actually can connect to the very secure session in the corporate environment, and that by outsourcing they are not giving that up in terms of the security and control.
So you might want to start with the current devices, such as phones and focus on maybe internal applications or select third-party applications. Deploy a project from that and then figure out how you want to evolve that towards other devices and other platforms. [Request an app marketplace demo.].
Sochan: At Partnerpedia we've been working with a number of the leading tablet vendors and some of the largest enterprise customers to understand what are the business problems and what are the priorities that need to be solved.
Overwhelmingly, what we're hearing is that most customers are not satisfied with just having an open marketplace that you might see from, say, the Google Apps Marketplace. They're looking for some blended model between complete end-user autonomy and some better corporate control. That's the first piece of feedback we are hearing.
The second piece is that there is a need to have some sort of branding. Most enterprise companies want to have some branding, so that it's very clear to their users that this is their marketplace, this is their store. And that store has a combination of third-party built applications, similar to what you might see if you went into an Apple App Store or into the Google Android marketplace.
Depending on the type of application and the user, there's a need to have a lot of control and flexibility for the corporation to either pre-purchase those licenses and to manage those licenses effectively. Then, they can both purchase and manage the distribution of those license, and be able to reclaim them as employees leave the organization or devices are lost, as well as allowing, as appropriate flexibility for the end-users to actually make purchases directly based on their budget. [Request an app marketplace demo.]
... If you look at the core essence of an app store, there is a repository or catalog of information that makes it very easy for a company's customers be able to find, browse, and look for products and services, not only from the vendor, but also related products and services that are of value from that vendor's ecosystem.
It almost doesn't matter what kind of company it is. Most companies have some extended ecosystem of value-added partners. The ability to create a very rich catalog of information that your customers can browse and search and look for related products and services makes it much more compelling and gains a lot more commitment from your partners.
Because you're now providing them with of a go-to-market benefit directly to the customers, and from the customer's perspective, they see tremendous value in your company's products and services, because they see the richness of the ecosystem around it.
At the heart of it is this catalog that can be highly personalized. You can imagine that if you're now able to personalize this for your customers, where your customers are coming into this marketplace and they are not just seeing a generic marketplace, they are actually seeing a marketplace that's been personalized to them.
This means that the marketplace already knows which products your customers have purchased from you and therefore is making a pre-selection or presenting them with information that's very specific and related to the footprint that, that customer already has of your products.
In some cases, in a more consumer-oriented world, you may want to actually go to a transaction and actually enable purchasing. But our enterprise customers are telling us that, equally important, if not more important, in the first steps is to have a very sophisticated lead capture engine, so that you can capture that interest that your customer has expressed, and been browsing and expressed interest in a particular product.
Then, you can route that, as appropriate, into whatever customer relationship management (CRM) system is being used and more effectively follow up with that customer, either with your own direct sales force or with passing that lead to your partners for the appropriate follow up.
... The core of the Partnerpedia offering is a white label, cloud-based, branded app store, that allows very efficient discovery and delivery of applications. The internal benefits for the internal facing app store is the capability for IT members to be able to pre-purchase select applications that they want their users have available to them. And also providing the capability to brand that app store so that it follows the company's logo and it has a very consistent corporate look and feel.
Then, giving a way for users to be able to very easily search, browse, and look for applications that are specific to their role in the organization.
Finally, the license management of that software, allowing the IT department to be able to track licenses that have been purchased and downloaded, as well as be able to reclaim those licenses as is appropriate, when an employee either no longer needs that license or has left the organization or has lost the device.
And looking more to the future, we are also working very closely with customers that are building a private branded marketplace. And I distinguish between an app store and a marketplace in that a marketplace is much broader than just applications. It can be hard goods, products, services, or offerings from partners and provides just a much richer way for customers to discover value-added offerings from a company. [Request an app marketplace demo.]
Gardner: Who are the folks who seem to be most interested in this? Is this something you're selling at multiple levels, or do you really have the ears yet of that business strategy?
Sochan: We're seeing it in a few different industries. Certainly high-tech is an area where this lends itself very well, because most companies are moving to a cloud services world and so they're looking for new and more innovative ways to combine and recombine multiple solution offerings to come up with more valuable offerings to their customers.
This is also driving opportunities for innovation and business models. how the customer pays for it. Having these bite-size pieces of innovation lends itself to new ideas and new business models in which there can be not only just actual new sources of revenue that can come out of this, because now it's a channel to the market.
Gardner: Do have any thoughts about the IT efficiency aspects of an app store model, if we take it beyond smartphones and tablets to the entire spectrum of endpoints the users use?
Pelino: We've been starting on the mobile device side of the world -- smartphones and tablets, those types of devices. But, at a corporate level, there are other types of endpoints that you need to manage and deploy applications to, and you want the same kind of control. You also want to have a sense of how much you are spending.
As a service type of delivery model or a per user type of delivery model, you can use different kinds of models here to keep control of the cost and have efficiencies around cost that you might not have today, because there is lots of overlap happening.
There are benefits as well, when you're thinking about individual end users who might have devices that they use in certain situations. When they're at their desk, maybe they have their laptops or desktops there. So, ultimately, you could have the same environment to integrate what an individual end-user or an employee could get in terms of the apps that they're able to get and always have a consistent experience for that.
The other side of that is just having a recognition that at the IT level, as much as they would love to control this, there are lots of devices around the bend. So even in the mobile world the devices we see today are not the ones that are going to be here tomorrow and there is more and more, almost on a day-to-day basis, being announced and put out there for end-users, whether it be enterprises or consumers to use.
How do I keep that in line? This app-store model is certainly one way to do it. But, when you think about it at the IT organization level, it's not just about mobility. They have to think about the endpoints across the organization and this could certainly be relevant in that case as well.
... You can imagine that now, with the capabilities that you have, you're going to be able to track and understand better what individuals are doing. Are they using certain applications? What they are doing? When they are doing it? As well as better understanding how you might be able to package and put together capabilities that might be more valuable to your customers in a manner that will be useful, in an individualized manner, not just basic bundles or combinations of services.
... For reference, there's a Forrester report that sets up the complexity that's facing many organizations that I touched on very early on, called "Managing Mobile Complexity."
There's another report that's coming out very soon around mobility in the cloud. We've been talking about these delivery mechanisms, cloud-based delivery mechanisms for applications and services, especially around mobile devices and applications and services. ...
A big BI benefit
From the business intelligence (BI) side of this, we've only started scraping the surface, because we are in the earlier stages. But as you have all of your customers, partners, and suppliers accessing these application stores, as well as your employees, you can then target those individuals with appropriate information. Not necessarily marketing all the time, but appropriate information, if it's for employees and partners and suppliers, and for the customers, certainly marketing and promotional activities could be tied in here as well.
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